Sunday, March 31, 2013

In Los Angeles, jobs, open space, and "new opportunities" part of pitch for Millennium Hollywood; journalist sees project as "an outgrowth of a perfect civic compost"

From a 3/28/13 Los Angeles Times op-ed essay, A real Hollywood flop: The Millennium Hollywood project is just what the city doesn't need, by former reporter Laurie Becklund:
On Thursday, the city's planning commission is likely to consider a development proposal that will affect the lives of everyone who lives in Hollywood or passes through it on the Hollywood Freeway, one of the most congested in the nation.
The 1.1-million-square-foot development, Millennium Hollywood, would be twice the size of the Los Angeles Convention Center and allow a tower nearly 600 feet high, vastly out of proportion with today's Hollywood. Its boosters say it would provide jobs, stimulate business, lure thousands of new tourists and "reinvigorate" Hollywood. The developers, a New York hedge fund and an owner of the land under Grand Central Station, are asking for an unprecedented 22-year contract to build out the sites just north of Hollywood and Vine.
Indeed, the planning commission approved the development unanimously. 

The pitch
A non-street level view

The project is being is pitched (see graphic at right) as offering "responsible, transit-oriented, mixed use development that will create new jobs, new pedestrian open space, an overall improved neighborhood, and new opportunities for Hollywood."

Along with the developers, Millennium Partners and Argent Ventures, "the Millennium Hollywood team is comprised of a world-class team of architects and urbanists," including Roschen Van Cleve Architects Handel Architects, and James Corner Field Operations. 

(The latter, by the way, has worked with SHoP on the interim open space on the arena block, though I'm not sure how much fo their design got used--it's not cited in Field Operation's list of projects--and the new New Domino plan in Williamsburg.

The "perfect civic compost"

Becklund wrote:
A Hollywood resident for 28 years, I started looking at this project almost two years ago, when I heard about it almost by accident. Since then, I've come to see it as an outgrowth of a perfect civic compost: a city budget crisis, mayoral politics, an understaffed newspaper stretched too thin to fully scrutinize the project and New York developers who specialize in "public-private partnerships."
You might say the same thing about some projects in Brooklyn.

Roundup: dressing spiffy at the Barclays Center, and the art within

Here are a couple of articles that, along with the Brooklyn Nets' entry into the playoffs (see photo of hew #HelloPlayoffs arena signage at right), have to be considered part of a successful arena rollout.

Dressing fancy

A regular Wall Street Journal feature on clothes at the workplace arrived 3/27/13 with What They’re Wearing at the Brooklyn Nets and Barclays Center:
Whether it’s dressing for a basketball game, an Alicia Keys concert or a business meeting with Jay-Z, looking sharp is a must for the employees of the National Basketball Association’s Brooklyn Nets team and their home arena, Barclays Center. That means a shirt and tie for men, who make up about two-thirds of the roughly 200 employees at the venue and a separate office at 15 MetroTech Center in downtown Brooklyn.
“Our CEO [Brett Yormark] really sets the standard here, so I try to take a cue from him,” says Kari Cohen, associate counsel. “I’ve never seen him in anything except for a suit and tie, and it’s always impeccable.” She tries to emulate that level of style, albeit with a skirt or dress.
“I go into it with the thought that I’m essentially an extension of [Mikhail] Prokhorov, [Bruce] Ratner, Mr. Yormark, and Shawn Carter (Jay-Z),” says Emmanuel Jacobo, who manages suite sales and services, including the arena’s 11 exclusive Vault rooms, which rent for $550,000 a year.
Yormark, of course, sets some other standards.

