Atlantic Yards/Pacific Park Report

Photos Aug. 5, 2022 There's a lot of work going on at the arena plaza, replacing the tiles, which were ten years old, somewhat the worse for wear, and outdated. Note: the photo at right was taken through a hole in the green-draped fence that prevents access to much of the plaza, as work is going on. Remember the tiles honoring the original sponsor, the New York Daily News?  Since then, the plaza's been sponsored by Resorts World NYC Casino and now the ticketing company SeatGeek, as the arena operating company, owned by billionaire Joe Tsai, seeks additional revenues. Lesson learned. As shown in the close-up below, there don't look to be any branded/logo'd tiles any more. The work is expected to be finished by October, but it's likely the lion's share will be done by the ten-year anniversary of the arena opening, which will be Sept. 28. Another project, perhaps As I walked around the arena perimeter, I couldn't help but notice that there's another major j...

When I did a walk Aug. 5 around the arena block, I took two photos of Block 1129, the southeast block of the project, where B12 & B13 (615 Dean St. & 595 Dean St.) have topped out and are nearly fully enclosed, headed for a mid-2023 opening.  The block is bounded by Dean and Pacific streets, and Sixth and Carlton Avenues. But it all depends on perspective. The first photo below, taken from Carlton Avenue south of Atlantic Avenue, shows the four towers--including the already completed B11 (550 Vanderbilt Ave., far left) and B14 (535 Carlton Ave., far right)--without much perspective on what's left to do. Photos: Aug. 5, 2022 The second photo, looking east over the MTA's Vanderbilt Yard, shows the towers only fractionally. The railyard block is bounded by Atlantic Avenue and Pacific Streets, and Sixth and Carlton Avenues. A large and expensive platform must be built to support three towers (B8/B9/B10), and that's the second phase of a two-phase project that hasn't...

We Need to Keep Building Houses, Even if No One Wants to Buy , a New York Times news analysis told us 7/23/22: The United States has a deep, decades-old housing shortage. Also, at the moment, homebuilders across the country are pulling back on development because they can’t sell enough homes. How can both of these things be true? That riddle is at the heart of the boom-bust nature of housing, where an excess of regulation and the mixed incentives of the market mean there is never a supply that lines up with demand. One way or the other, solving it will require more building during downturns, and, most likely, some sort of public program to subsidize it. The article does not assess New York City, which may be something of a special case, though certainly part of the problem cited--NIMBYism--applies to the suburban communities that have failed to accept there share of growth, even near public transit stations.  (And who exactly is "we"? I'll mention the social housing alter...

It's been two straight setbacks for Greenland Holding Group (aka Greenland Holdings Group) in Forbes magazine's Global 2000 listing. After rising to 307 two years ago, last year it  dropped  to 372 and this year continued sliding, to  415 . That contrasts with Greenland's steady rise on the Fortune Global 500 ranking,  noted yesterday , to 125.  The two rankings are not the same. Forbes  bases  its assessment on four broad metrics: a composite score assessing sales (revenue), profits, assets, and market value.  The better-known Fortune ranking relies solely on revenue in the past fiscal year. Neither takes notice of Greenland's significant debts, which have caused its credit rating to plunge to Selective Default, as per S&P, before  recovering slightly . Drilling down As shown in the screenshot below, Forbes ranks Greenland far higher than its overall metric in sales and assets, but well behind in profits and market value. Its market...

Fortune magazine on 8/3/22 released its annual Global 500 list, with Greenland Holding Group, parent of the main Atlantic Yards/Pacific Park developer Greenland USA,  rising to #125 from #142. That mostly steady ascent that nonetheless lags behind previously  stated  (in 2014) ambition to reach the top 100 by 2020. The well-known Fortune Global 500 ranking relies solely on revenue in the past fiscal year. The lesser-known Forbes Global 2000  bases  its assessment on four broad metrics: a composite score assessing sales (revenue), profits, assets, and market value. (I'll have more on that tomorrow.) Neither takes notice of Greenland's significant debts, which have caused its credit rating to plunge to Selective Default, as per S&P, before  recovering slightly . And its stock price is down . Looking at the numbers Screenshots from Fortune The company information shown at right obscures some significant differences between the report a year earlier....

