Atlantic Yards/Pacific Park in 2023: the year of renegotiation? Platform, affordable housing deadline, Site 5 in question. Big finish for Brooklyn Nets?

As I wrote in my 2022 wrap-up yesterday, the year was marked by false starts on long-delayed platform over the Vanderbilt Yard, which would've enabled the first tower over the railyard, B5 (aka 700 Atlantic Ave.) and get developer Greenland Forest City Partners (GFCP) part of the way toward meeting its obligation to complete 2,250 affordable housing units by May 31, 2025.

Instead, none of the required 876 (or 877) units launched, which means the developer would by the deadline face $2,000/month fines for each missing unit, as established in a 2014 agreement. 

At least if Empire State Development (ESD), the gubernatorially-controlled authority that oversees/shepherds the project, decides to--and/or is pressured to--enforce the agreement, rather than invoking a "right to refrain" in the project's Development Agreement.

The renegotiation?

GFCP surely has no interest in paying such fines, so it's likely seeking an extension--based on the failure to renew the 421-a tax break?--and/or preparing a renegotiation of the overall project terms.

That could involve--I speculate, as I did last year--a proposal to build a giant project at Site 5, longtime home of Modell's and P.C. Richard, moving bulk from the unbuilt "Miss Brooklyn" tower once planned to loom over the arena. 

(Note: that wouldn't be all the bulk from Miss Brooklyn, so some might be shifted to the remainder of the project, allowing larger towers over the railyard.)

The carrot might be deeper affordability--which would set up a debate about whether a project some 50% bulkier (as previously proposed) than the already anomalously large 80 Flatbush (aka The Alloy Block) project deserves such tradeoffs.

That also could involve the waiving of the fines, which would total $10 million by this May, for not building the Urban Room, the atrium bridging Miss Brooklyn and the arena. 

ESD has already made no effort to enforce those fines, but has pledged to pursue more open space--perhaps, as proposed by the BrooklynSpeaks coalition during its Crossroads charettes last year, within the Site 5 complex. 

Or who knows, GFCP, owned nearly in full by Greenland USA, could be seeking a bailout for the costs of constructing the platform and/or could be waiting for interest rates to subside.

Also a replacement for the expired 421-a tax break will be proposed by Gov. Kathy Hochul; if passed by the legislature, it could make future towers more viable. 

The black box here is Greenland USA's Shanghai-based parent Greenland Holdings, which is struggling financially and has seen its credit rating plummet. It answers to local political interests, and may prioritize completion of domestic projects. 

Notably, as I wrote, ESD has no evidence of required financial reports from Greenland, the project's guarantor. If Greenland goes into default, that could stall the project.

What's coming: housing, open space (and maybe platform)

If the platform does start, the first railyard block--bounded by Sixth and Carlton avenues, and by Atlantic Avenue and Pacific Street--will be surrounded by fencing, constraining traffic and eliminating parking. The B5 tower would start a year later. But that still wouldn't meet the 2025 deadline.

Early this year, 595 Dean (B12/B13), two towers on the southeast block, should open, and also begin the affordable housing lottery. Despite obfuscation by developer TF Cornerstone, we know the units will be aimed at middle-income households earning six figures, at 130% of Area Median Income (AMI).

595 Dean website

What we don't know is how those "affordable" rents will be set; the most recent buildings to open, Brooklyn Crossing (B4, 18 Sixth Ave.) and Plank Road (B15, 662 Pacific St.) set different discounts from the city's allowable guidelines, each recognizing that the maximum rents would be untenable.

Watch to see if the housing lottery starts before the market-rate units lease up; if not, residents of the latter units will get a significant head start.

The opening of 595 Dean will mean a much larger segment of the project's open space, as construction fences separating the adjacent 535 Carlton and 550 Vanderbilt will be removed, and there will be dog runs, pathways, and places to sit. 

It will be interesting to see how much/how well that space is used, if/when noisy work catercorner, on the first railyard block, begins. (Noisier work would be on the second railyard block, immediately to the north, but that's years away.)

We didn't learn anything new last year about the much-delayed work revamping Times Plaza, which was required as a mitigation under the 2014 Supplemental Environmental Impact Statement. Will it finally proceed?