But the article has to be considered confirmation of the Brooklyn rebrand:
The Nets' move to Brooklyn has meant a style change for her. "I probably wouldn't dress like this in New Jersey," said Ms. [Irina] Pavlova [of Onexim]. "You want to look good here. You want to dress up. It's very exciting. It feels like there's good energy to be here. New Jersey just felt dead."
Arena art

A 3/28/13 article/slideshow in the art/design publication Complex is headlined Interview: David Berliner Gives a Tour of the Art at Barclays Center:
The Barclays Center, home of the Brooklyn Nets, is also home to a series of art commissions that will only multiply in the months and years to come. The stadium currently has one-of-a-kind pieces by José Parlá, Mickalene Thomas, and OpenEndedGroup, in addition to a new series of photographs celebrating The Black Fives, a series of African-American basketball teams in Brooklyn before the racial integration of the NBA.
Board member and executive director, David Berliner, gave us a behind-the-scenes tour of the art pieces they have at The Barclays Center so far. Of the decision to have art there, he says,
"The idea of putting art somewhere that isn't a museum is interesting to me, because people don’t know what they are going to get, and they can start to see something in a new way. That’s why I like putting art in this place, because people don’t come here for the art. In the first year alone, this building will have 2.6 million people come through it. It's just the idea of exposing people to this art. It’s amazing when you think about how much power we have."
And they have a little money left over from, say, not providing arena employees with health insurance.

Saturday, March 30, 2013

Candidate Liu says he refused to take part in arena groundbreaking, ribbon-cutting, won't go to games, wants "real jobs, not selling popcorn"

I wrote earlier this week about Forest City Ratner-related contributions to the mayoral campaigns of Bill de Blasio, Bill Thompson, and Christine Quinn, noting how John Liu is probably (and perceivedly) the main candidate most critical of Atlantic Yards and development.

Indeed, Prospect Heights Patch reports on a visit by Liu to the Parliament Democratic Club in Fort Greene:
"I've had serious issues with the whole Atlantic Yards development over the past 10 years," he said. "It was supposed to be about jobs and affordable housing, and 10 years later all we've got is a stadium and some popcorn vendors. That is not the economic development people were looking for. [Officials connected to the development] kept calling and I refused to take part in the ground-breaking; they kept calling and I never participated in the ribbon cutting; they keep calling and I'm not going to any games."

Though he hasn't looked favorably at the development thus far, Liu said he wants to see affordable housing come to the development, and he wants to see jobs tied to the development be given to Brooklyn residents. "Real jobs, not selling popcorn. No offense to people selling popcorn, I love popcorn. But that is not the economic development that was promised."
One tower is under construction, but, as Liu points out, it's a lot harder to claim that the promise of "Jobs, Housing, and Hoops" is being fulfilled.

Flatbush avenue's Vegetarian Palate to move: arena-goers affected takeout business

From the Brooklyn Paper's Eastbound and up: Prospect Heights businesses are on the move:
“Rent over here is much higher,” said Ronald Wong, the owner of Vegetarian Palate, which will end its 11-year stay on Flatbush Avenue to move to Washington Avenue in early summer as the landlord converts the old building into condos. “It has to do with the Barclays Center. Since it opened, it has affected our dining and business.”

Wong says his brisk takeout business suffered as arena-goers started parking on the block during events and parking enforcement officers increased their vigilance — with no real uptick in orders from stadium attendees.
Well, it sounds like the restaurant would be moving anyway, given the landlord's decision, but it is notable that a restaurant geared to locals would be affected by arena crowds. Some restaurants or bars manage to attract a mixed crowd, but a Chinese vegetarian restaurant is not likely to be among them.

Friday, March 29, 2013

From Crain's New York Business 40 Under 40: FCR's Melissa Burch, solving problems (and here's how it's done)

From a Crain's New York Business "40 Under 40" issue profile of Melissa Román Burch, 36, Forest City Ratner Cos., Senior vice president:
As a senior vice president of residential and commercial development at Forest City Ratner, the Harvard College and Harvard Business School grad and Upper East Side resident has been involved in every aspect of the $4.9 billion Atlantic Yards project since its inception 10 years ago.
"I was knocking on doors, telling people I'd like to speak to them about purchasing their property," she recalled. "I was trying to acquire the New Jersey Nets basketball team and purchase air rights from the Long Island Rail Road." Now Ms. Burch is heading the project to build the first residential building on the site, a 32-story tower that will feature the tallest modular building ever constructed. "We think this is going to launch a new industry in New York," she said of the modular system.
..."A lot of what a developer does is solve problems," said MaryAnne Gilmartin, the executive vice president of Forest City Ratner who has been tapped to replace Bruce Ratner as CEO. "You have to feel comfortable with that constantly changing dynamic, and Melissa's adeptness and comfort with change makes her such an asset to the organization."
Solving problems

