Atlantic Yards/Pacific Park Report

Led by Council Member Crystal Hudson, ten local elected officials yesterday wrote to Gov. Kathy Hochul and Hope Knight, CEO of Empire State Development (ESD), urging them to start collecting $1.752 million in liquidated damages for the 876 Atlantic Yards/Pacific Park affordable housing units that were supposed to be built by May 31 The letter (bottom), was signed by Hudson and her colleague Shahana Hanif; Assemblymembers Jo Anne Simon, Robert Carroll, and Phara Souffrant Forrest; Borough President Antonio Reynoso; State Senator Jabari Brisport; and Congressional Representatives Dan Goldman, Yvette Clarke, and Nydia Velazquez.  The latter three officials have been far quieter about Atlantic Yards, for example not appearing at a press conference called by--or in a press release from--the coalition BrooklynSpeaks . Hudson posted the letter on BlueSky yesterday, prompting a report earlier today from Gothamist, which quoted ESD as reiterating that it would stop suspending the damages...

I wrote yesterday ( link ) about the nearly $1.85 million in federal political political contributions made since 2021 by the CEO, Nicholas Mastroianni II, and the President, Nicholas Mastroianni III, of the U.S. Immigration Fund (USIF), the "regional center"--investor visa middleman--that's key to Atlantic Yards. The USIF manages the two loans--originally $349 million, with $286 million remaining--that developer Greenland failed to pay off, and thus controls the process of getting a new joint venture partner to develop six sites (B5-B10) over the Vanderbilt Yard. They're not  the "lender,"  despite convenient shorthand used by state officials. But as manager, they control the loan, and thus the collateral--those six development sites--and are trying to recruit a "permitted developer," with experience in large-scale projects, for a joint venture.  Related Companies, which built Hudson Yards, was said to be part of a joint venture, but then left. As...

Nudge forward Atlantic Yards: Brooklyn housing plan must be completed , the New York Daily News editorial board wrote yesterday, offering vague support for an implied compromise, including, perhaps, a waiver of the $2,000/month fines for each of the 876 affordable housing units not completed by May 2025. In other words, the editorial--which generally praises the project while describing it misleadingly--is a not-so-incisive look at a process that's so far been a black box. Then again, at least someone's trying to discuss a complicated issue that's mostly been buried. (Here's my recent Atlantic Yards overview , for Urban Omnibus.) Should state pay? In response to the editorial, as noted below, an influential advocate, Gib Veconi, suggested that the state should pay for the platform and, implicitly, waive pending fines.  My take is such a public contribution--the platform, as of 2019, was estimated to cost $240+ million and probably now more than $300 million--must invol...

Governor Hochul Announces Next Phase in Long-Term Housing Strategy Will Focus on Increasing Housing Supply in New York City , Gov. Kathy Hochul announced Jan. 9, as part of her State of the State address. The notable section for Atlantic Yards/Pacific Park watchers is this: Incentivizing Construction of New Housing, Including Affordable Housing The expiration of the 421-a tax abatement program in 2022 put the construction of an estimated 30,000 units of housing in New York City at risk. To avoid losing thousands of units of housing already under construction, Governor Hochul launched a pilot program in July 2023 to replicate the 421-a program’s benefits and obligations for projects located within the Gowanus rezoning area in Brooklyn that were already vested in the tax abatement program when it expired. As of December 2023, the Governor’s Gowanus program has received 19 applications that could yield up to 5,500 units of housing, including 1,400 units of affordable housing. To help the...

The bombshell announcement of foreclosure auctions for the six Atlantic Yards/Pacific Park development sites over the Vanderbilt Yard, as I wrote yesterday, raises more questions than it answers. And that means that Empire State Development (ESD), the state authority that oversees/shepherds the project, must publicly discuss its role and the guidelines and obligations it requires of whatever company (or companies) might take control from Greenland USA. ESD did not respond to my queries yesterday. It is overdue to schedule a quarterly meeting of the advisory Atlantic Yards Community Development Corporation (AY CDC), which has mostly been toothless but on Aug. 2 asked for a report on the project's financial viability. That would include the developer's obligation to pay $2,000 a month in fines for each affordable housing unit not delivered by a May 2025 deadline. Of the 2,250 required units, 876 (or 877) remain. That report, requested for early October, has not been delivered. ...

The failure of Gov. Kathy Hochul's ambitious housing plan has big-picture implications--today's New York Times front-page article was headlined New York Officials Failed to Address the Housing Crisis. Now What? --but for Atlantic Yards/Pacific Park watchers, one provision is probably the most important. The governor had proposed to extend for four years the deadline to complete projects using the 421-a tax break--which had to start by June 15, 2022 and be finished in 2026--but that, as well as other elements of her proposed Housing Compact--didn't pass. Nor was 421-a renewed. B5, center-left, plus (built) B4. Dattner Architects So June 15, 2026, the deadline for construction under the recently expired 421-a tax break, looks ever more challenging--though theoretically possible--for the first tower slated for the Vanderbilt Yard, B5, or 700 Atlantic Avenue. The site supposedly had sufficient footings to qualify as having started under 421-a's loose requirements. After al...

Things were rosier in March 2022, right?  That's when a group of dignitaries including Huang Ping, the Chinese Consul General in New York, apparently visited 18 Sixth Avenue (B4, aka Brooklyn Crossing), co-developed by Greenland USA--a subsidiary of the Shanghai-based Greenland Holdings Corp.--with The Brodsky Organization. The latter seems  solely responsible  for marketing the rentals.  "Encompassing 15 buildings that will be surrounded by an iconic 8-acre park, Pacific Park is a new community and offer a wide range of housing choices with 2250 affordable homes in the heart of Brooklyn," wrote the Consul General on Twitter, seemingly channeling a public relations statement. "Thanks to Greenland USA, they have been building such a fabulous project!" The attached images included a rendering of the 858-unit B4, which contains 30% middle-income "affordable units," plus a photo. Encompassing 15 buildings that will be surrounded by an iconic 8-acre park, ...

