Will Greenland sell more of Atlantic Yards/Pacific Park? Unclear, but Chinese firms face changing policy
As I wrote in April 2015, surveying the "the vigorous (and potentially precarious) ambitions of the new Atlantic Yards majority owner," it's worth recalling a warning at a 3/28/14 board meeting of ESD, the gubernatorial-directed authority that oversees and shepherds Atlantic Yards.
Gib Veconi of the Prospect Heights Neighborhood Development Council focused on the state’s failure to consider the option of bringing in other developers. The pending Greenland transaction would not represent a multiple-developer strategy, Veconi observed, but rather a single-source development project, one "under the control of a partner exposed to one of the world’s most volatile economies.”
Indeed. We have seen Greenland grow significantly, by one metric the fastest-growing company in the world (!) , yet also pulling back on multiple fronts, in California and in Brooklyn. It has sold development leases to three Pacific Park sites to two companies, The Brodsky Organization and TF Cornerstone.
As I noted last September, upon the revelation that two developers would take over three sites, the multiple developer alternative--at least one that involved unwinding the existing transactions--was in 2014 dismissed by ESD, as impractical and ineffective. But when the developer makes the deal, it's apparently OK.
Will Greenland sell any more pieces of Atlantic Yards/Pacific Park? Who knows. Maybe we'll learn a little about the developer's plans, including an updated timetable for each building, at today's meeting of the Atlantic Yards Community Development Corporation (AY CDC), which, by the way, now has Veconi as a member. That timetable was requested in January 2018 but never delivered.
A volatile economy
But the overall investment framework for the company remains in flux. This past December and then January, I cited news coverage about how Chinese investors, in general, are backing away.
And consider this 2/25/19 sponsored feature in Mingiandi.com, which covers Chinese real estate news:
In other words, a volatile economy.
Gib Veconi of the Prospect Heights Neighborhood Development Council focused on the state’s failure to consider the option of bringing in other developers. The pending Greenland transaction would not represent a multiple-developer strategy, Veconi observed, but rather a single-source development project, one "under the control of a partner exposed to one of the world’s most volatile economies.”
Indeed. We have seen Greenland grow significantly, by one metric the fastest-growing company in the world (!) , yet also pulling back on multiple fronts, in California and in Brooklyn. It has sold development leases to three Pacific Park sites to two companies, The Brodsky Organization and TF Cornerstone.
As I noted last September, upon the revelation that two developers would take over three sites, the multiple developer alternative--at least one that involved unwinding the existing transactions--was in 2014 dismissed by ESD, as impractical and ineffective. But when the developer makes the deal, it's apparently OK.
Will Greenland sell any more pieces of Atlantic Yards/Pacific Park? Who knows. Maybe we'll learn a little about the developer's plans, including an updated timetable for each building, at today's meeting of the Atlantic Yards Community Development Corporation (AY CDC), which, by the way, now has Veconi as a member. That timetable was requested in January 2018 but never delivered.
A volatile economy
But the overall investment framework for the company remains in flux. This past December and then January, I cited news coverage about how Chinese investors, in general, are backing away.
And consider this 2/25/19 sponsored feature in Mingiandi.com, which covers Chinese real estate news:
Outbound real estate investments by Chinese companies slid 63 percent last year to reach a four year low of $15.7 billion in 2018, according to a report just released by Cushman & Wakefield Greater China Research.That said, according to James Shepherd, Managing Director of Greater China Research, Cushman & Wakefield, some two-thirds of respondents to the firm's survey cited those capital controls: “While this shows the effect of government policy, it also indicates that a lack of investor demand was not the reason behind the change, which leaves the door open to a rapid recovery in deal volumes, should policy or the debt situation change in the future."
The biggest barrier to purchasing overseas property assets is proving to be the mainland government’s ongoing controls on debt and outbound capital flows, according to Cushman & Wakefield’s findings.
In other words, a volatile economy.
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