How exactly does Burch solve problems? As I reported for City Limits' Brooklyn Bureau 8/26/12, in Agency, Developer Wrestle Over Atlantic Yards Affordability, the New York City Housing Development Corporation [HDC] wanted Forest City to increase the number of two-bedroom affordable housing units:
HDC apparently asked the developer to alter the mix of affordable units by shifting 15 of the proposed one-bedrooms to two-bedrooms, and gearing these for families in the 120 percent and 150 percent AMI bands.
That proposal, skewed toward middle-income subsidized units, was unacceptable to the devel-oper. Forest City's Melissa Burch offered a counterproposal: "We want to find common ground that gives HDC the 20 percent 2BRs that are important for your mission and at the same time helps close the $2M funding gap” created by the reassignment of 15 one-bedroom units to two-bedroom units.
To save $1 million of that stated “funding gap,’ Forest City asked that the 15 larger units be allocated solely to the higher 150 percent AMI band.
HDC seemed to take the deal. "We of course prefer more affordability," Tally responded to Burch, "but we will accept it. We'd like your commitment that this will be the minimum level of affordability [for this tower] no matter how future conditions may affect the budget."
In response to questions about the negotiations, HDC stresses that the specifics of the Tower 2 deal are still in flux. To that end, the income mix has shifted since the last email exchange contained in the documents City Limits obtained: HDC now says that of the 15 additional two-bedroom units, two will be for middle- and moderate income families below the 150 percent band, while a 16th unit will serve low-income families.
What does "close the $2M funding gap" mean? It means "save us $2 million in costs."

Forest City executives conference call: rent from Islanders key to stabilizing arena income

There were a couple of Barclays Center mentions during yesterday's conference call held by Forest City Enterprises with investment analysts.

Would arena operating income, given the success of the the arena so far, stabilize before the projected 2016?

Responded CEO David LaRue, "We’re still anticipating a 2015-16 stabilization [cited in year-end results]... That’s the hockey season, when the Islanders finally move in... we have projected that $70 million stabilized NOI [net operating income] number once the Islanders are and we have the benefit of that initial anchor."

That seems to suggest that the rent from the Islanders will be key to stabilizing the operating income. But the Islanders' move was not guaranteed when they decided to build the arena at the cost projected. Presumably arena operators figured they could/would do something to increase occupancy.

"In terms of ramping up, between now and then," LaRue added, "I think the 82% of the contractually obligated rent being signed us to have a substantial increase in our revenues over the course of this 2013 operating year and move towards that stabilized projection. So, without giving you that exact number, we are on track moving towards that stabilized $70 million annual."

Everything's for sale

At one point, discussing the developer's business decisions to bring in new investors and to divest in non-core markets, CFO Bob O'Brien observed, "I often say that everything is ultimately for sale, at a price, and if we can get full value in some of our core markets or products, that's what we would consider."

I think it's safe to say that, not only was the Nets basketball team for sale, at a bit of a fire sale price, when the developer needed capital, the remaining 20 percent of the Nets will be sold when the price is right.

Not to mention a piece of Atlantic Yards.

Forest City re-interprets Atlantic Yards Phase 1: arena block plus Block 1129, to the southeast. The platform for the blighted railyard has 15 years (and who knows when the towers rise)

Update March 29: In my initial post yesterday, I neglected to point out what I reported last October  regarding previous comments about the construction sequence; the Development Agreement, released in January 2010, gives the developer 15 years to start the platform after the project Effective Date (May 2010). So this revision has a few changes.

