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Perfectly obscure: Greenland Forest City is "fully committed" to Pacific Park (after delays), won't share updated timetable

Click here for more coverage of the AY CDC meeting.

Executives behind Pacific Park Brooklyn appeared today at a public meeting of a body set up to advise the state on the project--and got away without having to offer any specifics regarding announced delays.

The action began at about 34:40 of the video below, a meeting of the Atlantic Yards Community Development Corporation (AY CDC), held at the Manhattan office of the parent Empire State Development, the state authority overseeing and shepherding the project.

Forest City Ratner executive Ashley Cotton acknowledged that parent Forest City Realty Trust (FCRT) recently announced an "impairment"--a write-down in asset value--of some $300 million, and that the project was delayed beyond the previously assumed 2025 finishing date. (That acknowledgment formalized what was obvious, given the failure to start buildings on the previous, tentatively announced schedule.)

"The impairment," she said, is an "accounting requirement and does not change our ongoing commitment to the project." And while that was absorbed by FCRT, her statement was on behalf of the joint venture Greenland Forest City Partners, which is 70% owned by Greenland USA, an arm of the Shanghai-based Greenland Group.

"But the most important thing to be crystal clear about is that the Greenland Forest City joint venture is fully committed to Pacific Park and our obligations under our government agreements," Cotton said. "We have specific obligations that we must and will adhere to. And we are actively working to achieve those goals."

She didn't delineate the obligations, but they include a new Vanderbilt Yard to store and service Long Island Rail Road trains, annual sums to pay for railyard development rights, and a May 2025 deadline for the project's affordable units, about 1,470 (out of 2,250) of which remain to be built. That deadline comes with $2,000/month fines for each unit not built.

Leaving it vague

"With that many buildings coming on the market, the joint venture of course has to evaluate the appropriate time to make substantial investments into new vertical buildings," Cotton said. " Even though the Pacific Park development plan is predetermined, we still think of each new building as a new investment. And while the overall schedule is fixed"--note the uptick in her voice, a seeming "tell"--"and we will meet it, there is flexibility in terms of the individual buildings, especially given the amount of work under way already."

My October 2016 annotation of a previous, tentative timetable.
She cited the challenges facing developers, including rising construction costs for projects built with 100% union labor, the uncertainty around 421-a tax subsidies, and a development cycle with a significant amount of market-rate units.

"We don't have a crystal ball, but together as a joint venture, we are making decisions daily to best position the project and bring it to completion," Cotton said. "While we do not have an updated construction schedule to hand out and review... We are actively meeting all the goals identified... we remain committed to meeting all the requirements of the project and look forward to Pacific Park coming into life even more."

Obligation for candor?

No member of the board pressed Cotton on the timetable. While community commenters aren't allowed to pose questions, one pointed to the need for candor.

During the public comment period, Gib Veconi of the Prospect Heights Neighborhood Development Council, pointed out that Forest City executives had publicly stated, on a conference call with investment analysts, that they're using a 2035 date to analyze the project's economics. (I've observed that that doesn't necessarily mean a 2035 completion date, but rather when project cash flows stabilize.)

"It’s a public private partnership," he said, which means the public has a right to know more. "I think the developers have an obligation to share the assumptions behind it with their public partners."


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