New York State’s plan for Atlantic Yards has failed. Can we trust it to make a new one that works?
After the Atlantic Yards project (aka Pacific Park) was announced in December 2003, a finding of blight was necessary to redevelop a 22-acre area of Brooklyn under state law that allowed overrides of city zoning, bypass of local review, and use of eminent domain to assemble land. In this case, “the blighting influence of the below-grade [LIRR Vanderbilt] Yard and the blighted conditions of the area” were cited as justification for a project that would create a platform over the rail yard and construct six residential towers above them.
Twenty years later, it’s now clear that the platform for which the project was approved can’t be completed under the current plan. What went wrong?
Unlike other plans overseen by Empire State Development, that state agency never established a dedicated local development corporation with resources necessary to manage a $6 billion project. Instead, it trusted a single developer, Forest City Ratner Companies, to plan and build all sixteen buildings and an arena.
Although dense residential construction over a rail yard had never been proven economical outside of Manhattan, ESD never independently verified the project’s viability. Moreover, it agreed to defer construction of the platform and its buildings until the last phase of development. When FCRC ran into financial headwinds in 2009, ESD agreed to extend that last phase by another 15 years.
But in 2014, FCRC was out of capital, and ESD allowed it to sell 70% of the remaining project rights to Greenland USA, the American arm of developer Greenland Holdings, controlled by the government of Shanghai.
ESD then allowed the joint venture to transfer development rights over the rail yards into an LLC used to secure a $349 million EB-5 loan for immigrants with $500,000 to invest to obtain a green card. But construction never started there. Finally, last month it was revealed that Greenland had defaulted on repayment. Lenders have foreclosed on development rights over the rail yard, leaving work at a standstill for the foreseeable future.
As advocates who negotiated a 2014 settlement for a May 2025 deadline for completion of all of Atlantic Yards’ 2,250 affordable apartments, the failure of the project to accomplish its principal goal is unacceptable. The 877 affordable apartments remaining are planned for buildings on the platform — there is no possibility the deadline will be met.
Our settlement with New York State provided for damages of $2,000 per month for every apartment not completed by the deadline. It’s unclear who is now obligated to pay a monthly $1.8 million that becomes due in June 2025, but ESD has already shown it is willing to give the project a pass on penalties for missing a deadline to build a glass-enclosed atrium considered a key community benefit. So the public is stuck with a stalled project, a developer who can’t perform, and a state agency that prefers to sweep it all under the rug.
Where do we go from here? The Hochul administration can start by making clear that damages for failing to complete promised affordable housing will be collected, something that is critical if the public is to have any confidence about ESD’s future plans for the site.
Gov. Hochul should direct ESD to independently study the economic feasibility of building over the rail yard, something the agency has never done. She should then work with Democratic congressional leaders to fund any gap necessary for the remaining affordable housing to reach low-income Brooklyn residents. Finally, the breakup of control of the remaining project rights dooms ESD’s single-developer strategy.
The governor must reboot Atlantic Yards in the model of successful projects like Battery Park City and Queens West, where the state formed local development corporations that bid out sites to multiple developers to manage risk. To ensure transparent and accountable decision-making, an Atlantic Yards LDC should be overseen by a board that includes local elected officials and community members, as is the case at the Harlem Community Development Corp.
Even if Hochul does all of these things, it will still be many years until housing appears above the Vanderbilt rail yard. That’s why her administration must also identify sites near the project and fund deeply affordable housing to be developed now to meet an urgent local need.
Lack of progress on the governor’s housing plan, combined with an unrelenting affordable housing crisis, makes building housing at approved sites like Atlantic Yards even more critical. After two decades, New Yorkers deserve to see the project’s commitments to the public fulfilled.
de la Uz is the executive director of the Fifth Avenue Committee. Veconi is chair of the Prospect Heights Neighborhood Development Council.
from New York Daily News https://ift.tt/Ie6iHPS