Skip to main content


Showing posts from 2017

From the latest Construction Update: progress toward replacing huge fence; median restoration on Atlantic continues

According to the latest Atlantic Yards/Pacific Park Construction Update (bottom), covering the two weeks beginning November 20, was circulated at 4:45 pm Friday (lead time) by Empire State Development (ESD) after preparation by Greenland Forest City Partners, there's a modest amount of new work compared to the previous period, but it will be noticed.

Most prominently, outside the B12 site (aka 615 Dean) next to 550 Vanderbilt, "Work related to grading the site in preparation of replacing 16ft fence will commence."

Neighbors, as well as members of the Atlantic Yards Community Development Corporation, have pushed to have that fence--ostensibly to protect against noise and dust from construction--moved back, given that there's no construction. The new plan was finally announced at the Atlantic Yards/Pacific Park Quality of Life meeting last week.

Work on Atlantic Avenue

The improvement of Atlantic Avenue near and beyond the Barclays Center continues:
The lane shift on ea…

NYT columnist notes 535 Carlton "affordable" units "go begging"; missing: previous skepticism amid boosterism

So, "New York Times Big City" columnist Ginia Bellafante, who writes weekly in the Metropolitan section, today offers At $3,700 a Month, ‘Affordable’ Apartments Go Begging, describing how the mayor's ambitious affordable housing plan has been criticized for offering too many below-market apartments to those between "51 to 165 percent of the median income for the metropolitan area, or from $43,000 to upward of $141,000 for a family of three. "

(Let's pause for a moment and acknowledge the vast difference even within that scale, since those in lower half of that cohort find far more trouble on the private housing market.)

Her target is a building that's been in the news. She writes:
The fate of a building at 535 Carlton Avenue in Brooklyn, would suggest that they are right. The building was developed with all 300 of its units designated as affordable and available to prospective tenants through a city housing lottery. Half the apartments, though, were sla…

Ripple effect in Brooklyn as Greenland USA pulls back on investments elsewhere?

From CoStar, 11/15/17, Greenland Exits NoHo Metro Development:
The American subsidiary of Chinese developer Greenland Group has backed out of negotiations for the massive 1.9 million-square-foot, mixed-use project at North Hollywood's Red Line Metro stop.

Greenland USA and Trammell Crow Co., the Dallas-based development subsidiary of CBRE Group, Inc., were originally selected for joint negotiations last May by the Los Angeles County Metropolitan Transportation Authority.

The two firms were expected to enter into exclusive discussions for developing the 15.6-acre project around the North Hollywood Metro station at Lankershim Blvd. As proposed, the project would include two high-rise residential towers - a 300,000-square-foot, mid-rise office building and 140,000 square feet of retail shops and restaurants. Greenland USA instead will focus on a project in South San Francisco, the Landing at Oyster Point, according to CoStar, but Greenland is also negotiating with Kilroy Realty Corp. …

Post puffs 38 Sixth among "cheapest... chicest" housing; reality: 1,876 households applying for 152 costly middle-income units

Yesterday, the New York Post published a sunny real estate roundup, NYC’s cheapest housing might be its chicest, prominently featuring two "100% affordable" buildings within Atlantic Yards/Pacific Park, 38 Sixth and 535 Carlton.

That's 38 Sixth leading off with the two images on the first page, the interior and then the exterior view. From the article:
Greenland Forest City Partners — a joint venture with Greenland USA — is developing Brooklyn’s Pacific Park, which includes two new affordable addresses. “Whether it’s market-rate, mixed or affordable, we want to create a sense of community … and then everyone becomes invested in the home.”
One of the Pacific Park buildings, the SHoP Architects-designed 38 Sixth Ave., opened in August. All of its 303 units are priced below market-rate for individuals making between $20,126 and $173,415.
(A studio is as low as $532, and a three-bedroom as high as $3,695, for those who met the income requirements and won the lottery.) Note …

Barclays Center rep claims non-ticketed events not listed on neighborhood calendar for security reasons (nah)

It's a small but significant change in Barclays Center operation: not since May 2016 has the arena circulated a monthly calendar that includes non-ticketed events, indicating the timing and expected crowd size.

