Skip to main content

Ratner on Nassau Coliseum: "We're giving the municipality money... all privately financed" (plus Barclays offers "intangible" element of pride)

CNBC's Squawk Box yesterday took on Faceoff for Nassau Coliseum facelift, featuring one of the two bidders, Bruce Ratner, whose team is competing against one assembled by Madison Square Gardens.

"First of all, it will be beautiful like the Barclays Center," Ratner said of the Coliseum plans. "Second, it will have a huge number of events. The whole deal today is content, content. We will have 300 events there, 200 are already booked. That's been the strength of our Barclays Center."

Yes, and several Barclays Center shows should go to Nassau. But do note that the plans for Nassau include 83 "parking lot events," which is not exactly the model in Brooklyn.

Ratner said there's "almost no overlap from Barclays," in that 5-10% of Barclays Center customers come from Long Island, which has 3 million people and prosperous counties. "It's a tremendously strong market. I cannot emphasize how strong that market is."




Subsidies? 

"What kind of subsidy will you ultimately be getting to do this?" Ratner was asked. "How much is the government going to have to put forward?

"This is one of those opposites," Ratner replied. "We're giving the municipality money, not a nickel from the municipality, all privately financed, all privately done. The county will make lot of money from this. In terms of economic impact and in terms of rent."

Nothing for roads?

"One of the great things--it's surrounded by a huge number of roads," Ratner replied. "There's millions of people that go by every day. There's no infrastructure needed. After all, it was a Coliseum before and it is now, so no additional roads and so on. So, actually, it's ready to be done, it is centrally located. I cannot emphasize what kind of incredible location it is and what kind of incredible population."

Hold on. It's never that simple. First, Ratner didn't mention if there would be tax-exempt bonding or other discounts on financing.

More importantly, the deal is not simply that "we're giving the municipality money." Developers of the Coliseum would be required to give Nassau County a percentage of the gross revenue from arena events, and that percentage has not been discussed.

In other words, Ratner (and MSG) would not be building a new arena. They'd be financing a renovation, then taking the lion's share of the new revenues. It's like taking on a new business partner who (I'd bet) gets a larger share of revenues than his actual investment, thanks to his innovative ideas.

So the devil is in the details, and we haven't seen them.

Building local economies?

"Do you buy the argument that these arenas can actually create and build local economies around them?" Ratner was asked. "Because in some areas, it's worked. In some areas, it really hasn't."

Ratner, after responding affirmatively, saw his host confirm, "Brooklyn has been a success."

"Brooklyn has been a success," Ratner repeated, "both in terms of what it is and in terms of local businesses, yes, yes, yes, it does."

Creating and building a local economy? Puh-leeze. Helping some bars and restaurants, sure, but otherwise no.

Perhaps recognizing the flimsiness of his answer, Ratner, as he continued, switched tacks. "But I have to add something: there's the intangible that content provides, making citizens feel proud of their place, making citizens feel like there's a place to go. Entertainment--it has an intangible calculations aside from the economic. People miss that. If we build an opera house, everyone says, great, great, great, it's wonderful. Now we're building an arena, which provides everything from concerts to family shows to boxing to sports. So there is an intangible element that I think is often missed about content and arenas. People only look as at it economically.

That "intangible" value is invoked mainly regarding sports teams and the local pride they can engender. Now Ratner's applying that to the building. I wouldn't deny that some people are proud of "Brooklyn's arena," but his formulation is still a stretch. Opera houses and movie theaters don't get the enormous government help this arena got, either.

Comments

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…

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 Matzav.com 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…

Atlanta's Atlantic Yards moves ahead

First mentioned in April, the Atlantic Yards project in Atlanta is moving ahead--and has the potential to nudge Atlantic Yards in Brooklyn further down in Google searches.

According to a 5/30/17 press release, Hines and Invesco Real Estate Announce T3 West Midtown and Atlantic Yards:
Hines, the international real estate firm, and Invesco Real Estate, a global real estate investment manager, today announced a joint venture on behalf of one of Invesco Real Estate’s institutional clients to develop two progressive office projects in Atlanta totalling 700,000 square feet. T3 West Midtown will be a 200,000-square-foot heavy timber office development and Atlantic Yards will consist of 500,000 square feet of progressive office space in two buildings. Both projects are located on sites within Atlantic Station in the flourishing Midtown submarket.
Hines will work with Hartshorne Plunkard Architecture (HPA) as the design architect for both T3 West Midtown and Atlantic Yards. DLR Group will be t…

Not quite the pattern: Greenland selling development sites, not completed condos

Real Estate Weekly, reporting on trends in Chinese investment in New York City, on 11/18/15 quoted Jim Costello, a senior vice president at research firm Real Capital Analytics:
“They’re typically building high-end condos, build it and sell it. Capital return is in a few years. That’s something that is ingrained in the companies that have been coming here because that’s how they’ve grown in the last 35 years. It’s always been a development game for them. So they’re just repeating their business model here,” he said. When I read that last November, I didn't think it necessarily applied to Atlantic Yards/Pacific Park, now 70% owned (outside of the Barclays Center and B2 modular apartment tower), by the Greenland Group, owned significantly by the Shanghai government.
A majority of the buildings will be rentals, some 100% market, some 100% affordable, and several--the last several built--are supposed to be 50% market/50% subsidized. (See tentative timetable below.)

Selling development …

Forest City acknowledges unspecified delays in Pacific Park, cites $300 million "impairment" in project value; what about affordable housing pledge?

Updated Monday Nov. 7 am: Note follow-up coverage of stock price drop and investor conference call and pending questions.

Pacific Park Brooklyn is seriously delayed, Forest City Realty Trust said yesterday in a news release, which further acknowledged that the project has caused a $300 million impairment, or write-down of the asset, as the expected revenues no longer exceed the carrying cost.

The Cleveland-based developer, parent of Brooklyn-based Forest City Ratner, which is a 30% investor in Pacific Park along with 70% partner/overseer Greenland USA, blamed the "significant impairment" on an oversupply of market-rate apartments, the uncertain fate of the 421-a tax break, and a continued increase in construction costs.

While the delay essentially confirms the obvious, given that two major buildings have not launched despite plans to do so, it raises significant questions about the future of the project, including:
if market-rate construction is delayed, will the affordable h…

"There is no alternative": DM Glen on de Blasio's affordable housing strategy

As I've written, Mayor Bill de Blasio sure knows how to steer and spin coverage of his affordable housing initiatives.

Indeed, his latest announcement, claiming significant progress, came with a pre-press release op-ed in the New York Daily News and then a friendly photo-op press conference with an understandably grateful--and very lucky--winner of an affordable housing lottery.

To me, though, the most significant quote came from Deputy Mayor Alicia Glen, who, as the Wall Street Journal reported:
said public housing had been “starved” of federal support for years now, leaving the city with fewer ways of creating affordable housing. “Are we relying too heavily on the private sector?” she said. “There is no alternative.” Though Glen was using what she surely sees as a common-sense phrase, it recalls the slogan of a politician with whom I doubt de Blasio identifies: former British Prime Minister Margaret Thatcher, a Conservative who believed in free markets.

It suggests the limits to …