At Atlantic Yards Community Development Corp. meeting, questions about Site 5. New subcommittee to make recommendations for project's future.
This is the second of three articles on the Jan. 23, 2024 meeting of the (purportedly) advisory Atlantic Yards Community Development Corporation (AY CDC). The first concerned the project's stalled progress. The third concerned whether parent ESD's oversight of the EB-5 loans was sufficient.
As reported yesterday, Atlantic Yards Community Development Corporation Director Ron Shiffman, a veteran advocacy planner and former City Planning Commissioner, pushed for Empire State Development (ESD), the state authority that oversees/shepherds the project, to proactively prepare for changes in ownership and in the plan.
Arden Sokolow, ESD’s Executive Vice President, Real Estate and Planning, noted that they were constrained by project agreements. “This is not a blue sky opportunity.”
Shiffman said he understood that, but that ESD should be prepared for Greenland’s request to avoid liquidated damages of $25-$26 million a year”—the $2,000/month penalty for each affordable housing unit not delivered by May 2025. Of 2,250 required units, 876 (or 877) have not yet started.
If developer Greenland USA comes back and requests concessions to save money, Shiffman advised, “you need to know what path you're going to take as an agency that represents the people of the State of New York in delivering what was an obligation to the community.”
“We hear your request,” Sokolow said. “We will continue to talk with you.” (Here's the video of the meeting.)
Community engagement?
AY CDC Director Gib Veconi noted that, at the August meeting, ESD was considering hiring a consultant for a community engagement exercise, related to the developer’s long-floated plan to shift bulk from the unbuilt B1 tower, once slated to loom over the arena at Flatbush and Atlantic Avenues, to Site 5, catercorner to the arena and currently home to the big-box stores P.C. Richard and the now-closed Modell’s.
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That could create a giant, two-tower project, with some 1.1 million square feet.
As reported yesterday, Atlantic Yards Community Development Corporation Director Ron Shiffman, a veteran advocacy planner and former City Planning Commissioner, pushed for Empire State Development (ESD), the state authority that oversees/shepherds the project, to proactively prepare for changes in ownership and in the plan.
Arden Sokolow, ESD’s Executive Vice President, Real Estate and Planning, noted that they were constrained by project agreements. “This is not a blue sky opportunity.”
Shiffman said he understood that, but that ESD should be prepared for Greenland’s request to avoid liquidated damages of $25-$26 million a year”—the $2,000/month penalty for each affordable housing unit not delivered by May 2025. Of 2,250 required units, 876 (or 877) have not yet started.
If developer Greenland USA comes back and requests concessions to save money, Shiffman advised, “you need to know what path you're going to take as an agency that represents the people of the State of New York in delivering what was an obligation to the community.”
“We hear your request,” Sokolow said. “We will continue to talk with you.” (Here's the video of the meeting.)
Community engagement?
AY CDC Director Gib Veconi noted that, at the August meeting, ESD was considering hiring a consultant for a community engagement exercise, related to the developer’s long-floated plan to shift bulk from the unbuilt B1 tower, once slated to loom over the arena at Flatbush and Atlantic Avenues, to Site 5, catercorner to the arena and currently home to the big-box stores P.C. Richard and the now-closed Modell’s.
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That could create a giant, two-tower project, with some 1.1 million square feet.
Joel Kolkmann, ESD’s Senior VP, Real Estate and Planning, said it hadn’t happened. “Given where the project is currently and who the real stakeholders are in executing the project,” he said, “we don't see that the communication process at this moment would be that fruitful, without assurance of development partner who is positioned to fully execute that.”
MTA completion bond?
Veconi noted that, at the August AY CDC meeting, the Metropolitan Transportation Authority and the developer had agreed to the terms of the completion bond for platform construction, the precursor for the six towers over the railyard, but MTA had not yet received the financial commitment.
Has that been delivered? Kolkmann said no.
Project progress
Pycior said that 3,212 apartments, including 1,374 affordable ones, had been constructed, and the B12/B13 complex, which is marketed as 595 Dean, has been completed, as have three acres of open space.