In her proposed FY 2024 Executive Budget, Gov. Kathy Hochul, among her housing proposals , has offered real estate developers a significant benefit, with an extension of the construction deadline for projects fueled by the 421-a tax break for more than 4.5 years:  In order to unlock thousands of units of housing currently under construction, the Executive Budget extends the 421-A construction deadline through 2030. The Budget also expands HCR’s Tenant Protection Unit as part of a multi-year investment to provide targeted support for tenants in upstate New York. Of course "currently under construction" is a bit of a dodge, since many developers simply did preliminary work on foundations by June 15, 2022 to qualify for the tax break--and may not have proceeded since then. There are many reasons for delay, but one, as the Real Deal has reported , is that the June 15, 2026 deadline for construction was getting tenuous, since lenders wanted the buildings completed a year early. If...

Hochul (c) with TV personality Robin Roberts (l) and Clara Wu Tsai (r). Photo : Kevin P. Coughlin/ Governor's Office, 8/2/22 Little more than a month before Gov. Kathy Hochul attended a WNBA New York Liberty game last summer, posed for a photo with Liberty co-owner Clara Wu Tsai, and also honored recipients of the team owners' Social Justice Fund, Clara Wu Tsai gave Hochul's election fund the maximum contribution, $69,700. Tsai, by my calculation, was among the 42 individuals (plus five political action committees) that contributed the maximum. Other contributors included Madison Square Garden owner James Dolan, local developers Steve Roth and Steve Ross, and tech leaders Eric Schmidt and Reid Hoffman. Contributors often have some business--or expect to do some business--before state agencies. It was a part of a massive haul, $46 million in Hochul's first 14 months in office, as Gotham Gazette  reported  10/12/22, noting that future campaigns will be limited--and made m...

According to the NYC Department of City Planning's recent information brief, New Housing Permits in the First Half of 2022 (also at bottom), the first half of 2022 saw a significant spike in building permits, as the Department of Buildings (DOB) issued permits for about 58,600 homes. That's more than double any previous full year since 2015 (60,500 permits), which, not coincidentally, also was the last period before the expiration of the 421-a state tax break, later renewed and revised as Affordable New York. This year, the tax break expired June 15, 2022. DCP noted that the spurt likely related to developer uncertainty about whether the state legislature and governor will agree--as they were not able to do--on a renewal. In the interim, it's likely that far fewer permits will be filed--and that they'll not be for rentals, like the most recent Atlantic Yards/Pacific Park buildings, with 30% middle-income affordable housing. What's next As Greg David of The City, wh...

The context for the reflexive support for Atlantic Yards/Pacific Park from Empire State Development, the state authority that oversees/shepherds the project, is that it's controlled by the governor.  And every governor so far--George Pataki, Eliot Spitzer, David Paterson, Andrew Cuomo, Kathy Hochul--has so far been clearly, or at least implicitly, willing to heed the desires of the project developer. That's part of the culture of Albany. And Hochul, though she has (as far as I can tell) loosed control over Freedom of Information Law requests, has not changed the culture enough. Hochul’s Vow to Fix Albany’s Culture Finds an Unexpected Foe: Herself , the New York Times reported 7/11/22, citing Hochul's push for a last-minute $10 billion in tax breaks for semiconductor makers, her willingness to subsidize a new stadium for her hometown Buffalo Bills, and her willingness to exempt "a huge swath of money from independent oversight by the state comptroller’s office and from ...

The June 15 deadline to get residential buildings to qualify for the 421-a tax break has passed, and many now have the beginnings of foundations--and a three-year deadline, by 6/15/26, to complete construction. And that means, likely, a temporary stall on new construction, at least that which is not fully market-rate or significantly subsidized by the city. Dead and buried: 421a is gone. Will it ever return? , the Real Deal reported 6/15/22, noting that Gov. Kathy Hochul's proposed replacement program, 485-w , failed in the Legislature. That proposal, I'd note, would've required deeper affordability than the previous iteration (aka "Affordable New York"), passed in 2017, which allowed for 30% of units for households at 130% of Area Median Income (AMI)--people essentially earning six figures  and potentially paying more than $3,000 per unit. What next? The Real Deal noted, "In a joint statement, the Real Estate Board of New York, 32BJ SEIU and the New York Bui...

In contrast (mostly) with the Citizens Budget Commission, as I wrote yesterday , on 3/16/22 NYC Comptroller Brad Lander, Council Members Tiffany Cabán and Pierina Sanchez Called to Nix 421-a Developer Tax Break , urging the state legislature and the Governor to allow the program to expire, given annual foregone property taxes of $1.77 billion in FY 2022. Lander also released A Better Way Than 421-a: The High-Rising Costs of New York City’s Most Unaffordable Tax Exemption , an analysis of the cost of the program and its proposed changes, the impact on housing production, and the nexus between 421-a and structural property tax reform. (Here's the  report  and the livestreamed press conference , held outside The Willoughby  in Fort Greene/Downtown Brooklyn, which has the most expensive "affordable housing" I've noticed under 421-a.) “The 421-a program is a towering boondoggle – costing our city $1.77 billion this year in foregone taxes and delivering only a small handf...