In the middle of the Documents page on Forest City Ratner's new AtlanticYards.com web site are links to two Memoranda of Understanding (MOUs), both dated 2/18/05. Both involve the developer, the Empire State Development Corporation, the New York City Economic Development Corporation, and the city. One concerns the general outline of the Atlantic Yards plan; it was heralded by Mayor Bloomberg and Governor Pataki in a 3/3/05 press release that described a "21-acre site."
The second MOU added another acre to the project, involving development at Site 5, the home of P.C. Richard/Modell's, across Flatbush Avenue from the original Atlantic Yards footprint. (It's the site farthest west in the plan at right.)
It was not announced by the developer or any government entity. The MOU didn't come to light until Develop Don't Destroy Brooklyn acquired it and publicized it in a 8/17/05 press release that asserted:
The second MOU, or "MOU 2," allows new development rights for FCR to develop millions more square feet over their Atlantic Center Mall and the PC Richards/Modell's mall (Site 5) at the intersection of Flatbush and Atlantic Avenues. These sites are directly adjacent to the disclosed footprint of Ratner's proposed Brooklyn Atlantic Yards (BAY) project outlined in the public MOU... This would add more than one million square feet to what is already 8 million square feet of development in the BAY plan, and what is already an overburdened traffic intersection and public transportation hub.
Correcting the press release
A closer look shows that DDDB was partly wrong in its interpretation of the MOU. The document did grant additional development rights, as well as the exercise of eminent domain at Site 5, but it did not add development rights at both the Atlantic Center mall and Site 5. Rather, it transferred development rights from the mall (right) to Site 5, thus allowing the developer to construct a building more than twice as big as previously possible. (Now planned: a 350-foot tower, which would be bordered at the south and west by low-rise buildings.)
Press coverage of the second MOU also got it wrong, and so did I, in a post that mentioned that the developer was given new rights to build towers at Atlantic Center and another about the differences between the Atlantic Center and Atlantic Terminal malls. (I've made corrections.) Rather, Forest City Ratner all along has had the right to tear down the much-derided mall and build a much larger development. But apparently FCR would rather build taller at Site 5 before going through the more arduous process of replacing the mall.
Looking at the document
The document discusses:
unused development rights...attributable to... (i) Atlantic Center (Block 2002, Lot 1) (including the rights attributable to the demapped portion of Fort Greene Place), which FCRC and the City Parties believe consist of approximately 1.586 million zoning square feet... and (ii) Site 5 (the entirety of Block 927, excluding the community garden parcel thereon, as currently configured) in the Atlantic Terminal Urban Renewal Area ("ATURA"), Brooklyn, New York ("Site 5"), which FCRC and the City Parties believe consist of approximately 308,000 zoning square feet (in addition to existing retail) under applicable zoning. (Site 5 at right.)
If the arena and mixed-use development project already planned goes forward, the document says that ESDC would incorporate the development at Site 5 into the general arena plan (or look at it separately), and:
exercise, in consultation with the City....its power to override local zoning and other regulations where appropriate to provide for up to an additional 328,272 zoning square feet in development rights to be added to Site 5, on the condition that FCRC concurrently agree to an equivalent reduction in the allowable density available under its City ground lease for Atlantic Center Site.
As a reader pointed out to me, the developer didn't need the MOU to codify what it already has; it sought an MOU to move those rights somewhere else.
The MOU indicates that FCR would develop up to 875,000 square feet of commercial space and up to 711,000 square feet of residential space on the Atlantic Center site, minus, if the Atlantic Yards project proceeds, 328,272 square feet. Just by comparison, the Atlantic Center mall now contains 393,713 square feet square feet, so 1.586 million square feet is approximately four times larger. (Rather than a building exactly four times the size, that the residential and office space would be in two tapered towers, most likely.)
The document also mentions "fees and expenses associated with the condemnation process." While Forest City Ratner developed Site 5, it does not control the whole site. The FCR web site lists Modell's as a tenant, but not P.C. Richard. The New York Sun reported that FCR spokesman Joe DePlasco said "that P.C. Richard, which also owns part of the site, has not yet agreed to sell its stake," but that negotiations were continuing.