Developer TF Cornerstone is still leasing both market rate and the affordable units. For the latter, “they are working through the HPD lottery selections.”
MTA completion bond?
Veconi noted that, at the August AY CDC meeting, the Metropolitan Transportation Authority and the developer had agreed to the terms of the completion bond for platform construction, the precursor for the six towers over the railyard, but MTA had not yet received the financial commitment.
Has that been delivered? Kolkmann said no.
Clearly, Greenland is not yet ready to move forward. Beyond its own financial struggles, the absence of the 421-a tax break (or a successor), plus high interest rates, makes it tough to work financially.
What about Site 5?
Site 5, noted Veconi, is not in default. Nor is Greenland in default under the Development Agreement.
So what would happen if Greenland asked ESD’s permission to sell that development lease to another developer. (It has previously sold the leases to B15, B12, and B13, while also partnering with another developer on B4. In all cases, that meant a cash infusion.)
What about Site 5?
Site 5, noted Veconi, is not in default. Nor is Greenland in default under the Development Agreement.
So what would happen if Greenland asked ESD’s permission to sell that development lease to another developer. (It has previously sold the leases to B15, B12, and B13, while also partnering with another developer on B4. In all cases, that meant a cash infusion.)
“Is this is this an offer that ESD would entertain at this point with the future of the railyard being in doubt?” he asked.
(If they sold it as is, it would be without the ability to move the bulk from the B1 tower. The new developer would then have to get permission. So I think it’s unlikely, since that bulk transfer, involving perhaps a year-long process, would remain the responsibility of the master developer, which also would like the redistribute the bulk not moved to Site 5 to another parcel, on the railyard.)
Kolkmann said the first thing that came to mind would be the previously mentioned community engagement exercise, but they would have to discuss it internally.
“I think there would be a lot of cognitive dissonance if Greenland still got to take money out of the project at this point, by breaking up the development lease on Site 5,” Veconi said. “I think people would go ballistic.”
Updated: Yes, some members of the public and public officials would go ballistic. It's a good bet that BrooklynSpeaks, the coalition he helps steer and which has the ears of local elected officials, would be out front, as it was, for example, with the Urban Room deadline.
A new AY CDC subcommittee
Veconi noted that theAY CDC charter requires the body to make recommendations to ESD on ways to improve and expedite developer responsiveness to public obligations and increased transparency, as well as to develop recommendations related to the project, including in relation to unanticipated issues.
“This, I think, might be fair to say is an unanticipated issue,” he said, suggesting they form a committee of the board to discuss recommendations.
“Most of you here at ESD," he observed, "are sitting at the table are relatively new to the project… the history is not one that lends itself to an abundance of faith and just letting things play out in their course…This is nowhere near where we thought we'd be 20 years out from the project announcement.”
Chair Daniel Kummer—who was formally appointed after previously serving as Acting Chair—supported the concept but said they needed advice on what constituted an informal meeting, so they wouldn’t violate open meeting laws. “We'll figure that out in the next couple of weeks.”
(If they sold it as is, it would be without the ability to move the bulk from the B1 tower. The new developer would then have to get permission. So I think it’s unlikely, since that bulk transfer, involving perhaps a year-long process, would remain the responsibility of the master developer, which also would like the redistribute the bulk not moved to Site 5 to another parcel, on the railyard.)
Kolkmann said the first thing that came to mind would be the previously mentioned community engagement exercise, but they would have to discuss it internally.
“I think there would be a lot of cognitive dissonance if Greenland still got to take money out of the project at this point, by breaking up the development lease on Site 5,” Veconi said. “I think people would go ballistic.”
Updated: Yes, some members of the public and public officials would go ballistic. It's a good bet that BrooklynSpeaks, the coalition he helps steer and which has the ears of local elected officials, would be out front, as it was, for example, with the Urban Room deadline.
A new AY CDC subcommittee
Veconi noted that theAY CDC charter requires the body to make recommendations to ESD on ways to improve and expedite developer responsiveness to public obligations and increased transparency, as well as to develop recommendations related to the project, including in relation to unanticipated issues.