And that leaves arena neighbors unprepared for crowds and traffic from events like graduations or religious gatherings.

At the bimonthly Atlantic Yards/Pacific Park meeting 11/14/17, the question of restoring such cordial notices came up again, and Sarah Berlenbach, the Director of External Affairs for Brooklyn Sports & Entertainment, gave a new but not-so-convincing answer.

Claim: It's about security

“This has come up before in these meeting, and we continue to stand by the decision to not publish many events, unless we expect there to interference with the quality of life," she said. "Think of the graduations that came in and had people like Hillary Clinton and Bernie Sanders... Any time there might be a security threat we don’t want increased attention o…

Developer: remaining green wall on Dean Street finally going down. Plans unclear for site next to 550 Vanderbilt.

Finally, the remaining portion of the huge, street-encroaching green fence on Dean Street is going down, as developer Greenland Forest City Partners acknowledged last night that it has no immediate plans for the Atlantic Yards/Pacific Park parcel it is protecting.

The 16-foot wall/fence, twice as high as typical, was ordered by Empire State Development (ESD), the state authority overseeing and shepherding the project, to protect neighbors from noise and dust during construction.

Portions of the wall, which once extended between Carlton and Vanderbilt avenue, have lingered for some three years, vexing neighbors especially as the rationale for its presence has diminished. Letters from the Dean Street Block Association and questions raised at the Atlantic Yards Community Development Corporation (AY CDC) were long met with claims from ESD that the fence was needed.

Speaking at the bi-monthly Atlantic Yards/Pacific Park Quality of Life meeting last night (also see coverage of project'…

Conundrum: state official has no info on project timetable but says 2025 affordable housing deadline will be met

At last night's bi-monthly Atlantic Yards/Pacific Park Quality of Life meeting, the few project neighbors present got a seemingly confident but not-at-all-definitive overview of the project from
Tobi Jaiyesimi.

She serves as both Executive Director of the Atlantic Yards Community Development Corporation and Atlantic Yards/Pacific Park Project Director for the parent Empire State Development, thus essentially advising herself.

“In terms of the overall length of what the project development schedule is, that I can’t provide for you," she said. "Just know that the project is sticking to one of its major commitments, in terms of making sure that we’re able to provide the affordable housing by 2025, making sure that we’re able to maintain 30% affordability throughout the length of the project."

The conundrum

That's a bit of a conundrum. If new buildings remain delayed, well, that May 2025 housing deadline get harder to meet. There are seemingly significant penalties of…

Despite long waits to sell $2M+ condos in Brooklyn, Greenland Forest City didn't cut prices at 550 Vanderbilt but maneuvered lowering cost of ownership

Selling a luxury condo in Brooklyn? You could be in for a long wait, The Real Deal reported yesterday, saying units asking for $2 million-plus have been on the market an average of 249 days, or more than eight months.

Well, how does that apply to 550 Vanderbilt? Sales of some units launched in June 2015, Curbed reported, and sales presentations in China began that month, though later September 2015 was called the official launch.

So it's been at least 26 months, or maybe 29 months. By my calculations, based on public documents, only 10 of 55 units listed for $2 million-plus have sold, though it's certainly possible that some sales are in process.

Lowering the cost of ownership, though not cutting prices

Given slow sales, many condo sponsors would cut prices. The Real Deal reported that sellers were "taking an average price cut of 24 percent on listings for $2 million or more during the third quarter of 2017," according to Miller Samuel data.

