No Land Grab

Nets' arena talks on hold while MTA deals with Jets Saturday, February 5, 2005

By JOHN BRENNAN STAFF WRITER The Metropolitan Transportation Authority has told the New Jersey Nets to take a seat on the bench.

The reason: The MTA is too busy trying to work out a complicated deal with the New York Jets for a football stadium atop its rail yards in Manhattan to deal with the basketball team.

That means the Nets will have to wait indefinitely to pursue their own talks with the MTA about building a basketball arena atop MTA-owned land in Brooklyn.

"The Nets deal is absolutely on hold until this finishes," MTA Chairman Peter Kalikow told five New York State Assembly members at a public hearing about the Jets stadium Thursday.

MTA Executive Director Katherine Lapp said at the hearing that agency officials have held only general talks with representatives of Nets principal owner Bruce Ratner.

"We've had no discussions directly with them about the value [of the air rights], what they would purchase, etc.," Lapp said of the site at Atlantic and Flatbush avenues.

A spokesman for Ratner declined to comment.

Ratner undoubtedly will be keeping a close eye on the Jets talks, because his relocation plan is similar to that of the National Football League team.

The Jets are seeking binding arbitration as a way to bridge the wide gulf between the MTA's estimate of the value of the air rights above the Jets' stadium site.

The agency wants $300 million from the Jets for a one-third share of those air rights. The Jets say they should be required to pay only $35 million for full air rights, but they have offered $100 million. Kalikow said he would demand full market value from the Jets, dismissing suggestions by Assembly members that he has been asked by stadium supporters Gov. George Pataki and Mayor Michael Bloomberg to give the Jets a discount.

The Nets must work out their own air-rights deal with the MTA before proceeding on building an arena that would be the centerpiece of a $2.5 billion housing, retail and office complex controlled by Ratner. The air-rights value determined for the Jets' site may serve as a model for the Nets' project, known as Atlantic Yards.

New York Assemblyman Richard Brodsky, expressing skepticism of a plan to use former U.S. Sen. George Mitchell to settle the Jets' dispute, asked Kalikow how he could turn down an arbitration request by the Nets if the Jets are allowed to go that route.

"I don't know," Kalikow said.

The Nets are trying to finalize a Community Benefits Agreement with various neighborhood groups this month. That would allow the franchise to sign a deal to make the state-run Empire State Development Corp. the lead agency for the overall development.

The ESDC, which also is overseeing the Jets' deal, is expected to give its final approval to that plan this month.

A Ratner aide said last fall that the Nets' owners hope to begin construction of their project early in 2006, which likely would delay a move to Brooklyn from Continental Arena at least until 2008. An environmental impact statement must be completed, and a series of public hearings must be held before ground is broken. Supporters and critics also expect several lawsuits to be filed against the project.

E-mail: brennan@northjersey.com