Weekly Digest: Related Deal Still Murky; Momentum for Site 5 & Permanent Plaza
Weekly Digest: Related Deal Still Murky; Momentum for Site 5 & Permanent Plaza
New York State officials, at public meeting, sound cagey. What about the middleman with a criminal record?
This digest offers a way for people to keep up with my Atlantic Yards/Pacific Park Report blog, as well as my other coverage in this newsletter and elsewhere.
Virtually no other news outlet—other than the real estate-focused The Real Deal, sometimes—covers meetings of the advisory Atlantic Yards Community Development Corporation (AY CDC), where insights on the project typically surface.
So instead of producing one long article, like I might have done years ago, I can space out my coverage, as I did this week. The upshot: there are more questions than answers about some big Atlantic Yards issues, but New York State officials seem unwilling to push the developer(s).
Enter Related
With Related Companies expected to be part of a joint venture (JV) to develop six tower parcels (B5-B10) over the Metropolitan Transportation Authority’s Vanderbilt Yard, will that JV be responsible for the May 2025 deadline to build 876 more units of affordable housing, or pay $2,000/month fines?
AY CDC Director Gib Veconi, who as a leader of the BrooklynSpeaks coalition helped negotiate the 2014 settlement that established the new 2025 deadline and the penalties, made a reasonable case that the JV should be responsible.
But representatives of Empire State Development (ESD), the state authority that oversees/shepherds the project, did not look encouraging. That, I suspect, is because they've already discussed, at least with current developer Greenland USA, a project reconfiguration that would extend the deadline and thus not enforce the penalties.
That reconfiguration, as shown below in an unofficial image, would expand the project significantly, making the parcels more valuable and, presumably, counterbalancing (and more) the cost of the platform over the railyard for vertical construction.
A shady middleman
What about another member of the joint venture, the U.S. Immigration Fund (USIF), a visa broker/middleman that raised $349 million from suckers Chinese investors seeking green cards under the EB-5 program?
The USIF, though it didn’t put up the money, as manager controls the $286 million in foreclosed debt, with the six railyard tower sites as collateral.
The USIF is led by Nicholas Mastroianni II, who has a record of being arrested on felony drug charges and pleading no contest. Was it a felony plea? If so, he’d qualify as a Prohibited Person, and thus should be barred from doing business with ESD. (Oops—they already did business with him on the two EB-5 deals.)
“We are aware of news reports on USIF, but we still we don't have enough information yet to make a decision," an ESD attorney said.
What about Site 5?
How exactly did Greenland, the current master developer for Atlantic Yards/Pacific Park, gain New York State encouragement to build a massive two-tower project at Site 5, the parcel catercorner to the arena block? See the unofficial image below.
As I wrote, the approval path for what might be the bulkiest--and second-tallest--building in Brooklyn sounded rather bureaucratic. Site 5 is bounded by Atlantic, Flatbush, and Fourth avenues, and Pacific Street, and currently home to the big-box store P.C. Richard and the now-closed Modell’s.
What’s confounding is that ESD officials, presenting the plan the state authority in 2021 agreed to support (without telling the public), fudged things in the slide below.
For example, the slide omits height, while the official document, Exhibit K, states that the taller tower could be 910' and the shorter tower 450'.
While the slide states "allow hotel use," it doesn't mention that the hotel could be huge, up to 550 rooms.
While the slide states "Allow dynamic LED signage and below-grade retail” and notes that the retail--substituting at least in part for 240 parking spaces--would not count as gross square feet, it doesn't fully explain the requested bonus.
Preserving the plaza
By eliminating the Urban Room atrium and the B1 flagship tower, the state would thus "preserve" the plaza, today sponsored by Ticketmaster.
That use of "preserve" suggests that ESD would be conserving something civically valuable rather than also making "permanent"--the official language-- a space that's key to arena operations and revenues.
As I wrote, the plaza’s enormously valuable to the arena operator, owned by Joe Tsai (and the Koch family), likely more than the planned, but unbuilt, Urban Room atrium. But the operator pays the state only $10 to lease the arena site, including the plaza, with payments in lieu of taxes to pay off construction debt.
Let’s see if that gets discussed at the next AY CDC meeting, likely in November.
Atlantic Yards tour Oct. 20
I’ll be leading a ticketed, hour-long tour, Atlantic Yards: A Megaproject Unresolved, on Sunday, Oct. 20, at 3:30 pm and again at 5 pm, as part of Open House New York Weekend, a five-borough festival over three days celebrating design, culture, and civic investment.
Please note that this can’t be a full tour of the project, which generally takes 1.5-2 hours, but we’ll see what we can.
The tour is part of a series, An Urban Omnibus-Eye View of New York City, curated by the publication Urban Omnibus, which in May published my short history of the project, Watch This Space.
Tickets will be released on Oct. 8 at 11 am. (The $6 fee goes to the festival; I do this as a volunteer.) If you’re a reader and attend the tour, please say hi.
I typically offer a longer free tour the first Friday in May, as part of Jane’s Walk NYC, honoring Jane Jacobs. (I also can lead paid tours for classes and groups.)
From Atlantic Yards/Pacific Park Report
Sept. 30: Busier Barclays Center finally reports a moderate profit, thanks to big boost in event, ticketing, and concession revenues. But what about $51M in capital expenses?
Oct. 1: Barclays Center releases October 2024 event calendar: 15 ticketed events, including 8 concerts.
There will be more New York Liberty games: either a fifth game in the WNBA semi-finals, if the Las Vegas Aces win today’s game (which starts at 3 pm), or two finals home games, if the Liberty win today. If the semi-finals goes five games and the Liberty win, they’ll go to the finals, as well.
Oct. 1: Atlantic Yards meeting: as Related moves toward joint venture, who's obligated to build the affordable housing? What entities would be in project agreements?
Oct. 2: With giant project proposed for Site 5, across from arena, are changes locked in? Seems so, despite denials. Unmentioned: unprecedented density.
Oct. 4: The arena company benefits from the temporary plaza, likely more than with the unbuilt Urban Room. NY State seems ready to make it permanent, with no reciprocity.
Oct. 4: A couple of Atlantic Yards-adjacent bits in the Eric Adams controversies: Winnie Greco and Greenland; AI company and Barclays.
Greco, who was Borough President Adams’ unpaid “ambassador” for Chinese affairs, was clearly questionable a decade ago, when I wrote about her. More journalism, notably from bilingual reporters, would’ve been valuable back then, dissecting her fundraising efforts.
Oct. 5: After more than 18 months, state officials will schedule a Quality of Life meeting to hear neighbors' concerns about project impacts and operations.
That’s overdue, because even though there has been no new vertical construction, questions remain. What about the phantom Pacific Park Conservancy, supposedly overseeing the open space and the controversial dog run?