But Greenland Forest City …

Coming around Barclays and other major venues: more NYPD cops, with new rifles

MSG, Barclays to get ‘Commando’-equipped cops amid terror concerns, the New York Post reported last night: Specially trained NYPD officers armed with high-powered rifles will soon be assigned to every event at the city’s major stadiums to combat potential terror, The Post has learned.
In the coming weeks, Madison Square Garden in Manhattan and Brooklyn’s Barclays Center will each be stocked with more than a dozen officers from their local station houses — Midtown South and the 78th Precinct — during any sports games, concerts or other events, law-enforcement sources said.
The newly assigned officers recently underwent a two-week training course, then a second instructional session, to familiarize themselves with the semiautomatic Colt M4 Commando rifles that they will carry while on-duty, sources said. They'll also be wearing special tactical uniforms, the Post reported. The question is how long this will continue, and how many officers will be deployed.

And if the cost isn't as…

New market-rate studios and one-bedrooms at LIC complex $300+ below "affordable" 535 Carlton

From Multi-Housing News, 11/9/17, Lightstone Completes Long Island City Development:
Real estate investor and developer Lightstone has completed ARC, a 428-unit apartment property at 30-02 39th Ave. in the Dutch Kills section of Long Island City in Queens....
Studios are available starting at $1,800, with one bedrooms starting at $2,300 and two bedrooms starting at $3,500. Those rents are less than the average in Long Island City, which is the most expensive rental market in Queens, according to MNS.
According to MNS’ October 2017 report on Queens’ rental market, studios average $2,408 in Long Island City. One-bedroom units average $3,030, while two-bedroom units fetch an average of $4,060. Do note that the "affordable" studios at 535 Carlton, many of them not taken in the housing lottery, rent for $2,137, 1-bedrooms for $2,680, 2-bedrooms for $3,223, and 3-bedrooms for $3,716.

Sure, 535 Carlton is a better location--though next to future noisy construction for a while--than…

Reuters: smaller Equity Residential approaches Forest City regarding merger

Reuters reported in an exclusive 11/10/17, Exclusive: Equity Commonwealth approaches Forest City about merging - sources:
Equity Commonwealth (EQC.N), a U.S. real estate investment trust (REIT) focused on office space and chaired by property mogul Sam Zell, has approached Forest City Realty Trust Inc (FCEa.N) to discuss a possible merger, people familiar with the matter said.
Combining the two companies would create an office- and apartments-focused REIT worth more than $10 billion, making it one of the biggest mergers in the sector this year. Forest City is open to a potential merger ever since it began a process to consider divestiture or transformation. It should be noted that Equity is a much smaller company, albeit with much less debt, with a market capitalization (total value of stock) of $3.77 billion, while Forest City has a market cap of $6.65 billion.

Alternatively, Forest City has total assets of $8.12 billion, and then liabilities (including debt) of $4.32 billion and tota…

Issues for Tuesday's Quality of Life meeting: that giant fence, and open space at Times Plaza

The agenda (right) for Tuesday's bi-monthly Atlantic Yards Quality of Life meeting is typically vague, as it indicates reports from Empire State Development (ESD), the state authority overseeing/shepherding the project; the Atlantic Yards Community Development Corporation (AY CDC), which is supposed to oversee ESD; and Greenland Forest City Partners, the developer.

I've already suggested that one question that might/should be answered is whether or not another building will start by the end of the year, as Greenland USA--but not its joint venture partner Forest City New York--has indicated is likely. Time is marching on.

If another building does not start, one pending question is whether the giant green wall encroaching on part of Dean Street between Carlton and Vanderbilt avenues (below) should be pulled back, an issue ventilated vaguely at the last AY CDC meeting. It's supposed to mitigate against construction noise and dust, but there's no construction; still, ESD …

The Real Deal's Shanghai Showcase: EB-5 defender calls it job creation program; reticence regarding money-moving tactics

The Real Deal's recent Shanghai showcase offered a few nuggets of interest, according to the publication's coverage. Consider this talk about EB-5 investor visas:
The EB-5 visa program was the subject of the second featured panel talk, with United States Immigration Fund’s Nicholas Mastroianni giving a rundown on the legislative threats to EB-5 and the likely reforms coming down the pipe. He tried to make the case that the US government should treat EB-5 as a job creation program instead of an investment vehicle for rural and underserved communities, and pointed to the fact that the overwhelming majority of Chinese EB-5 investors choose to put their money in high-end urban projects.
“You can choose the Marriott Hotel in Springfield, Illinois… or are you going to build a Times Square hotel built by a 200 million dollar company?” he said. (Emphases added)

Except last year, at the very same showcase, Mastroianni--who's twice raised money for Atlantic Yards/Pacific Park, and a…

Will another Atlantic Yards/Pacific Park building start by end of year? Perhaps we'll learn next week.

