Skip to main content

Forest City re-interprets Atlantic Yards Phase 1: arena block plus Block 1129, to the southeast. The platform for the blighted railyard has 15 years (and who knows when the towers rise)

Update March 29: In my initial post yesterday, I neglected to point out what I reported last October  regarding previous comments about the construction sequence; the Development Agreement, released in January 2010, gives the developer 15 years to start the platform after the project Effective Date (May 2010). So this revision has a few changes.

It's official. Atlantic Yards developer Forest City Enterprises (FCE) in a document released yesterday has confirmed that its Forest City Ratner subsidiary has no plan to build an expensive deck over the 8.5-acre Vanderbilt Yard--the most clearly blighted part of the 22-acre Atlantic Yards site, and a major justification for eminent domain--before building four towers on the southeast block of the site, Block 1129.

That sets up, as the graphic at right suggests, a odd map in which the "project" leapfrogs one long block between Sixth and Carlton Avenues.

That leaves the below-grade railyard waiting for an expensive deck (which can wait 15 years) and furthering development on the main piece of terra firm beyond the arena block. It further undermines the once-promised plans to build the 16-tower project in ten years, rather than the 25 years permitted by state contracts.

And the document raises questions about whether and when that deck will be built. Even if they build it soon after constructing a new railyard, they're not planning to build over it soon.

Sequence questions

The sequence also raises questions about the ongoing Supplementary Environmental Impact Statement (SEIS) process for Atlantic Yards, in which Empire State Development, the state agency overseeing the project, is supposed to examine the community impacts of multiple potential sequences.

While the forthcoming Scope of Analysis, a prelude to the issuance of a Draft SEIS, will surely mention the once-promised clockwise buildout east from the arena block, which would mean prompt construction over the railyard, that seems completely unrealistic, given Forest City's announced plans.

So, while the southeast block remains formally part of Phase 2 in the state plan, Forest City for business purposes considers it part of its first phase.

Forest City's empty claims

To the New York Observer, company spokesman Joe DePlasco claimed that sequencing for Phase 2 had yet to be determined. But the new documents confirm Forest City's plans to build first on Block 1129. And DePlasco's claim that there is still a construction deadline for the new railyard is irrelevant, since the question is when they'd build an expensive deck over that railyard.

The news further undermines that misguided New York Times article last April, which stated:
For Forest City Ratner... the [retail] changes are evidence that the arena has already met its goal of transforming a dreary section of Brooklyn — the Long Island Rail Road’s rail yards and surrounding industrial buildings, which the company’s spokesman described as “ a scar that divided the neighborhood.”
Stated in October, confirmed yesterday

Forest City Ratner executive MaryAnne Gilmartin last October told investment analysts "we have seven buildings that we will build before we commence construction on any platform buildings."

From the report; click on graphic to enlarge
In the FCE annual report 10-K filed yesterday with the Securities and Exchange Commission, the company offered a new interpretation of the Atlantic Yards phases, which according to state documents have been separated by Sixth Avenue, leaving the arena block and adjacent Site 5 (across Flatbush Avenue) in Phase 1 and all buildings east of Sixth Avenue in Phase 2.

The annual report stated:
Phase I of Brooklyn Atlantic Yards  is comprised of eight buildings totaling approximately 3.4 million square feet—four buildings on the Arena Block (adjacent to the Barclays Center ) and four buildings on Block 1129. Phase II consists of seven buildings totaling approximately 3.3 million square feet—three buildings on Block 1120, three buildings on Block 1121 and one building on Block 1128.
(Emphasis added)

While Gilmartin said "seven buildings" and the annual report said eight, in actuality, there could be nine buildings in the new Phase 1: four buildings on the southeast block, four on the arena block, and one on Site 5, currently home to P.C. Richard and Modell's.

Given that the flagship tower at Flatbush and Atlantic avenues is slated to be an office tower, for which there is no market, and Site 5 may be an office tower, it sounded like Gilmartin was being cautious.

The irony, of course, is that initial plans in 2003 for Atlantic Yards completely omitted the southeast block of the site, as indicated in the graphic above, which was limited to the arena block and then the two blocks to the east containing the rest of the Vanderbilt Yard.

Why was that southeast block added? Likely for construction staging, parking, and to increase the amount of development.

SEIS impact?