It's official. Atlantic Yards developer Forest City Enterprises (FCE) in a document released yesterday has confirmed that its Forest City Ratner subsidiary has no plan to build an expensive deck over the 8.5-acre Vanderbilt Yard--the most clearly blighted part of the 22-acre Atlantic Yards site, and a major justification for eminent domain--before building four towers on the southeast block of the site, Block 1129.

That sets up, as the graphic at right suggests, a odd map in which the "project" leapfrogs one long block between Sixth and Carlton Avenues.

That leaves the below-grade railyard waiting for an expensive deck (which can wait 15 years) and furthering development on the main piece of terra firm beyond the arena block. It further undermines the once-promised plans to build the 16-tower project in ten years, rather than the 25 years permitted by state contracts.

And the document raises questions about whether and when that deck will be built. Even if they build it soon after constructing a new railyard, they're not planning to build over it soon.

Sequence questions

The sequence also raises questions about the ongoing Supplementary Environmental Impact Statement (SEIS) process for Atlantic Yards, in which Empire State Development, the state agency overseeing the project, is supposed to examine the community impacts of multiple potential sequences.

While the forthcoming Scope of Analysis, a prelude to the issuance of a Draft SEIS, will surely mention the once-promised clockwise buildout east from the arena block, which would mean prompt construction over the railyard, that seems completely unrealistic, given Forest City's announced plans.

So, while the southeast block remains formally part of Phase 2 in the state plan, Forest City for business purposes considers it part of its first phase.

Forest City's empty claims

To the New York Observer, company spokesman Joe DePlasco claimed that sequencing for Phase 2 had yet to be determined. But the new documents confirm Forest City's plans to build first on Block 1129. And DePlasco's claim that there is still a construction deadline for the new railyard is irrelevant, since the question is when they'd build an expensive deck over that railyard.

The news further undermines that misguided New York Times article last April, which stated:
For Forest City Ratner... the [retail] changes are evidence that the arena has already met its goal of transforming a dreary section of Brooklyn — the Long Island Rail Road’s rail yards and surrounding industrial buildings, which the company’s spokesman described as “ a scar that divided the neighborhood.”
Stated in October, confirmed yesterday

Forest City Ratner executive MaryAnne Gilmartin last October told investment analysts "we have seven buildings that we will build before we commence construction on any platform buildings."

From the report; click on graphic to enlarge
In the FCE annual report 10-K filed yesterday with the Securities and Exchange Commission, the company offered a new interpretation of the Atlantic Yards phases, which according to state documents have been separated by Sixth Avenue, leaving the arena block and adjacent Site 5 (across Flatbush Avenue) in Phase 1 and all buildings east of Sixth Avenue in Phase 2.

The annual report stated:
Phase I of Brooklyn Atlantic Yards  is comprised of eight buildings totaling approximately 3.4 million square feet—four buildings on the Arena Block (adjacent to the Barclays Center ) and four buildings on Block 1129. Phase II consists of seven buildings totaling approximately 3.3 million square feet—three buildings on Block 1120, three buildings on Block 1121 and one building on Block 1128.
(Emphasis added)

While Gilmartin said "seven buildings" and the annual report said eight, in actuality, there could be nine buildings in the new Phase 1: four buildings on the southeast block, four on the arena block, and one on Site 5, currently home to P.C. Richard and Modell's.

Given that the flagship tower at Flatbush and Atlantic avenues is slated to be an office tower, for which there is no market, and Site 5 may be an office tower, it sounded like Gilmartin was being cautious.

The irony, of course, is that initial plans in 2003 for Atlantic Yards completely omitted the southeast block of the site, as indicated in the graphic above, which was limited to the arena block and then the two blocks to the east containing the rest of the Vanderbilt Yard.

Why was that southeast block added? Likely for construction staging, parking, and to increase the amount of development.

SEIS impact?