Will another Atlantic Yards/Pacific Park residential tower start before year end? We've had no announcement, despite hints, though there is a business argument.

Despite Oversupply, Developers Say Time To Build Apartments Is Now, Bisnow reported 11/6/17, given the gap in time between construction--during a glut in Manhattan and Brooklyn--and opening:
"Experienced developers realize now is the time to develop,” Alchemy Properties founder Ken Horn said at Bisnow’s New York City State of the Market event last week. “Hard costs are coming down now and contractors are a little hungrier. Building permits have gone down in the last two years about 70 to 80%.” The problem, Horn said, is that lenders are looking at the glut, rather than the pipeline.

"There’s a great deal of talk about oversupply in the rental marketplace and that’s particularly acute in some areas, like Downtown Brooklyn," Rose Associates Chief Operating Officer Brian Peters said, according to Bisnow. "T…

As de Blasio cruises to re-election, new subsidies to build condos and co-ops (remember AY pledge?)

Yesterday's election, in New York City at least, seemingly means more of the same, with all the key incumbents re-elected, with little drama. As the New York Times put it, in De Blasio Coasts to Re-election, as Second-Term Challenges Await:
Yet Mr. de Blasio’s ability to deliver on his agenda may have far more to do with the winds blowing out of Washington and Albany than with circumstances in the five boroughs.
Federal budget cuts — threatened by President Trump and the Republican-led Congress, especially to social programs, health care and public housing — could cause serious problems and exacerbate social ills, forcing Mr. de Blasio to do financial triage. That could potentially drain money from signature programs, like his promise to accelerate and expand a push to build and preserve affordable housing. Similarly, Jarrett Murphy wrote in City Limits, The Election Changed Nothing in NYC. But Change is Coming All the Same.:
The city’s population is growing. While the 2006 PlaNY…

From the latest Construction Alert: new street lights outside 38 Sixth; overnight deliveries coming to railyard

According to the latest Atlantic Yards/Pacific Park Construction Update (bottom), covering the two weeks beginning November 6, was circulated at 11:36 am yesterday (late) by Empire State Development (ESD) after preparation by Greenland Forest City Partners, there's a modest amount of new work compared to the previous period.

Outside B3, aka 38 Sixth Avenue, work to install a traffic control device (a new traffic light?) and street lights will begin.

At the Vanderbilt Yard, "delivery of Tunnel Double Slip Switch Panels will occur during this reporting period. The Panels will arrive at the site during an overnight period (oversized loads) and stored on Pacific Street. Switches will be lowered into the yard via a crane stationed on Atlantic Avenue during normal hours the following day."

No date has been announced. Nor was any disruptiveness described, but overnight deliveries can be loud.

Saturday and after-hours work

Saturday work could occur at the B12 site (615 Dean). The…

Despite coverage of 535 Carlton lottery flop and qualms about expensive affordable units, uncritical promotion of "new generation"

It seems clear that the happy talk upon the opening of the "100% affordable" 535 Carlton-- “Our administration is delivering on the affordable housing this community was promised," Mayor Bill de Blasio said in June--was overstated.

As I previouslyreported, and Rachel Holliday Smith of DNAinfo expanded on (also published in City Limits, as DNAinfo+Gothamist closed and briefly unpublished everything), the housing lottery failed to deliver takers for the middle-income units that represent half the building, because, well, few people apply for such relatively expensive units.

So it was surprising to see such sheep-like, press release-driven coverage like today's article in Metro, 535 Carlton offers ‘new generation of affordable housing’ for middle-income New Yorkers.

