Atlantic Yards/Pacific Park Report

This is the second of three articles on Greenland USA finances related to Atlantic Yards/Pacific Park. The first concerned Greenland's large impairment (loss in value).  The  third  concerned Forest City's giving up its shares in the B4 tower and future Site 5 project. A Forest City Realty Trust press release June 28, 2018, Forest City, Greenland Close Restructuring of Pacific Park Brooklyn Partnership , indicated, that, as previously announced, Greenland USA would acquire all but 5% of Forest City Ratner/Forest City Realty Trust's ownership interest in Pacific Park going forward. No price was announced. While some, including me, unwisely used the term "buy," the press release didn't specify a sale, or a price. As I describe below, evidence--neither confirmed nor denied--suggests that Forest City simply gave it away, to avoid further losses. That press release carefully cited a "restructuring" that took "Greenland USA's ownership interest i...

It's no surprise. The six-month look-ahead required of the Atlantic Yards/Pacific Park developer again indicated that no construction is planned for the second half of 2024. After all, the project's stalled, and the six development sites over the MTA's Vanderbilt Yard face a foreclosure auction, which has been postponed four times, likely awaiting a larger renegotiation of project terms. According to the document (below), Greenland USA's Jen Kuang told Empire State Development (ESD), the state authority that oversees Atlantic Yards/Pacific Park, that no construction activities are scheduled for Block 1120, which was supposed to be the first block of a two-block platform. Each block would support three towers. (I acquired the letter thanks to a Freedom of Information Law request.) Past pattern As I wrote last December, Greenland was once more optimistic. In the May 6, 2020  memo covering the second half of 2020, the developer pronounced, unwisely in retrospect, that ...

At the Aug. 2 meeting of the Atlantic Yards Community Development Corporation (AY CDC), as I reported for City Limits, the directors voted unanimously to ask parent Empire State Development (ESD), to prepare a financial analysis of the future of the Atlantic Yards/Pacific Park project, of which seven development sites--six over a railyard, requiring an expensive deck--remain. They asked for it to be delivered in 60 days, by Oct. 3, presumably before the next AY CDC meeting. (The board is supposed to meet quarterly, so three months would be the first week of November, but it hadn't met since April 11, so it was behind schedule.) The report is not finished, perhaps not surprisingly, and no new AY CDC meeting has been scheduled. "Empire State Development is coordinating with the developer on a financial analysis of the remaining Atlantic Yards sites," a spokeswoman for ESD stated in response to my query. "This is not yet complete. ESD will share this analysis with the...

Fortune magazine on 8/2/23  released  its 2023 Global 500 list, with Greenland Holding Group, parent of the main Atlantic Yards/Pacific Park developer Greenland USA,  plummeting to #205 , after  rising  to #125 in 2022 from #142 in 2021. That reverses an ascent that came part of the way to meeting the company's  stated  (in 2014) ambition to reach the top 100 by 2020. Screenshot from Fortune Dropping revenue, plunging profits The well-known Fortune Global 500 ranking relies solely on revenue in the past fiscal year. Greenland had $64 billion in revenue, a 23.3% decline from $84.5 billion in the previous year. Though not part of the ranking, it's worth noting that Greenland's profits plunged 84.3%, to $150 million from $958 million. Some other developers are in the red.  Greenland's employee count dropped 12.3%, from 79,999 to 70,177. In 2021, the number of employee exceeded 86,000.  All this suggests Greenland would be cautious toward making ...

New Data Shows Where Rent-Stabilized Apartments Might Be Disappearing , THE CITY reported 2/15/23, with a map that suggested--hardly conclusively, in my assessment--that one building with rent-stabilized units in the Atlantic Yards/Pacific Park project might be among the "disappearing" group. Rather, it seems more likely sloppy record-keeping by the building owner-operators, compounded by insufficient oversight. From The City: The nonprofit group JustFix shared with THE CITY records of 44,470 buildings that reported rent-stabilized units on their property tax bills in the last few years. The city Department of Finance says it gets that information directly from the state Division of Housing and Community Renewal (HCR), which requires property owners to annually certify the number of rent-regulated apartments in their properties. Screenshot from THE CITY/JustFix Here's the map , excerpted at right, with the "100% affordable" 535 Carlton Avenue highlighted in blu...

Yes, something's brewing regarding the reconfiguration of the Atlantic Yards/Pacific Park plan. We just don't know the details. At the Quality of Life meeting earlier this month, Tobi Jaiyesimi, Atlantic Yards Project Manager for Empire State Development (ESD)--the state authority that oversees/shepherds the project-- said there were "no updates to share at this time" regarding the delayed platform. The first phase had been scheduled to start last spring, and would support three of the six towers over the Vanderbilt Yard. Since last spring, it's gotten teased as imminent in the bi-weekly Construction Updates, subject to receipt of permits. Affordable housing delay That delayed platform means it's impossible for developer Greenland Forest City Partners to deliver the remaining 876 (or 877) affordable housing units by May 2025, out of the required 2,250 units. But the developer, dominated by Greenland USA, surely does not want to pay the $2,000/month fines for...