Well, Greenland Forest City Partners (GFCP) still doesn't sound completely confident that work on the first phase of the platform, crucial to the construction of three towers, will start in the second half of this year. That's according to the latest six-month look-ahead (bottom), covering the second half of 2022, that the master developer is supposed to file with Empire State Development (ESD), which oversees/shepherds the project. Also, GFCP does not say that any specific work on the B5 tower--700 Atlantic Avenue, also bordered by Sixth Avenue and Pacific Street--would start in this half of the year, according to the document. That said, the developer has said B5 wouldn't rise until next year, and it's not unlikely some of the work announced contributes to that parcel, even if the tower isn't mentioned. That document, dated 6/9/22,  again says--as it did in three previous iterations --that "Platform construction may commence during the reporting period."...

The Barclays Center operating company made an $18 million profit, of sorts, in the first six months of calendar year 2022, according to financial documents recently disclosed to bondholders. See screenshot at right. But that result, coupled with a stagnant first half of the 2022 fiscal year, won't be enough to cover the arena's construction debt in FY 2022, which ended June 30. So that means that owner Joe Tsai will have to dip into his pocketbook to cover the payments, as he has pledged . Limited schedule So even a busy season for the Brooklyn Nets, with high ticket prices, didn't make up for a slow schedule for other events, including concerts. As I wrote in February, the arena company barely broke even in the first half of the fiscal year--see screenshot at left--but needs some $37.8 million for required PILOTs, or payments in lieu of taxes , of which $26.2 million goes toward debt service on arena construction bonds. Most of the rest goes back to the arena company to b...

Aug. 5, 2022 The escalators at the arena plaza have been out since at least July 22, as I wrote , but I couldn't get any explanation from the arena operator as to how long or why. Was it associated with plaza repair work? That seems unlikely. Rather, it's just another example of faulty equipment and/or maintenance. On Friday, Aug. 5, when I walked by, the escalators were under repair. In fact, the down escalator was running, albeit without any access, apparently as part of a test run. The up escalator was getting worked on. So maybe they'll both be running soon, (Or who knows, maybe they fixed the problems by the end of the day.) But this shouldn't be the realm of speculation. A responsible operator--the arena company operates the escalator, as it controls the plaza--should make it easier to find out when the escalators (and elevator) are out of operation, when work is scheduled, and when the problem is expected to be fixed--and fixed. It shouldn't be that complicat...

The latest Atlantic Yards/Pacific Park Construction Update (bottom), covering the two weeks beginning Monday, Aug. 8, was circulated 8/5/22 at 10:51 pm (lead time) by Empire State Development (ESD) after preparation by Greenland Forest City Partners (GFCP), which is dominated by Greenland USA. There's not much new compared to the  previous update , and the document again excludes the most dramatic change around the project footprint--the work at the arena plaza for revamping of the pavement and other features.  The one notable change regards work on the southeast block, at the B12/B13 (615 Dean St./595 Dean St.) sites: The removal of the West Courtyard Sidewalk Shed (the north half of the sidewalk shed located between the West tower of 595 Dean St. and 535 Carlton Ave. may be scheduled for the week of 8/15/22. Courtyard fencing between East tower [615 Dean St.] and 550 Vanderbilt Ave. as well as the West tower and 535 Carlton Ave. may be installed so that the build out of the ...

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...

Remember the advice , nearly three years ago, from Wall Street Journal columnist Mike Bird to sell Greenland Holdings Group (aka Greenland Holding Group), the parent of the main Atlantic Yards/Pacific Park developer, Greenland USA? He was right, as the company's stock price has dropped by more than half, as explained below. Bird's 8/28/19 column observed that that, despite growing property prices in China, and Shanghai-based Greenland celebrating a Forbes rank for fastest revenue growth, there were reasons to worry. (Note: Bird's original tweet, cited in my post, was later deleted.) While Greenland had cut debt in half, from a stratospheric figure, it had doubled "unearned revenues," which refers to properties bought by customers but not yet delivered. That left Greenland with a dangerously high figure of debt to assets of 89%, a bit higher than even some other large developers. Indeed, with the pandemic and national policies upending previous patterns, Greenland...

There's a huge new tower in Long Island City called Sven , 71 stories, with 958 units, 288 of them "affordable" for middle-income households earning 130% of Area Median Income, or AMI, the minimum required to get the lucrative 421-a tax break. Developed by  Durst Organization  and designed by  Handel Architects , the building offers amenities like a gym, yoga/dance studio, pool, and media room. Units  boast  floor-to-ceiling windows, Blomberg washer & dryer, polished quartz kitchen, and Grohe bath fixtures. At the developer's website  LIC Rent Regulated --they're not stressing "affordable"--they encouraged people to apply to the housing lottery, "[i]f your combined household income is between $68,229 and $192,400." (The lottery ended on 3/21/22.) Another way of putting it: studios start at $1,990 and one-bedrooms at $2,132, as shown in the screenshot below. A closer look But wait. Take a look more closely at Housing Connect , and see that ...