The 10-K states:
As a result of ongoing litigation, a Supplemental Environmental Impact Statement ("SEIS") is required to be completed before proceeding with a portion of Phase I and all of Phase II of the project. We do not expect that the current ongoing litigation and SEIS process will affect the development of the four buildings located on the Arena Block within Phase I.
Again note this reinterpretation of the notion of Phase 1. ESD's June 2009 Modified General Project Plan describes the Phase 1 site as the "portion of the Project Site west of 6th Avenue" and the Phase 2 site as the portion east of 6th Avenue.

Will new railyard, deck be built?

Such regulatory documents are supposed to disclose risks, whatever the likelihood, and this one raises questions about the railyard:
A substantial amount of additional costs for railyard and infrastructure improvements will be required to proceed with Phase II of Brooklyn Atlantic Yards. More specifically, there is an upcoming December 31, 2013 deadline to commence construction on the Permanent Railyard and to post the completion guaranty for such work. If we choose to begin construction on the Permanent Railyard by December 31, 2013, it must be substantially completed by September 30, 2016. We have previously provided an $86 million letter of credit to the Metropolitan Transit Authority ("MTA") as collateral for such future work related to the construction of the Permanent Railyard. In order to construct the aforementioned eight buildings in Phase II, we will be required to construct a platform over the new Permanent Railyard.
Alternatively, if we do not commence construction on the Permanent Railyard by December 31, 2013, we will be in default of various MTA project agreements and the MTA will have the ability to draw down our $86 million letter of credit. We would also lose approximately 3.3 million square feet of development rights for Phase II of Brooklyn Atlantic Yards.
Will Forest City give up $86 million and 3.3 million square feet of development rights? Unlikely. The developer can lobby for more subsidies to shift the risk. They can always wait to build those development rights. Also, as the document relates,  the Company may elect to pursue future vertical development of this project with joint venture partners."

And, I'd add, they could always lobby the MTA to revise the deal, as they did with the original Vanderbilt Yard deal.

Still, if everything goes wrong, FCE could face $600 million in losses, including liquidated damages for failure to the city and state of New York to meet certain deadlines for the first few towers.

Modular risks

The new modular technology used in the first Atlantic Yards tower, and the factory to build modules, add development risk, including pressure from unions:
We have partnered with a large international development and construction company to operate a facility for the fabrication of apartment modular units that will be used in the construction of B2 BKLYN,  a multi-family highrise in Brooklyn, New York, which is expected to be 32 stories and contain 363 apartment units.
In addition to risks inherent in construction projects generally, such as unanticipated site conditions, environmental, and force majeure issues, the following additional risks exist with setting up the modular facility and constructing B2 BKLYN using modular methodology:
• Facility start-up costs can be more than anticipated, which would require additional equity;
• The facility setup might take longer than anticipated, which would lead to the delay of the completion of B2 BKLYN;
 • High rise modular has not previously been done at the heights of B2 BKLYN ; therefore, the design may need to be revised and assembly may not occur as expected, each having the potential to cause project delays and additional construction costs;
• Our partner could experience financial difficulty and be unable to cover its share of cost overruns, which could impact the timely completion of the project or require us to infuse additional equity;
• Third party claims that any element of the design or construction methodology infringes on protected intellectual rights could delay the project and increase construction costs; and
• A plumbers' organization has requested the City Building Department to explain its issuance of permits and approvals for the production of modules at the facility where the modular units will be constructed, in light of New York City building code licensing requirements. Any claim or claims filed in connection with this request could delay the construction, and increase the construction costs, of B2 BKLYN.
I reported in January on the questions raised by unions and trade associations representing plumbers.

Thursday, March 28, 2013

Bruce Ratner, who sells Brooklyn, explains why Yonkers mall is named for Westchester: "No business today can survive simply on a city or a town, it has to survive on a whole region."

Once you reach 1:21 in the video below, please make sure you have no liquid in your mouth.

The Eyewitness News story, keyed to the opening of a Legoland at Forest City Ratner's Ridge Hill complex in Yonkers, resurrects an old complaint: the mall--formally "Westchester's Ridge Hill"--is named for the affluent county, not the gritty city.

