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Atlantic Yards/Pacific Park graphic: what's built/what's coming + FAQ (pinned post)

In worthy new book on homeless mother in Brooklyn, an unsteady cameo for Ratner, the Barclays Center, and Atlantic Yards

I recently read the affecting journalistic account of a young single mother's struggle with homelessness, Lauren Sandler's This Is All I Got: A New Mother's Search for Home

(See the enthusiastic New York Times review, which put it on the newspaper's list of 100 Notable Books of 2020, and a somewhat more critical take from the New York Review of Books. More reviews from the author's web site.)

Sandler, a Brooklynite, meets the woman she calls Camila at a shelter on the edge of Park Slope and follows her through her quest: to find a home, navigate the city bureaucracy, go to school, explore her roots in the Dominican Republic, and navigate fraught relationships with her family and (ex-)boyfriends.

It's a valuable, closely-observed reminder that secure housing is bedrock to our existence, that the bureaucracy can be petty and cruel, and that the "system" makes no allowances for imperfect people who lack safety nets.

The Atlantic Yards angle

And while I know this is quibbling, I think the book also involves--briefly--what I term"Atlantic Yards down the memory hole," given the unsteady cameo for the Barclays Center, developer Bruce Ratner, and the Atlantic Yards project.

It's not unreasonably for Sandler to contrast that new arena project with the struggles of ordinary people.  I just wish she'd been more careful about details--there are no source notes--and recognized some ironies.

She makes the indubitable point that we're a wealthy country and city, that wealth and poverty are juxtaposed uneasily, and that we have the means--though not the will--to combat homelessness.

A successful family

One chapter begins with a happier immigrant family story, that of Harry Ratowczer in Cleveland, whose son  Bruce became a successful mayoral Commissioner in New York City, then moved into real estate development, building the billion-dollar MetroTech complex in Downtown Brooklyn.

She writes:
MetroTech was merely a precursor to what Ratner had in mind for the borough: a million-square-foot development proposal for a plot of land down Flatbush Avenue. The project was announced in 2003 and would take three thousand days to complete. The financing would rely on $100 million in tax breaks. Furthermore, it would require taking advantage of the state's power of eminent domain. Fifty-one community organizations opposed the development, claiming it could displace nearly three thousand residents.
(Emphases added)

Well, let's look at my FAQ. Atlantic Yards was announced at 8 million square feet, with the arena block nearly a third of that. A span of 3,000 days is only about 8.2 years; the project was originally--and overoptimistically--said to take ten years, but could take 25 years, and that's starting the clock in 2010, not 2003. 

The project, including the arena, would relay on way more than $100 million in tax breaks: direct state and city subsidies for the arena were $305 million (or $285 million), plus significant tax breaks, tax-exempt financing, and exemptions from property taxes. Then there are various subsidies and tax breaks for the residential project.

As to the opposition, yes, many groups signed on, but a more subtle point was that certain prominent community organizations and leaders supported the Atlantic Yards project, thinking it could help counteract gentrification and provide a new model for equitable development. 

That didn't happen, but it's worth recognizing, since it makes the Atlantic Yards saga more poignant.

About the arena, Ratner, and Jay-Z

From the book:
The centerpiece of the project, and the first building to be constructed, was the Barclays Center, which would house the Nets basketball franchise. Its Brooklyn industrial chic would be expressed in a facade of quick-rusting steel, its roof planted with enough grassy sedum to carpet a large public park.

The development project cost a billion dollars. That figure didn't include the cost of the team itself. Ratner partnered with Jay-Z to buy the Nets for $300 million. The arena would be erected across an intersection from a two-bedroom apartment that was Jay-Z's former stash spot, before rap began to pay his bills. The former drug den hit the market for $1.5 million shortly after Barclays opened its doors. Later that year, Ratner declared that real estate development and investments had earned him $10.5 billion in assets.
Well, the green roof was part of the original arena plan, ditched during initial development, then restored after the arena opening as an add-on exoskeleton, largely to tamp down escaping bass.

The green roof is 135,000 square feet--about three acres, so not a large park. The arena project, including infrastructure, did cost $1 billion, but the full Atlantic Yards/Pacific Park project, with 15 or 16 towers, has a much larger price tag: it started at $2.5 billion and now could cost $6 billion.

