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April 27, 2008

Economy, Credit Woes Foil Cities' Big Projects

Wall Street Journal
JENNIFER S. FORSYTH

One project being watched closely is Atlantic Yards, a $4 billion development that Forest City Ratner Cos. is building on 22 acres in Brooklyn, N.Y. After a number of court battles, the developer plans to finally begin construction on a new arena for the New Jersey Nets basketball team by the end of this year.

However, the schedule for its planned office tower, called Miss Brooklyn, likely be will pushed back until an anchor tenant is signed given the current market conditions, says Loren Riegelhaupt, a Forest City spokesman. He stresses that the entire project eventually will be built. "It's not a question of if, but when."

Atlantic Yards Report responded:

Well, the plan may be to break ground this year, but how can he be sure? As to whether the entire project will be built, well, there's no guarantee that housing subsidies will be available.

More importantly, the governmental authorities don't require the project to be built as approved; the State Funding Agreement includes a City Purpose Covenant that allows for the amendment of the General Project Plan and contemplates its abandonment for a smaller project. Maybe that's why Frank Gehry is laying off architects, as the Los Angeles Times reports on its blog.

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Posted by amy at April 27, 2008 9:11 AM