What's coming: retail and more

By June, Chelsea Piers should open a giant fitness center/fieldhouse at 595 Dean; that should be a magnet for visitors from a larger area, so keep an eye on traffic snags on Dean Street, especially since the blocks' 303-unit parking garage, accessible via a sole Dean Street entrance just east of Carlton Avenue (at 535 Carlton), will add 455 spaces. 

That may be especially acute when the Brooklyn Nets reach the playoffs.

Also opening at 595 Dean will be Simo Pizza, but there's another retail space yet to lease. At 461 Dean, flanking the arena, Just Salad should open; another retail space remains to lease.

At 38 Sixth Avenue, a retail space at Dean Street, long occupied by construction teams, may open up--or perhaps it will be used for platform work, if it begins. 

No retail tenants have yet been announced for 18 Sixth Ave. (aka Brooklyn Crossing), though an Equinox may be coming.

Outside the project footprint, nearby spots remain in question: will the Triangle Building at Fifth and Flatbush avenues be renovated, as announced, to house a branch of Rihanna's Savage x Fenty lingerie shop? Will a major space on Pacific Street near Flatbush become a Walgreen's, as announced?

How well will the bike corral outside the Shake Shack and Chik-fil-A on Flatbush just past Pacific work? Will drivers still double-park, narrowing Flatbush to one late?

Accountability questions

The project's limited accountability declined even more in 2022, with an unprecedented skipping of a bi-monthly scheduled Quality of Life meeting, and the less unusual failure to schedule two quarterly meetings of the (purportedly) advisory Atlantic Yards Community Development Corporation.

Both are fora for at least some transparency, though follow-up questions are typically not allowed at the bi-monthly meetings, and few of the AY CDC members have anything but surface knowledge.

A new real estate VP at Empire State Development must get up to speed on this and other projects.

The coalition BrooklynSpeaks, essentially led by a handful of people, has the ear of local elected officials, some of whom attended the Crossroads charettes last winter and a July press conference regarding the failure to build the Urban Room--which was really more about that 2025 housing deadline.

BrooklynSpeaks does not necessarily speak for the full spectrum of opinion, so presumably any attempt to move forward on Site 5, and/or a project negotiation, will involve a larger range of people. That said, expect some new proposals on the project from BrooklynSpeaks (more on that soon).

If a plan emerges to extend the project timetable or otherwise protect GFCP from those fines, that deserves significant public discussion--not a backroom deal.

Press coverage will continue to be very sporadic, beyond this blog.

Beyond the footprint

The Atlantic Avenue Mixed-Use Project (AAMUP), the successor to what Community Board 8 called M-CROWN, is proceeding, aiming to rezone the area just east of Vanderbilt Avenue, the eastern end of the Atlantic Yards/Pacific Park footprint, with not only higher densities but also civic investments, including open space and road improvements.

Meanwhile, several spot rezonings on or near Atlantic Avenue that passed have not yet led to buildings going vertical. Given the deadline to complete new buildings by June 15, 2026 to take advantage of the 421-a tax break, we should see some buildings start.

About the Nets

The Brooklyn Nets' remarkable turnaround during the first half of the 2022-23 season puts them in a position for a deep playoff run, even a championship--subject, of course, to injuries and/or a Kyrie Irving-related crisis. That could mean congestion near the project's limited parking garages.

If so, expect Mayor Eric Adams and others to get on a Nets bandwagon. What elected official wouldn't want to join a parade, even if you're only rooting for the clothes? And expect Irving to negotiate a lucrative new contract with the Nets.

A successful Nets season might bring team owner Joe Tsai closer to his bold, and seemingly unattainable goal of nearly tripling team revenue. Along with new revenue streams, that could include a buyout of Barclays, enabling the arena operator (Tsai's company) to sell naming rights for far more than the $10 million a year Barclays pays.

What's the 2023 surprise?

Perhaps a new timetable, a new plan, and a new agreement with the state. A boost from Mayor Eric Adams for deeper affordability? Greenland going into default?

If there's a new arena naming rights agreement, well, we'll have to get used to not just a new name, but also a new naming rights plan for the transit hub--right?