The 10-K states:
As a result of ongoing litigation, a Supplemental Environmental Impact Statement ("SEIS") is required to be completed before proceeding with a portion of Phase I and all of Phase II of the project. We do not expect that the current ongoing litigation and SEIS process will affect the development of the four buildings located on the Arena Block within Phase I.
Again note this reinterpretation of the notion of Phase 1. ESD's June 2009 Modified General Project Plan describes the Phase 1 site as the "portion of the Project Site west of 6th Avenue" and the Phase 2 site as the portion east of 6th Avenue.

Will new railyard, deck be built?

Such regulatory documents are supposed to disclose risks, whatever the likelihood, and this one raises questions about the railyard:
A substantial amount of additional costs for railyard and infrastructure improvements will be required to proceed with Phase II of Brooklyn Atlantic Yards. More specifically, there is an upcoming December 31, 2013 deadline to commence construction on the Permanent Railyard and to post the completion guaranty for such work. If we choose to begin construction on the Permanent Railyard by December 31, 2013, it must be substantially completed by September 30, 2016. We have previously provided an $86 million letter of credit to the Metropolitan Transit Authority ("MTA") as collateral for such future work related to the construction of the Permanent Railyard. In order to construct the aforementioned eight buildings in Phase II, we will be required to construct a platform over the new Permanent Railyard.
Alternatively, if we do not commence construction on the Permanent Railyard by December 31, 2013, we will be in default of various MTA project agreements and the MTA will have the ability to draw down our $86 million letter of credit. We would also lose approximately 3.3 million square feet of development rights for Phase II of Brooklyn Atlantic Yards.
Will Forest City give up $86 million and 3.3 million square feet of development rights? Unlikely. The developer can lobby for more subsidies to shift the risk. They can always wait to build those development rights. Also, as the document relates,  the Company may elect to pursue future vertical development of this project with joint venture partners."

And, I'd add, they could always lobby the MTA to revise the deal, as they did with the original Vanderbilt Yard deal.

Still, if everything goes wrong, FCE could face $600 million in losses, including liquidated damages for failure to the city and state of New York to meet certain deadlines for the first few towers.

Modular risks

The new modular technology used in the first Atlantic Yards tower, and the factory to build modules, add development risk, including pressure from unions:
We have partnered with a large international development and construction company to operate a facility for the fabrication of apartment modular units that will be used in the construction of B2 BKLYN,  a multi-family highrise in Brooklyn, New York, which is expected to be 32 stories and contain 363 apartment units.
In addition to risks inherent in construction projects generally, such as unanticipated site conditions, environmental, and force majeure issues, the following additional risks exist with setting up the modular facility and constructing B2 BKLYN using modular methodology:
• Facility start-up costs can be more than anticipated, which would require additional equity;
• The facility setup might take longer than anticipated, which would lead to the delay of the completion of B2 BKLYN;
 • High rise modular has not previously been done at the heights of B2 BKLYN ; therefore, the design may need to be revised and assembly may not occur as expected, each having the potential to cause project delays and additional construction costs;
• Our partner could experience financial difficulty and be unable to cover its share of cost overruns, which could impact the timely completion of the project or require us to infuse additional equity;
• Third party claims that any element of the design or construction methodology infringes on protected intellectual rights could delay the project and increase construction costs; and
• A plumbers' organization has requested the City Building Department to explain its issuance of permits and approvals for the production of modules at the facility where the modular units will be constructed, in light of New York City building code licensing requirements. Any claim or claims filed in connection with this request could delay the construction, and increase the construction costs, of B2 BKLYN.
I reported in January on the questions raised by unions and trade associations representing plumbers.


Popular posts from this blog

Barclays Center/Levy Restaurants hit with suit charging discrimination on disability, race; supervisors said to use vicious slurs, pursue retaliation

The Daily News has an article today, Barclays Center hit with $5M suit claiming discrimination against disabled, while the New York Post headlined its article Barclays Center sued over taunting disabled employees.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with  referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

Behind the "empty railyards": 40 years of ATURA, Baruch's plan, and the city's diffidence

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At a hearing yesterday of the Brooklyn Borough Board Atlantic Yards Committee, Kate Suisma…

No, security guards can't ban photos. Questions remain about visibility of ID/sticker system.

The bi-monthly Atlantic Yards/Pacific Park Community Update meeting June 14, held at 55 Hanson Place, addressed multiple issues, including delays in the project, a new detente with project neighbors,concerns about traffic congestion, upcoming sewer work and demolitions, and an explanation of how high winds caused debris to fly off the under-construction 38 Sixth Avenue building. I'll have more coverage.
Security issues came up several times at the meeting.
Wayne Bailey, a resident who regularly takes photos and videos (that I often use) of construction/operations issues that impact residents, asked representatives of Tishman Construction if the security guard at the sites they're building works for them.
After Tishman Senior VP Eric Reid said yes, Bailey asked why a guard told him not to shoot video of the site, even though he was on a public street.

