October 8, 2009
State Consultant: Ratner’s Assumptions at Atlantic Yards 'Moderately Aggressive'
by Eliot Brown
The report—which was not expected to be negative given that it was commissioned by the agency sponsoring the project—looked at Forest City’s planned numbers on rental rates, sales prices and absorption for the 14 apartment towers planned for the 22-acre site. The report assumed that the project would be built over 10 years, a schedule that even Forest City has said is aggressive, but is the official timeline of the project.
The verdict: Based on current trends, Forest City’s assumptions are “moderately aggressive,” “towards the high end of the range” that the consultant looked at, but “not unreasonable.”
The consultant, accounting giant KPMG, which also did a 2006 analysis on the project for the state’s development agency, said its conclusions were based on a couple of key assumptions made by Forest City:
1) the current real estate market will have recovered by the time the apartment units come online and 2) the Subject Property will be sold at a premium compared to the market place, given the Subject Property’s location, amenities, and newly developed status.
NoLandGrab: "Location, amenities, and newly developed status" doesn't seem to be doing much for all the other struggling condo projects in Brooklyn and none of those are smack-next-door to a sports arena and its 18,000 inebriated patrons. By Forest City's and KPMG's logic, Madison Square Garden, sitting atop Penn Station, should be surrounded by luxury buildings rather than fast-food joints.
Posted by eric at October 8, 2009 10:31 AM