November 13, 2010
FCR's Morgan Stanley Building, Brooklyn Heights, issues of scale, and questions of government help
Atlantic Yards Report
Long before there was the grown-up boondoggle of Atlantic Yards, there was the little baby boondoggle of 1 Pierrepont Plaza in Brooklyn Heights.
In a profile of Steve Spinola, president of the powerful Real Estate Board of New York (REBNY), the New York Observer leads with an anecdote involving Brooklyn and, yes, Forest City Ratner:
Developer Bruce Ratner came to Steven Spinola for help in 1985. Mr. Ratner needed to get tenants for his planned MetroTech Center in Brooklyn, and Mr. Spinola was Ed Koch's economic development chief. Part of his job was to keep tenants in New York, and Morgan Stanley was thinking about moving its back offices to New Jersey.
"They were trying to convince Morgan Stanley to go to MetroTech... They asked me to go to a meeting with Morgan Stanley to discuss and to tell them that the city was ready to encourage them to do whatever."
...After Mr. Spinola's meeting with Morgan Stanley, the prospects for a deal looked dim. "We went down in the elevator. I turned to Bruce Ratner and I said, 'There's no way you get them to MetroTech.' I said, 'But I have a site on Pierrepont Street that's currently a garage. And one of my guys came to me two months earlier and said, "The city's about to give a new lease for this garage. We oughta have a cancellation clause in case we ever need it."'"
..."So I called up City Hall, I asked for it, they gave it to me. So I said to Ratner, 'Can you spend the weekend coming up with a design for a building on that site? I'll sole-source it to you if we can get Morgan Stanley to be the principal tenant.' And we made that deal."
The groundbreaking took place outdoors on the job site in 1986, Mr. Spinola remembered. Residents of Brooklyn Heights were protesting outside. They didn't want something so decidedly un-Heightsy—a bank back office, of all things—in their neighborhood.
In the 1980s, the city faced a real need to transform Downtown Brooklyn, so sole-source deals might have been somewhat more defensible. But they're still questionable as a policy.
Posted by steve at November 13, 2010 7:28 AM