Atlantic Yards down the memory hole: Gilmartin, pitching project in Richmond, suggested "public trust" in Brooklyn has been honored

It's Atlantic Yards down the memory hole, yet again.

In N.Y. developer MAG Partners co-leads team pitching for Diamond District project, Richmond BizSense reported 4/19/22 on the bid (one of six) by "New York-based MAG Partners and Seattle-based MacFarlane Partners... for the mixed-use redevelopment of city-owned land that would include a replacement of The Diamond baseball stadium."

MAG Partners, of course, is led by MaryAnne Gilmartin, former CEO of Forest City Ratner/Forest City New York. Another partner on the team: MSquared, a firm founded by Alicia Glen, who as deputy mayor under Bill de Blasio worked with Gilmartin.

The Brooklyn effect

MAG Partners' bid was not among the three chosen as finalists, as announced in early May. Still, that April interview is worth a deeper look:

While different in market and scale, Gilmartin said the 67-acre Diamond District project is similar to the 8-acre Pacific Park Brooklyn development that’s anchored by Barclays Center, home to the NBA’s Brooklyn Nets and WNBA’s New York Liberty.

“It really was the cornerstone to kick off the overall large-scale development, because it’s got public purpose and delivers a ton for the community. We see the Richmond RFP in a very similar way,” she said.

Hm, there was no RFP for the Atlantic Yards project in Brooklyn, just a belated RFP for the MTA's Vanderbilt Yard development rights, after public officials essentially promised it to Forest City. The railyard represents some 8.5 acres of the 22-acre project site.

From the article:

“It was a controversial project in its inception. One of the reasons why I think it’s been widely accepted by people in Brooklyn is that it is a very good neighbor, in terms of the way it’s been planned, the way it was constructed, the way that it operates. All of that was due to the work we put in for years and years.”

Note: Atlantic Yards/Pacific Park very much remains unfinished. 

As to "very good neighbor," well, the arena is not as bad a neighbor as many had feared, given that the long wait to build it meant far fewer New Jersey fans driving to Brooklyn, but those in the surrounding blocks might beg to differ.

And as to "widely accepted," well, those supporting the project because of the promised affordable housing might beg to differ.

Public trust

From the article:

Gilmartin said her team would take a similar approach to the Diamond District, bringing with it lessons they learned from over a decade working on Barclays and Pacific Park Brooklyn.

“The only way to really know how to do it is to have done it,” she said. “All of that experience will be brought to bear in Richmond. The public trust that underlies that commitment needs to be honored, and that’s something that I think we are uniquely capable of doing.”

What does that even mean? Forest City was supposed to build the project in ten years. Forest City was supposed to build the affordable housing for as many low-income households as middle-income ones. Forest City was supposed to finish the project itself, not exit in favor of a company owned, significantly, by the government of Shanghai. Forest City was supposed to cure "blight" by covering the open railyard.

None of that happened.

Rising in the Power 100

On 5/16/22, the Commercial Observer ranked Gilmartin #45 in its Power 100, up from #50, crediting MAG Partners for what Gilmartin called "a billion-dollar development pipeline," including two apartment buildings on and office building in Manhattan. The staff has doubled from 5 to 10.

It also cited a 177-acre project in Baltimore known as Port Covington.

Building in Baltimore

A 5/10/22 press release, SAGAMORE VENTURES AND GOLDMAN SACHS ASSET MANAGEMENT ANNOUNCE EXPANSION OF THE PORT COVINGTON DEVELOPMENT TEAM, describes MAG Partners' new role:

Sagamore Ventures and the Urban Investment Group within Goldman Sachs Asset Management (Goldman Sachs) today announced an addition to the development and investment team for Port Covington that brings together two of the leading woman-owned and Black-owned development firms in the country, MAG Partners and MacFarlane Partners. The addition of the MAG and MacFarlane team brings national experience that will focus on leasing, marketing and placemaking campaigns. Weller Development Company (WDC) will continue to focus on the construction of Chapter 1B, the 1.1 million- square-foot phase currently underway.

The MAG Partners and MacFarlane Partners team will lead the future development efforts outside of Chapter 1B and continue with the vision and transformation of the 177-acre South Baltimore project, with an approved master plan consisting of up to 14 million square feet of mixed-use development and 40 acres of open space across 45 new city blocks. The new development teams are direct investors leading all leasing, as well as future development and construction.

It sounds like either the financing arm decided to replace the developer, and/or the latter wanted to exit. 