Yes, Ratner (and partners) paid $300 million for the Nets, which was at one time onerous but now--after sales to Mikhail Prokhorov and then Joe Tsai--the irony is not that Ratner paid (seemingly) big money but how much of the upside Ratner missed.

That makes Ratner, rather than a savvy businessman, a lousy one or, at least, one constrained by poor timing and the umbrella of a large, publicly-traded company that had to answer quarterly to shareholders focused on short-term results.

As to Jay-Z's former drug den, I'm not sure what unit at 560 State Street Sandler was referring to, but a quick search turns up this 1/28/14 Curbed article, saying the owner wanted $870,000 for it. (Unit 10C ultimately sold for $930,000.) I couldn't find any units at 560 State Street that, as of the arena's late 2102 opening, were asking for more than $1 million; that took until 2016.

Did Ratner declare "that real estate development and investments had earned him $10.5 billion in assets." No. First, assets aren't earned but rather acquired, often with debt. 

Second, those assets weren't held by Bruce Ratner. He headed Forest City Ratner (later Forest City New York), part of the larger, and far more valuable, Forest City Enterprises, which was publicly traded, with partial ownership by the extended Ratner family. This 3/29/12 press release says Forest City Enterprises--not the New York subsidiary--is an NYSE-listed national real estate company with $10.5 billion in total assets.

About Prokhorov

The book also cites the extravagant wealth of incoming Nets majority owner Mikhail Prokhorov:
Around the time Prokhorov was becoming a majority owner of the team representing Brooklyn, he took up residence in a penthouse apartment in the Four Seasons Hotel in Manhattan and put a deposit down on a $750 million villa in France. The villa was named for its previous owner, King Leopold II of Belgium, and required a staff of fifty to maintain its manicured gardens. Prokhorov decided he didn't want the house after all and forfeited his $68 million down payment. 
That's in the clip file, sure.

The passage continues:
That loss was chump change to a man who was about to sell his $2 billion stake in a fertilizer company and almost $1 billion more in aluminum--all with an eye toward Brooklyn. Already Prokhorov owned a reported $3 billion in real estate in the borough, much of it down the street from the shelter where Camila lived. In 2009, Prokhorov purchased his partners' interest in the team and the Barclays Center. Ratner wanted to move on to focus on the next stage of his adjoining massive development project, which years later would remain an eight-and-a-half acre pit next to the stadium, on Atlantic Avenue.
As to Prokhorov's purchase, that was the first transaction, which was announced in 2009 and closed in 2010: 80% of the team, and 45% of the arena company. Only in late 2015 did Prokhorov agree to fully buy out Ratner.

Prokhorov didn't own any real estate other than his share of the arena company and later, the HSS Training Center in Sunset Park's Industry City, worth about $50 million. He wisely never exercised the option to buy 20% of Atlantic Yards.

As to Ratner moving on to focus on real-estate, yes, but... not quite. First, consider that "pit." The western third of the 8.5-acre railyard was subsumed for the arena block. So the "pit"--which continues--occupies about two-thirds of that.

But the "next stage" of development on the overall 22-acre site would involve construction on not that "pit" but on terra firma: adjacent sites on the arena block, plus the southeast block of the Atlantic Yards site, between Carlton and Vanderbilt avenues and Pacific and Dean streets. 

In other words, Ratner--with a new development partner, Greenland USA, which took the lead--did build for that next stage, albeit slower than promised. Greenland in 2014 bought a 70% stake going forward, building three towers together. 

As of 2018, after the arena and four towers--one exclusively by Forest City--were built, Greenland bought out most of Forest City's stake, then leased three sites to other developers, one as a partnership.

NYCHA, plus more perspective

From the book:
That sinkhole of billions [apparently referring to the "pit"] opened up at the front door of the underfunded, overcrowded, and collapsing last hope for permanent housing for thousands upon thousands of desperate New Yorkers,... the Brooklyn office for the New York City Housing Authority.
Yes, that's an irony: the NYCHA office at 787 Atlantic Avenue (part of the 470 Vanderbilt building) does offer a contrast for the unbuilt project. 

To go deeper into the irony, however, would be to point out that people not unlike protagonist Camila--single mothers who rallied under the banner of ACORN--put great stock in the promise of Atlantic Yards affordable housing.

That too was a missed opportunity.