A shopper at P.C. Richard, however, was recently told that the store would be vacating the site by September.
How many square feet, really?
The DDDB press release stated that the second MOU allows "FCR to develop millions more square feet." Actually, it would shift 328,272 square feet to the Atlantic Yards plan. Add to that 308,000 square feet already allowable at Site 5, and the MOU shifted more than 636,000 square feet, not millions. (DDDB has since added a correction.)
I asked Daniel Goldstein of Develop Don't Destroy Brooklyn to comment. His response:
"These agreements are deliberately complicated and sometimes are read inaccurately. We made a mistake in evaluating this secret agreement which was only made public after we received it through a Freedom of Information request. What is clear is that this 'Second MOU' allows yet another end run around city land use procedures and laws... In this case, beyond the air rights transfer, that allows further development outside of ULURP and more eminent domain abuse on the properties at Site V. So what we will see is a 350-foot tower at Site V and, in addition to the 'Atlantic Yards' proposal, 1.25 million new square feet of development over what is currently Atlantic Center Mall."
Note that it's not clear when Forest City Ratner intends to build at the Atlantic Center site. Likely that's dependent on the progress of the Atlantic Yards plan. But plans for the Atlantic Center should be considered as part of the potential development in the area.
Press coverage errors
The New York Sun, in an 8/18/05 article headlined Private Memo Guarantees Ratner Space, got the numbers wrong:
City and state officials, in a memorandum they never released, promised the developer Forest City Ratner six months ago that they would arrange for the firm to obtain the rights to build almost 1.9 million square feet of residential and commercial space in downtown Brooklyn (Photo of Pacific Street, at the southern border of Site 5, from OnNYTurf.com.)
The Brooklyn Papers, in an 8/20/05 article headlined Double Dealing, also got the numbers wrong:
The document stipulates that Ratner would be able to obtain the development rights to build nearly 1.9 million square feet of residential and commercial space on properties north and west of the Atlantic Avenue rail yards, exceeding the current zoning for those sites, without having to put the proposal through the city’s lengthy land use review process.
At least those newspapers covered the issue, and they shed light on two key issues: that an unpublicized document both granted additional development rights to Forest City Ratner and enabled the exercise of eminent domain. Had there been more coverage, reporters might have clarified the numbers and questioned city and FCR officials further.
So, why wasn't the MOU distributed? The Brooklyn Papers reported:
We do not distribute MOUs, but this one’s been available to anyone that requested it,” said Janel Patterson, a spokeswoman for the city EDC.
Asked how anyone could have possibly known of its existence, and why the one MOU was widely publicized while the other was never mentioned, she declined to comment.
“The proposed development at Site 5 should not come as a surprise to anyone,” said Forest City Ratner spokesman Joe DePlasco. “In fact, it was part of a May presentation to the City Council, included in many other discussions and presentations.
“While not technically part of the Atlantic Yards development, it was included in these presentations because development there would, of course, be in close proximity to the larger project.”
(Photo from FCRC.com)
Now, of course, it has become part of the Atlantic Yards project and there's little reason to think that FCR would've hired a separate architect to design it. By focussing on the presence of Site 5 in the Atlantic Yards plan, DePlasco ignored how the MOU granted new development rights at the site. (See Tactic #4: Changing the Subject.)
The issue came up at the 10/24/05 meeting of the Brooklyn Borough Board Atlantic Yards Committee. According to the notes:
Why was there a separate, secret MOU?
At the time, there were two investment groups. ESDC is now treating them as one project.
There's no explanation of why one of the MOUs would be publicized and one kept under wraps.
Development at Site 5 was discussed by FCR at the 5/26/05 City Council hearing. However, the essence of the memo was not revealed at the hearing: the developer would be able to build bigger at Site 5 than previously permitted, and could get the help of the state in clearing out P.C. Richard.