The Barclays Center yesterday released its August 2022 event calendar.  There are six ticketed events, including three WNBA New York Liberty games, and three concerts, including two by Kendrick Lamar. There were supposed to be two Shawn Mendes concerts , but he postponed and then canceled his tour, taking a mental health break . The calendar also includes two free showings of student art next Monday and Tuesday, part of The Basquiat Project, and a private event Sunday associated with the project, as described further below. The Basquiat project The arena, as it did in a year ago, will host  an art show featuring approximately 100 pieces created by New York City middle and high school students, inspired by Brooklyn-born artist Jean-Michel Basquiat.  It's part of an educational arts program the Brooklyn Nets developed in partnership with the New York City Department of Education (NYC DOE) and the Fund for Public Schools, and funded by the Joe and Clara Tsai Foundation, the ...

It seems like the law firm Fried Frank--which represented developer Forest City Ratner on all aspects of Atlantic Yards, including bond financing, the override of zoning, and litigation--is the destination of choice for lawyers making the jump from New York City's Department of City Planning. Along with  Melanie Meyer s, who joined the firm in 2003 after serving as DCP's general counsel, and  David Karnovsky , who joined in 2014 after serving in the same post, former general counsel and then acting director Anita Laremont has signed on, according to The Real Deal, and will start in September. Note: Meyers, Karnovsky, and Jonathan Mechanic were  ranked  #67 in City & State's 2022 Real Estate Power 100, given the firm's role in numerous big projects. Past service Laremont previously spent 16 years as general counsel at Empire State Development Corporation (now simply Empire State Development, or ESD), famously defending Atlantic Yards to the hilt. Remember, ...

It helps to know the right people, doesn't it? From  NYC Mayor Eric Adams’ Son on Rapping, Drill Music, More: ‘You Can’t Ban a Genre of Music’ , a 7/28/22 interview in Complex, which covers a lot of interesting topics. Jordan Coleman, in addition to rapping, told interviewer Andre Gee he works as "a creative coordinator for the film department at Roc Nation... reading over scripts...  brainstorming creative ideas." How did he get the job? There was something on Indeed talking about Roc Nation films and I applied for it. I was waiting to hear back for some time. And then obviously my dad being the mayor of New York City, he meets a lot of interesting people. He was saying that he had dinner with Brett Yormark of Roc Nation. He was the COO at the time, and I asked if I could join him along for dinner. The funny thing with that story is: We get to dinner and I’ve got my laptop, my notepad, and my hat, ready to go, like, “Sir, it’s an honor...” And he’s just looking at me lik...

China’s debt cataclysm threatens US real estate projects , the Real Deal published yesterday, citing several firms, including Greenland USA, master developer of the Atlantic Yards/Pacific Park complex in Brooklyn and owner of the Metropolis complex in Los Angeles. The parent companies are struggling in China, defaulted on or postponed debt,  and have seen their credit ratings plummet--Greenland Holding Group has flirted with default--which constrains their ability to invest in their overseas projects. So such "desperate" (according to the publication) firms have cut prices and sold assets. As cited in this article and previously noted , Greenland USA has put a hotel in Los Angeles up for sale; it had previously been marketed for $280 million. And in Brooklyn Unmentioned by the Real Deal, but clear to Atlantic Yards/Pacific Park watchers, Greenland USA has raised money by selling assets: development leases to the B12/B13 sites (615 Dean St./595 Dean St.) to TF Cornerstone and ...

Sixth Ave. entrance, July 26, 2022 So, when is the middle-school at the base of the B15 tower (662 Pacific St., aka Plank Road) coming?  When I walked by three nights ago, it didn't look like anything was happening, as shown in the photo at right, though construction was supposed to start this month. Remember, everything has taken longer than expected, with the start and completion date pushed back steadily. As I wrote 6/15/22, according to the latest update , from February 2022, to the School Construction Authority/Department of Education Five-Year Capital Plan, the school, known as I.S. 653, is due in March 2025. The school's address likely will be 491 Dean St. See screenshot below, which also indicates that construction was supposed to start July 2022. (Here's the  overall page  for updates.) A March 2025 completion implies a September 2025 opening, with ample flex in the schedule. Still, there's a lot to be done, as shown by the raw basement in the photo below. Note...