“This, I think, might be fair to say is an unanticipated issue,” he said, suggesting they form a committee of the board to discuss recommendations.
“Most of you here at ESD," he observed, "are sitting at the table are relatively new to the project… the history is not one that lends itself to an abundance of faith and just letting things play out in their course…This is nowhere near where we thought we'd be 20 years out from the project announcement.”
Chair Daniel Kummer—who was formally appointed after previously serving as Acting Chair—supported the concept but said they needed advice on what constituted an informal meeting, so they wouldn’t violate open meeting laws. “We'll figure that out in the next couple of weeks.”
(It’s unclear how many members of the AY CDC were present; only four spoke, but they needed six of 11 members for a quorum.)
“The reality is that what we want is not what the developer finally comes up with,” Shiffman said, saying their focus should be on ensuring affordable units.
“The reality is that what we want is not what the developer finally comes up with,” Shiffman said, saying their focus should be on ensuring affordable units.
He’d like to change that term to specify percentages of low-, moderate- and middle-income housing, as in the non-binding 2005 Affordable Housing Memorandum of Understanding that original developer Forest City Ratner signed with advocacy group ACORN.
City and state documents later redefined "affordable housing" as any housing with rent and income restrictions under a city, state, or federal program.
Moving the meetings
Kummer brought up a previous discussion about moving the AY CDC meetings back to Brooklyn, closer to the interested public.
Veconi said he did reach out to the Brooklyn Public Library, but they don’t have the necessary video conferencing facilities.
It was unclear why Long Island University, former site of such meetings, no longer qualified, but there was talk about whether any other Brooklyn institutions might make it work.
New staff
ESD’s Kolkmann introduced three “new faces at the table,” including Anna Pycior, Senior Vice President of Community Relations, succeeding the long-running Marion Phillips III. Also he cited David Viana, Assistant Vice-President of Community Relations and Subsidiary Management, and Joy Huang, Director of Real Estate.
Curiously enough, he did not introduce the ESD legal staffer, Richard Dorado, who made a significant number of responses to Directors’ comments.
Moving the meetings
Kummer brought up a previous discussion about moving the AY CDC meetings back to Brooklyn, closer to the interested public.
Veconi said he did reach out to the Brooklyn Public Library, but they don’t have the necessary video conferencing facilities.
It was unclear why Long Island University, former site of such meetings, no longer qualified, but there was talk about whether any other Brooklyn institutions might make it work.
New staff
ESD’s Kolkmann introduced three “new faces at the table,” including Anna Pycior, Senior Vice President of Community Relations, succeeding the long-running Marion Phillips III. Also he cited David Viana, Assistant Vice-President of Community Relations and Subsidiary Management, and Joy Huang, Director of Real Estate.
Curiously enough, he did not introduce the ESD legal staffer, Richard Dorado, who made a significant number of responses to Directors’ comments.
Project progress
Pycior said that 3,212 apartments, including 1,374 affordable ones, had been constructed, and the B12/B13 complex, which is marketed as 595 Dean, has been completed, as have three acres of open space.
Developer TF Cornerstone is still leasing both market rate and the affordable units. For the latter, “they are working through the HPD lottery selections.”
It’s unclear what percentage of the 240 below-market units, at 130% of Area Median Income (AMI), have been occupied.
Nor is it clear what percentage of the 558 market-rate units are occupied; TF Cornerstone is offering an incentive of two months free on a 14-month lease.
She did not mention progress at the school being built in the base of B15 (662 Pacific St., aka Plank Road), which is now expected to open in September 2024 (after being delayed until September 2025) and house a high school, a middle school, and a special needs program. (I'll have an update on that soon.)
She did not mention progress at the school being built in the base of B15 (662 Pacific St., aka Plank Road), which is now expected to open in September 2024 (after being delayed until September 2025) and house a high school, a middle school, and a special needs program. (I'll have an update on that soon.)
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