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December 25, 2007
Forest City Ratner: King of the PILOTs
Atlantic Yards Report
It's a Christmas story, sort of. Daily News columnist Juan Gonzalez, writing last Thursday in a column headlined, "Deals that lead to lost property taxes," highlighted the city's annual loss of $107 million "in property taxes last year because of privately negotiated deals with some of the world's richest companies." The abatements average "a whopping 60% per company." (Graphic from Daily News)
The report Gonzalez obtained presented Brooklyn's biggest developer as the city's savviest dealmaker. He wrote: The undisputed king of PILOTs is real estate developer Bruce Ratner. His Forest City/Ratner firm paid the city $9.7 million last year for half a dozen commercial buildings the company owns in downtown Brooklyn. That sounds like a lot of money - until you realize it's only one-third of the company's actual $26.3 million property tax bill.
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Gonzalez's column also included this tantalizing line:That doesn't even count PILOTs that have yet to kick in for Forest City's Atlantic Yards mega-project.
The numbers rgarding AY remain murky, but the September 2005 Atlantic Yards Fiscal Brief issued by the Independent Budget Office provides some clue. Low-cost financing for construction of the arena and its parking garage will come from tax-exempt private activity bonds issued by a not-for-profit local development corporation (LDC). But they wouldn't be repaid the way most bonds are repaid...
Not only is Bruce Ratner's development company, far and away, the City's largest beneficiary of PILOTS, read the rest of the Norman Oder's article to learn about yet another way the Atlantic Yards deal is structured differently than the ordinary megaproject.
Posted by lumi at December 25, 2007 8:38 AM