Skip to main content

Atlantic Yards down the memory hole: LIRR improvements being delivered "free of charge," declares Newsday

I'm coming a little late to this Newsday article posted 3/22/15, headlined LIRR to get improvements in Brooklyn, part of Barclays deal.

But it clearly represents the phenomenon I've dubbed "Atlantic Yards down the memory hole," since the indubitable improvements have been part of renegotiation and delay:
The $100 million real estate deal that led to the Barclays Center being built over a century-old rail yard is beginning to pay dividends for the Long Island Rail Road and its Brooklyn commuters, officials said.
Seven years into the construction of a state-of-the-art new storage facility to replace the original Vanderbilt Yards, workers will soon punch through a 171-year-old rail tunnel to provide trains, for the first time, a direct path between the yard and Atlantic Terminal.
It's one of many improvements to the LIRR's Brooklyn operation that are being delivered to the railroad free of charge by Greenland Forest City Partners, a joint venture between Greenland and Forest City Ratner, developer of the Barclays Center and adjacent Pacific Park residential project.
"A project like this has to be a win-win for everybody," said Ratner vice president Thomas Bonacuso, who heads the project. "Brooklyn has become a brand. Brooklyn is hot. We and the railroad capitalized on that and were able to bring improvements to their rail yard that wouldn't have been possible under their own resources."
Well, wait a second. It's not free. The improvements are part of a deal in which the MTA/LIRR sold 3.6 million square feet of development rights to Forest City at a figure well below the appraised value of $75 per buildable square foot. 

That said, the appraiser surely undervalued the cost of the replacement railyard and deck needed to build housing, subtracting $56.7 million to reach an appraised value of $214.5 million.

The deal was renegotiated in 2009 to allow a smaller permanent railyard, an initial payment of $20 million, and a new deadline, giving the developer until 2031 to pay off the additional $80 million, at a gentle 6.5% interest rate. 

Since then, the timetable for the affordable housing has been moved up to 2025, which means the railyard parcels will be purchased faster than allowed in the 2009 renegotiation, but still slower than originally promised.

Since then, the value of the development rights has skyrocketed, to perhaps $350 per square foot. The MTA, despite advice from the mainstream Regional Plan Association, refused to consider any clause in the renegotiated contract to take advantage of any upswing in the market.

According to Newsday, "Ratner officials declined to disclose the project's cost." What we do know is that, in 2009, the MTA said the new railyard would be valued at $147 million, while Dellaverson said the previous iteration could be worth $250 million, after inflation.

So it's tough to measure the cost of the infrastructure against the value of the development rights. But the process was never clean, and the improvements surely aren't free.

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…

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 …

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…

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

Click on graphic to enlarge. This is post-dated to stay at the top of the blog. It will be updated as announced configurations change and buildings launch. The August 2014 tentative configurations proposed by developer Greenland Forest City Partners will change, and the project is already well behind that tentative timetable.


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 …