Two new developers take over Port Covington project as Weller Development exits, Baltimore Business Journal reported 5/10/22, noting that the new team would "launch an immediate marketing and leasing campaign for the five office, retail and residential buildings now under construction."

In a 5/25/22 interview in SouthBmore.com, Gilmartin said her team started as an advisor and then "fell in love" with the project.

From the article:

“I spend a lot of time in Brooklyn. Baltimore has the kind of grit and possibility Brooklyn has. I love the underdog status, ” said Gilmartin. 

She said it wasn’t easy to lure companies to Brooklyn but said they were able to create a “sense of place” which led to the momentum Brooklyn is seeing now.

Wait a sec. The companies lured to MetroTech were attracted by significant tax breaks to stay in New York City, as well as a corporate campus atmosphere in an urban area. The "sense of place" had already been created in adjacent residential districts.

And the "grit and possibility" Brooklyn had/has was always coupled with its connection, via subway, to Manhattan. Not quite the same in Baltimore.

Looking at the firm's website

The MAG Partners website uses, shall we say, Trumpian "truthful hyperbole" to credit "OUR RECORD" with buildings developed by Forest City, involving many others who do not happen to work today for Gilmartin's vastly smaller company:

• The New York Times Building 
• New York by Gehry 
• The Tata Innovation Center 
• MetroTech Center 

Regarding the arena, it states:

Barclays Center, a state-of-the-art sports and entertainment venue in the heart of Brooklyn, is the centerpiece of the Pacific Park Brooklyn master development. A creative collaboration with music legend JAY-Z, the arena was designed by SHoP Architects and is credited with revitalizing the surrounding area and bringing professional sports back to Brooklyn.

Funny, but it's not really state-of-the art 10 years later. And while Jay-Z certainly added his tastemaking chops, his role was hyped well beyond his contribution.

Regarding the project, it states:

Pacific Park Brooklyn is an eight million square foot master plan development that includes 14 mixed-income residential buildings, commercial, and retail space. When completed, Pacific Park Brooklyn—groundbreaking in its scale and ambition for the borough—will span eight acres and cover the Vanderbilt Rail Yard. Pacific Park’s first four residential buildings were designed by SHoP and COOKFOX Architects and opened in 2017.

Hmm... groundbreaking in scale and ambition, but far less so in conception, execution, and oversight.

About public private partnerships

From the web site:

The MAG Partners team has decades of experience executing successful public-private partnerships and bringing to life transformational masterplans. Members of the team have been relied upon by New York City and State governments to produce development and infrastructure projects that deliver benefits to the community, including high levels of MWBE participation and quality permanent and construction jobs, with a special emphasis on local hiring. MAG Partners has a dedicated and experienced in-house lobbying capability, giving MAG Partners access to policymakers in New York City and Albany – a unique advantage for New York projects. A core capability of the MAG Partners team is its expertise in developing community support and achieving successful public approvals for projects. As experts in New York City Uniform Land Use Review Procedure (ULURP) and New York State General Project Plans (GPP), MAG Partners has vast experience entitling projects and navigating complicated regulatory environments.

A core capability is "developing community support." Perhaps, but by any means necessary?

The equity partner

A company like MAG Partners needs a financing partner, and a PincusCo interview with Head of Development Susi Yu (another former Forest City exec) offers some insight, in response to a question about a woman-owned firm:

70 percent of our firm is made up by women, which we are very proud of. We are very committed to diversity and it is something we practice not just with our team but also with other partners we deal with. For example, we demand with our consultants that there are women who are interfacing with ownership representing their firms. You know they’re at the office doing all the work but they’re not getting the opportunity to interface with ownership or developers, and that’s how you grow business, so that is something that we do demand of our consultants. It is the same with our equity partners, our LP partner out of Australia, Qualitas, is an investment firm that was started by a woman named Carol Schwartz. We want to make sure that everyone who we work with understands what our goals and values are. That’s something that is really important for us.

In a 10/23/20 MAG Partners press release about the financing of a 480-unit development in Chelsea, Qualitas was described thusly:

Qualitas is one of Australia’s leading real estate investment management firms specialising in real estate equity and debt investing. Established in 2008, the firm has invested in or financed assets valued at over $8.5 billion since inception. The firm invests across the capital structure in senior debt, mezzanine debt, preferred equity and equity with a focus on development, value add, opportunistic and structured investments. Qualitas manages discretionary funds on behalf of institutional and wholesale clients in Australia, Asia, and Europe.