Only at the end of the article do we learn that studios rent for $2,137, 1-bedrooms for $2,680, 2-bedrooms for $3,223, and 3-bedrooms for $3,716, and are open to households within relatively limited income …

So, were affordable units at B2 "by far the largest infusion of affordable housing in Brooklyn at one time? Nah.

Apparently, I missed--er, wasn't sent--this apparent press release (screenshot below) when it came out, 12/13/12, and reproduced on several sites, FIRST MODS HOISTED INTO PLACE IN WORLD’S TALLEST MODULAR BUILDING:
B2 in Brooklyn 50% Affordable
Brooklyn, NY – December 12, 2013 – Forest City Ratner Companies (FCRC), the developer of Atlantic Yards in Brooklyn, announced today that construction teams will hoist into place the first mods that will be part of B2, the 50-percent affordable building that will be the tallest modular building in the world when it is completed in the 4th Quarter of 2014. 181 of B2’s 363 units will be affordable, by far the largest infusion of affordable housing in Brooklyn at one time. (Emphasis added)

By far the largest infusion of affordable housing in Brooklyn at one time? Even if they were talking about the overall planned 2,250 below-market units in Atlantic Yards/Pacific Park, that doesn't make sense.

Doesn't Starrett City have 5,881 apartments

Forest City executive: though selling 461 Dean, they see "compelling values" in Brooklyn, despite "supply issues"

Despite plans to sell 461 Dean, the only building in Atlantic Yards/Pacific Park that they own outright, Forest City Realty Trust executives yesterday told investment analysts they remain bullish in Brooklyn residential real estate, despite near-term challenges.

(461 Dean is also the only building built via modular construction, a process Forest City once had great hope in, but abandoned after delays in construction, a dispute with former partner Skanska, and reports of leaks.)

Asked if the motivation to sell was more about the tax advantages, or concerns about the fundamentals for real estate in Brooklyn, Chief Financial Officer Bob O'Brien said during a conference call that it was the former:  a recognition of the ability to use tax losses to counter corporate gains from selling retail assets.

The increased $44.3 million impairment (on top of a $146 million impairment regarding the building and the modular factory), he said, "really reflected the challenges of really unders…

Forest City selling 461 Dean (only building they own 100%), plans to take tax loss; 535 Carlton just 51% leased

There's some very interesting news within the press release issued yesterday, Forest City Reports 2017 Third-Quarter and Year-to-Date Results, which indicated increased net earnings and funds from operations.

They're selling--though no deal has been reached--461 Dean (aka B2), the ill-fated modular tower that is the only building owned 100% by Forest City Realty Trust/Forest City New York. Otherwise, it has a 30% share in Greenland Forest City Partners, which excludes the arena.

Not only are they selling, they're taking a loss. "The second impairment, $44.3 million related to 461 Dean Street in Brooklyn, stems from of our recent decision to market this consolidated property for sale, resulting in a change in our hold assumptions," stated CEO David LaRue. "Disposition of the asset would generate a tax loss that we can use to offset gains from our in-process retail transactions, while also generating significant cash proceeds for further debt reduction or othe…

With new financial controls from China, "premature sales" of U.S. projects by Chinese developers?

Chinese Property Shopping Spree Fades as Beijing Hits the Brakes, the Wall Street Journal reported 10/31/17 (also on Fox Business), noting that policies since late last year "have been tightening restrictions on overseas investments and scrutinizing some of the country's most ambitious deal makers, voicing concerns that deals in certain sectors were disguises for capital flight into havens."

And that means, those interviewed by the WSJ said, "there could be premature sales of Chinese-led American projects." One example: a potential sale of part of a south San Francisco project by Greenland USA, which bought the project only in August 2016.
Greenland didn't deny its plans, but did tell the WSJ that "China's capital controls will have a certain impact on immature companies," implying it was excluded.
But that raises the question, not addressed in the article: is Greenland USA selling, or considering selling, any more of its 70% share (minus the …