One lesson from Atlantic Yards/Pacific Park is that complicated contracts can get ignored, whether willfully or carelessly. We learned that during the kerfuffle over the unbuilt (and largely forgotten) Urban Room, which was supposed to be finished by May but almost certainly won't be built, given the complexity, cost, and interference (with arena activities) of building the flagship "Miss Brooklyn" tower.  Instead, the developer wants to move most of that bulk across the Flatbush Avenue, which would require new project approvals. Empire State Development (ESD), the state authority that oversees/shepherds the project, was distinctly uninterested in enforcing those fines, which could total $10 million by May 2023. ESD does have a "right to refrain" from enforcement, so that situation may stand. And that posture puts in focus a more significant enforcement deadline: May 31, 2025, by which the developer is supposed to complete the project's 2,250 affordable hou...

In my post yesterday about Greenland USA's challenges in the face of its parent company's financial strictures, I briefly raised a question: what else does the developer have to sell--future development rights to the railyard? to Site 5?--to fund the project going forward. Responding to my tweet, Gib Veconi, who as a leader of the BrooklynSpeaks coalition and a member of the Atlantic Yards Community Development Corporation is a key voice influencing local elected officials, suggested , "Development rights over railyards likely not marketable now due to looming #affordablehousing deadline and associated remedies." Yes, but... I think he's mostly right, but with some asterisks. As of now, given the May 2025 deadline to deliver 877 (or 876) more units of affordable housing, after which the developer--Greenland Forest City Partners (GFCP), owned 95% by Greenland USA--faces $2,000/month fines for each missing unit, no developer would want to buy development rights fo...

This is the fourth of four articles about the July 12, 2022  Quality of Life meeting . I submitted several questions. Some got answers, as noted below, but the big ones got deflected or ignored by developer Greenland Forest City Partners (GFCP) or Empire State Development (ESD), the state authority that oversee/shepherds the project. Affordable housing obligation Does GFCP have a plan to  meet the May 2025 deadline  for affordable housing? Scott Solish of Greenland USA, which owns nearly all of GFCP, said it was the "same answer that we always have. We're moving ahead with our plans with the platform.... We are working on hitting all of our targets, as we always have." Except they haven't hit their targets--for example, they announced in 2019 that the platform would start in 2020.  If that deadline is not met, will ESD enforce the $2,000/month fines for each missing affordable unit? ESD's Tobi Jaiyesimi ignored that question. Project completion If GFCP aims to com...

Where's the latest Construction Update, aka two-week look-ahead, for the two weeks beginning yesterday, Monday, July 11?  It's supposed to be prepared by master developer Greenland Forest City Partners (GFCP) and then circulated by Empire State Development (ESD), the state authority that oversee/shepherds the project. The bi-weekly document is typically circulated before the weeks it accounts for, though is sometimes--as it was two weeks ago --shared on the first working day. In July 2021, they simply missed two weeks--a "severe oversight," acknowledged an ESD official--and didn't even post it after the fact. Could it be that, say, a single person going on vacation can muck it all up? The circulation of these updates is important not just to alert neighbors of work near them, including after-hours work. In this week's case, it's important to have a clear picture of what's actually going on--has work on the platform actually started?--before this eveni...

Three weeks ago, I wrote that Greenland Holdings Corp. (aka Greenland Holding), the Shanghai-based conglomerate that owns Greenland USA, had seen its stock price halved in two years and its credit rating plummet. (Greenland USA owns nearly all of Greenland Forest City Partners, which owns/has funding responsibility for Atlantic Yards/Pacific Park going forward, though the joint venture has sold off properties.) So that led to two, multi-notch downgrades in a week from the two main credit rating agencies, Moody's and Standard & Poor's, with S&P--though not Moody's--placing Greenland on the edge of default. New downgrade Now S&P, in a 6/21/22 announcement, Greenland Holding Downgraded to 'SD' On Completion of Distressed Maturity Extension , said it viewed the company's one-year extension of payment for nearly $500 million in notes (originally due June 25) "as a distressed debt restructuring tantamount to a default." That, however, is not qui...

This is the fourth of ten articles on the 6/7/22 meeting of the Atlantic Yards Community Development Corporation. The  first  concerned the affordable housing timetable. The  second  assessed an estimated 2031 completion date. The  third  addressed the impact of a potential Greenland default. The  fifth  concerned the deadline for the Urban Room. The  sixth  addressed timing for the school.  The  seventh  concerned plans for the platform. The  eighth  discussed community impacts of construction.  The  ninth  concerned plans for B12/B12 affordable housing.  The  tenth  concerned the Open Meetings Law. During his slide presentation , Scott Solish of Greenland USA pointed to the location for the first phase (of two) of platform development: Block 1120 of the Vanderbilt Yard--from Sixth to Carlton avenues and Pacific Street to Atlantic Avenue. That will support three towers, the first of...

This is the third of ten articles on the 6/7/22 meeting of the Atlantic Yards Community Development Corporation. The  first  concerned the affordable housing timetable. The  second  assessed an estimated 2031 completion date. The  fourth  concerned expectations of 421-a benefits. The  fifth  concerned the deadline for the Urban Room. The  sixth  addressed timing for the school.  The  seventh  concerned plans for the platform. The  eighth  discussed community impacts of construction.  The  ninth  concerned plans for B12/B12 affordable housing.  The  tenth  concerned the Open Meetings Law. While the Shanghai-based parent company of Greenland USA--which owns nearly all of master developer Greenland Forest City Partners (GFCP)--is struggling financially and seen its credit rating plummet, representatives of both the U.S. subsidiary and of Empire State Development (ESD), the state author...