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March 11, 2010
"We still need more" subsidy, Forest City CEO said in April 2008, and they got it
Atlantic Yards Report
Looking back, one of the most telling episodes in the Atlantic Yards saga came in a 4/2/08 earnings conference call that Forest City Enterprises (FCE) held with investment analysis.
As I wrote, in response to a question from analyst Rich Moore, FCE Chuck Ratner expressed satisfaction in the developer’s relationship with local government, and said he expects more subsidy.
Forest City Ratner, FCE's New York subsidiary, had gained $105 million in subsidy on top of the initial pledged $200 million, at the time of the call. Since then, FCR gained (beyond other stated subsidies and tax breaks):
- a speed-up in delivery of pledged state and city subsidies
- an additional $31 million for land purchase (allegedly from infrastructure funds)
- a revised deal with the Metropolitan Transportation Authority for the Vanderbilt Yard, with only $20 million down (instead of $100 million), a smaller permanent yard, and a generous 6.5% interest rate
- a Development Agreement with gentle penalties and generous deadlines (12 years for Phase 1, 25 years for Phase 2)
Upcoming--and hinted at in the call--is the developer's effort to corral scarce subsidies for affordable housing.
Posted by eric at March 11, 2010 10:24 AM