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Forest City Q2 results silent on Pacific Park; 38 Sixth nudged back; 461 Dean outpaces 535 Carlton

In a press release yesterday, Forest City Reports 2017 Second-Quarter and Year-to-Date Results, indicating improved second-quarter net earnings and other metrics.

But the real message came on what was not said--nothing about future plans for Pacific Park Brooklyn.

"We remain confident in our ability to deliver solid full-year 2017 results and achieve meaningful progress towards our long-term strategic goals," CEO David LaRue stated, predicing improved results and an increased dividend.

"We continuously monitor the changing market dynamics we face in the real estate investment marketplace," he said. "We also recognize that we have been, and continue to be, in an extended economic cycle and must continue to exercise prudent and disciplined capital allocation to new development. Given current conditions, we intend to reduce the upper limit of our development ratio from 10 percent to approximately 7.5 percent of total assets."

Translation: they're cautious about building. Perhaps investment analysts will ask during today's conference call.
 
38 Sixth Avenue nudged back

The press release states:
38 Sixth Avenue, a 303-unit, all-affordable apartment community with 6,000 square feet of street-level retail at Pacific Park Brooklyn that is part of the company's strategic partnership with Greenland USA, is expected to begin phased opening in the third quarter of 2017.
That means by September. I have my doubts. After all, in a press release this past May regarding first-quarter results, Forest City said the building was expected to begin phased opening in the second quarter of 2017.

Parking on the southeast block of the site is also supposed to open in Q3.

461 Dean leasing faster

As of 4/27/17, as I wrote in May, 461 Dean, the first building to open, was 39% leased, and 535 Carlton was 21% leased. As of 7/23/17, as shown in the graphic below, 361 Dean was 77% leased and 535 Carlton was 36% leased.

Regarding 535 Carlton, that's a fairly slow lease-up for a 100% affordable building, isn't it? Regarding 461 Dean, which is a 50% affordable building, presumably most if not all of the affordable units have been leased. If so, the market-rate units, which began leasing last October, are going fairly slowly.

That said, the steady increase from 36% leased to 77% leased suggests that affordable applicants finally got processed faster, and/or that lease concessions helped move the market-rate units.

From investor presentation (download)

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