September 11, 2009
CBN-commissioned report, by independent real estate analyst, cast huge doubts on official claims about timetable, benefits
Atlantic Yards Report
Representatives of the city and Forest City Ratner objected strenuously yesterday to the New York City Independent Budget Office (IBO) report concluding that the Atlantic Yards arena would be a loss for the city.
Perhaps soon they'll confront another report--discussed further below--that concludes that projections by the state and Forest City Ratner that the project would take ten years are way overoptimistic--and that the developer assumed rental and condo rates well over the current market.
That suggests delays in the project and thus delays in the promised benefits about which government officials and FCR seem so certain.
All the promised benefits, in fact, are premised on a ten-year buildout of the project. But the Council of Brooklyn Neighborhoods (CBN) yesterday released a sober assessment, by an independent real estate analyst, which concluded that "the project cannot be completed anywhere near 2019" and likely would take at least 20 years.
CBN submitted the report, “A Decades Long Project: Atlantic Yards Financial Feasibility Study [PDF],” as part of its comments to the Empire State Development Corporation (ESDC) on the 2009 Modified General Project Plan.
(It also submitted comments calling for a Supplementary Environmental Impact Statement, or SEIS, which I'll address in another post. CBN, a coalition of community and neighborhood groups concerned about or opposed to the project, has received funding via state and city officials.)
Presumably consultants AKRF will respond to the comments in a technical memorandum presented to ESDC board members before they vote to approve the project at their meeting September 17.
The report was commissioned from Kahr Real Estate Group, a firm that works with commercial and investment banks, private real estate investment firms, REITs, developers, and government organizations throughout the world.
Principal Joshua Kahr writes frequently for Urban Land, the monthly magazine of the Urban Land Institute, an organization that includes major developers, including FCE. In other words, he's hardly a flaming radical; nor would it be prudent of him to do work that would damage his credibility.
Click thru for highlights from the report.
NoLandGrab: Norman Oder also reminds us that when the IBO issued its initial report, in 2005, "Forest City Ratner had no problem with the IBO's methodology, praising it for concluding that the arena was a 'win-win' situation for the city and the state."
Posted by eric at September 11, 2009 5:53 PM