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First residential tower now delayed until spring or summer; Forest City admits "goal" of including more larger units won't be met; CM James says developer's not meeting commitment

For the umpteenth time, Forest City Ratner has pushed back the projected groundbreaking for the first Atlantic Yards residential tower, Building 2 (B2), at the corner of Flatbush Avenue and Dean Street flanking the Barclays Center arena. Now the groundbreaking could be spring, as most recently projected, or summer.

Also, as acknowledged today at the Atlantic Yards District Service Cabinet meeting, Forest City will not meet its "goal"--purportedly guaranteed by the Community Benefits Agreement and long promoted by the developer--of ensuring that half of the subsidized "affordable housing" would be (in square footage) devoted to larger units of two and three bedrooms.

"It doesn’t dilute our desire to meet the commitment in the future," insisted Forest City executive Jane Marshall at the meeting, held at Borough Hall.

"I understand your desire," responded Council Member Letitia James, skeptically. "I desire to be thin, and young"--the audience chuckled--"but that’s not going to happen. The bottom line is that, there was a commitment, there was a promise. There’s a need in the neighborhood... I would hope you would honor your commitment to the community.”

Forest City Ratner's partner ACORN, or its successor, was supposed to hold the developer to its housing pledge, but Bertha Lewis, who promoted the project because of the pledge, has not yet questioned the commitment.

B2 delays

Forest City initially promised that the 16 towers, along with the arena, would be built out in a decade, as promised in the plan approved in 2006 by the Empire State Development Corporation (ESDC).

After the recession hit in 2008, Forest City asked the ESDC for help in achieving savings, and the agency, in the 2009 Modified General Project Plan, re-approved the project to allow for the use of eminent domain in stages, rather than at one time, thus saving the developer from paying for the land all at once.

The state agency allowed that the project might take longer than ten years, but insisted that the first tower was on schedule. That schedule has been slipping ever since.

June 2009, ESDC Technical Memorandum: "These potential delays due to prolonged adverse economic conditions would not affect the timing of the development of the arena, the transit access improvements, the construction of the new LIRR rail yard, the reconstruction of the Carlton Avenue Bridge or the construction of Building 2."

September 2009: arena architect Gregg Pasquarelli of SHoP said, "The current plan by the client is to get Building 2 started six to nine months after the arena begins." (The arena began in March 2010, so that meant a late 2010 groundbreaking.)

February 2010: Marshall said, "As we've stated publicly, we intend to begin design of the first residential building in such a way that it can break ground in the fourth quarter of this year."

September 2010: Forest City executive MaryAnne Gilmartin said, "We anticipate having funding in place to start the first building at Dean and Flatbush in the spring of 2011, the second six to nine months later, and the third about the same time after that."

November 2010: Gilmartin said the developer intends to release designs and start construction in the first quarter of 2011.

February 2011: Marshall said, ""We still believe we can get in the ground in 2011, and that’s our goal."

July 2011: Gilmartin said, “We expect to decide on our construction approach in the coming months, and we anticipate a groundbreaking by year end."

September 2011: Marshall said, "We hope to have something to report by the end of the year, and have the first residential building, in construction by the beginning of the year.”

November 2011: Marshall said, "“We still believe that, before the end of the year, we will be able to announce which way we’re going and show the design to the public. That's our goal, consistent with our goal to break ground on B2 early next year.

November 2011: Forest City Ratner releases plan for modular construction of B2, and tells the Wall Street Journal it expects B2 "to be started in the spring."

January 2012: Marshall says today, "We want to break ground in the spring or in the summer."

Today's explanation

This morning, Marshall told the group, which consists of representatives of elected officials and interested agencies, with some community members watching, "We are continuing on--pursuing our efforts in the design, finalizing the design for Building 2, and talking with the city about financing. We released a design and we released details of the building in the fall. And it’s a 50% market, 50% affordable building. And it has approximately 400 units total"--actually 350--"and we continue to pursue our efforts to build so we can break ground this year. We want to break ground in the spring or in the summer."

Marshall did not mention whether Forest City was still expecting to construct the building using modular technology--as announced--or whether it had put that plan aside.

Arana Hankin, Director, Atlantic Yards Project, for Empire State Development, said that Forest City had submitted a design for the agency's design review, to ensure that the building complies with the Design Guidelines for the project.

Why no larger units?

Later in the meeting, James noted that there's a "desperate need" in her Council district for two-bedroom and three-bedroom apartments. How many would there be in B2?

"I believe that we have a goal of a certain percentage of two bedroom units, which I think is 20%,  although somebody can correct me," Marshall responded quizzically. (Actually, there's no goal for a percentage of two-bedroom units; there's a commitment to devote 50% of square footage to two- and three bedroom units, as she could have read two days ago.)

"I don't believe that the current design reflects or meets that goal," Marshall said. "We recognize the need for larger units...We are currently trying to achieve that goal, although we have to proceed with design, with trying to get this building into the ground."

What does that mean? "Trying to get this building into the ground," I suspect, means "delivering at least some of the promised affordable housing." Also, if Forest City does not get B2 started before the arena opens, it could see development stalled as a penalty, if the Carlton Avenue Bridge does not reopen in time.

Not giving up

"So in no ways have we deserted that goal," Marshall said. "We are continuing discussions with the city and financing agencies. It has to do with the way they calculate floor area and the subsidies in this complicated discussion... Right now, Building 2 is short of the goal that we all want to achieve, which is a larger number of two-bedroom units."

"My understanding is that sometime ago," James followed up, "there was a commitment that half of the units would be larger units, not just 20 percent."

"If I'm wrong about the percentage, it's just because I'm not specifically, in detail, knowledgeable about it," Marshall replied, a sign of either faux-naivete or some kind of memory loss. "Whatever the percentage is, it’s a goal. It's not something we're deserting or giving up on."

"We recognize that B2 right now does not meet that goal," she continued. "We also want to go forward with B2, so there is a chance B2 will go forward not meeting that goal. That doesn’t mean we won't pursue meeting that goal for all of the other buildings. We are still in discussions with the city about this, so we haven’t given up."

Will goal be met?

James said that the other units might not arrive until the "far distant future."

Marshall said it was complicated, that "the financing vehicles from the city make it difficult to reach those goals."

"You probably in all likelihood will not reach those goals," James countered.

"I don't think that's fair," Marshall replied. "We may not, on the first building, but that doesn't dilute our desire to meet it, and it doesn’t dilute our desire to meet the commitment in the future."

And that provoked James to comment that "I desire to be thin, and young, but that’s not going to happen."


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