"I will address it with principals for that security firm," Reid said.
Forest City Ratner executive Ashley Cotton, the …

Atlantic Yards/Pacific Park graphic: what's built/what might be coming + FAQ (post-dated pinned post)

This graphic, posted in January 2018, is post-dated to stay at the top of the blog. It will be updated as announced configurations change and buildings launch. Note the unbuilt B1 and the proposed shift in bulk to the unbuilt Site 5.

The August 2014 tentative configurations proposed by developer Greenland Forest City Partners will change. The project is already well behind that tentative timetable.

How many people are expected?

Atlantic Yards/Pacific Park has a projected 6,430 apartments housing 2.1 persons per unit (as per Chapter 4 of the 2006 Final Environmental Impact Statement), which would mean 13,503 new residents, with 1,890 among them in low-income affordable rentals, and 2,835 in moderate- and middle-income affordable rentals.

That leaves 8,778 people in market-rate rentals and condos, though let's call it 8,358 after subtracting 420 who may live in 200 promised below-market condos. So that's 5,145 in below-market units, though many of them won't be so cheap.

As …

The passing of David Sheets, Dean Street renter, former Freddy's bartender, eminent domain plaintiff, and singular personality

David Sheets, longtime Dean Street renter, Freddy's bartender, eminent domain plaintiff, and singular personality, died 1/17/18 in HCA Greenview Hospital in Bowling Green, KY. He was 56.

There are obituary notices in the Bowling Green Daily News and the Wichita Eagle, which state:
He was born in Wichita, KS where he attended public Schools and Wichita State University. He lived for many years in Brooklyn, NY, and was employed as a legal assistant. David's hobby was cartography and had an avid interest in Mass Transit Systems of the world. David was predeceased by his father, Kenneth E. Sheets. He is survived by his mother, Wilma Smith, step-brother, Billy Ray Smith and his wife, Jane all of Bowling Green; step-sister, Ellen Smith Alexander and her husband, Jerry of Bella Vista, AR; several cousins and step-nieces and step-nephews also survive. Memorial Services will be on Monday, January 22, 2018 at 1:00 pm with visitation from 10:00 am to 1:00 pm Monday at Johnson-Vaughn-Phe…

Some skepticism on Belmont hockey deal: lease value seems far below Aqueduct racino; unclear (but large?) cost for LIRR service

As I wrote for The Bridge 12/20/1, The Islanders Say Bye to Brooklyn, But Where Next?, the press conference announcing a new arena at Belmont Park for the New York Islanders was "long on pomp... but short on specifics."

Notably, a lease valued at $40 million "upfront to lease up to 43 acres over 49 years... seems like a good deal on rent for the state-controlled property." Also, the Long Island Rail Road will expand service to Belmont.

That indicates public support for an arena widely described as "privately financed," but how much? We don't know yet, but some more details--or at least questions--have emerged.

An Aqueduct comparable?

Well, we don't know what the other bid was, and there aren't exactly parcels that large offering direct comparables.

But consider: Genting New York LLC in September 2010 was granted a franchise to operate a video lottery terminal under a 30 year lease on 67 acres at Aqueduct Park (as noted by Gov. Andrew Cuomo).


Barclays Center event June 11 to protest plans to expand Israeli draft; questions about logistics

At right is a photo of a poster spotted in Hasidic Williamsburg right. Clearly there's an event scheduled at the Barclays Center aimed at the Haredi Jewish community (strict Orthodox Jews who reject secular culture), but the lack of English text makes it cryptic.

The website explains, Protest Against Israeli Draft of Bnei Yeshiva Rescheduled for Barclays Center:
A large asifa to protest the drafting of bnei yeshiva in Eretz Yisroel into the Israeli army that had been set to take place this month will instead be held on Sunday, 17 Sivan/June 11, at the Barclays Center in Downtown Brooklyn, NY. So attendees at a big gathering will protest an apparent change of policy that will make it much more difficult for traditional Orthodox Jewish students--both Hasidic (who follow a rebbe) and non-Hasidic (who don't)--to get deferments from the draft. Comments on the Yeshiva World website explain some of the debate.

The logistical questions

What's unclear is how large the ev…