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May 2, 2009
AY Report: Saturday Morning Edition
Norman Oder takes a look at the interview with New Jersey Nets CFO Charlie Mierswa in CFO Magazine.
In an interview in CFO Magazine headlined "It Still Hurts When You Lose." New Jersey Nets CFO Charlie Mierswa expresses unbridled optimism--and even convinced the reporter to state, without equivocation that "[i]n two years the franchise says good-bye to New Jersey and heads for a Frank Gehry–designed arena in Brooklyn."
Well, that timetable is in doubt, but Mierswa's interview is a reminder that Atlantic Yards backers are still betting on the new arena to reverse huge Nets losses, bring in new revenues, and raise the value of the team, which has actually declined since an ownership group led by Forest City Ratner's Bruce Ratner bought the team in 2004.
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Do you anticipate any problems raising the funds to build the stadium?
The project has the political support that it needs, and the reason is the number of jobs it's going to bring. The recent financing that the Mets and Yankees did — municipal debt with PILOT payments [payments in lieu of tax] — that's the same vehicle we are going to use. The Yankees's $370 million issue was oversubscribed. Clearly there's an appetite for that kind of financing. We met with the rating agencies and they were very enthusiastic. All we need is the green light. We expect to get it in the next three or four months. We think we will prevail in the remaining lawsuits.
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If the political support depends on jobs, the Mierswa either hasn't listened to Nets CEO Brett Yormark's affordable housing mantra or AY backers have given up on predicting that such housing would arrive in a timely fashion.
While it's likely that the state will prevail in the remaining lawsuits, appeals may last beyond Mierswa's timetable.
Beyond that, Forest City Ratner's cash crunch also may stall plans. Remember, the developer must deliver $100 million to the Metropolitan Transportation Authority before the Empire State Development Corporation starts exercising eminent domain.
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But you're also scaling back the architectural plans for the arena, right?
We're going through a process of "value-engineering" the stadium plans. That will bring down construction costs to a level that will facilitate the financing. There's no question it will continue to stand as a landmark in Brooklyn; it will also be economically viable in this marketplace.
That doesn't tell us whether Frank Gehry is still working on the arena or why, given Gehry's pride in working "tight to the bone," costs need to be cut nearly in half.
"Brooklyn Boondoggle," a short doc about AY, screens Tuesday
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I haven't seen Brooklyn Boondoggle, an 11-minute short film about Atlantic Yards that will be screened on Tuesday, May 5, at the Galapagos Art Space along with other short documentaries, so I asked about it.
"We didn't interview any politicians, or major activists - we simply went out onto the streets and talked to our neighbors about their feelings about the project," producer Zara Serabian-Arthur of Meerkat Media said in an email message. "We talked to folks who are being kicked out of their homes, business owners hoping for increased sales, young people hoping for jobs, families concerned that the development would lower their quality of life."
"Since there are already a lot of people doing good, in-depth investigative work into the project (including, of course, yourself, and the folks that made "Brooklyn Matters"), and we are by no means experts, the film simply tries to start a dialogue about this kind of top-down, corporate-led development, and serve as a tool for people in any city that is experiencing these kind of issues to rethink this model and imagine alternatives."
NoLandGrab: The frame shown is definitely NOT taken from "Brooklyn Boondoggle".
Posted by steve at May 2, 2009 7:34 AM