Mayor, Mike Spano (once a Forest City Ratner lobbyist) asked for reconsideration, but really, that decision was made before he took office.

But then catch the snippet from Forest City CEO Bruce Ratner at 1:21: "No business today can survive simply on a city or a town, it has to survive on a whole region." Then he does that super-convincing hand-waving thing.

Yeah, the same Bruce Ratner who has sold the heck out of "Brooklyn" to the point where it dwarfs "Nets" and, not so long ago, said, "There's no better place in the world than Brooklyn."

The famous region.

Forest City Enterprises reports better year-end results, 82% of forecasted contractually obligated arena revenues (before hockey)

Along with the 10-K document that revealed Forest City Ratner's plans to delay a deck over the Vanderbilt Yard, Forest City Enterprises yesterday issued a press release, Forest City Reports Fiscal 2012 Fourth-Quarter and Full-Year Results, indicating better results, as well as an increase in contractually obligated arena income:
Fourth-quarter FFO [funds from operations[ was $77.5 million, compared with a loss of $40.7 million in the fourth quarter of 2011. On a fully diluted, per-share basis, fourth-quarter 2012 FFO was $0.36, compared with a per-share loss of $0.24 in 2011.
Full-year 2012 FFO was $267.4 million, or $1.27 per share, compared with $178.2 million, or $0.88 per share for 2011. The primary factor contributing to the year-over-year FFO variance was a decrease in the net loss on land held for divestiture activities of $123.8 million ($75.8 million net of tax) related to the company's 2011 decision to divest a significant portion of its land development business.
...Fourth-quarter Operating FFO was $41.9 million, compared with fourth-quarter 2011 Operating FFO of $52.4 million. Full-year 2012 Operating FFO was $234.7 million, compared with $227.5 million for fiscal 2011...
Net Earnings/Loss
Fourth-quarter net earnings attributable to Forest City Enterprises, Inc. were $58.5 million, compared with a net loss of $105.4 million in the fourth quarter of 2011. Net earnings for the fiscal year ended January 31, 2013 were $36.4 million, compared with a net loss of $86.5 million for fiscal 2011.
Better partnerships, but losses in Brooklyn offices

"We made significant progress during 2012 in our strategy of building a strong sustaining capital structure, deleveraging our balance sheet and improving our debt metrics," said FCE CEO David LaRue, citing partnerships with the Arizona State Retirement System for a $400 million multifamily development fund and TIAA-CREF on 8 Spruce Street in Manhattan.

Also, he said, "as we recently announced, we negotiated and closed a new, three-year $465 million revolving credit facility with improved pricing and more flexible, favorable terms."

While "[o]perating FFO from the company's Real Estate portfolio increased $11.9 million for 2012," thanks to lower interest expense, a change in fair market value of derivatives, increased sales at the Stapleton project, and a ramp-up of new properties, there were some offsets, including "non-recurring 2011 lease cancellation fee income of $6.5 million at two Brooklyn office properties."

Presumably there will be some follow-up.

Arena opening; 82% of income

The press release stated:
The largest of the 2012 openings was Barclays Center arena, an anchor element of the Atlantic Yards mixed-use project in Brooklyn. Home of the NBA Brooklyn Nets, Barclays Center opened in September and has already welcomed approximately 1.4 million visitors for concerts, professional and collegiate sports, family entertainment and other events. In October, Forest City announced that the NHL New York Islanders will play their home games at the arena beginning in the 2015-16 season. Eighty-two percent of forecasted contractually obligated revenues for the arena are currently in place and day-of-event revenues (including single-ticket sales and concessions) have been in line with expectations to date.
In September 2012, the contractually obligated revenue figure was 75%, not 82%.

The 2012 Annual Report Supplemental Package states:
b) Annual NOI for the Barclays Center Arena is expected to stabilize at approximately $70 million at full consolidation in the 2016 calendar year. Based on the partnership agreement, we expect to receive 55% of the NOI allocation until certain member loans are repaid. Therefore, we have included a stabilization adjustment to the Q4 2012 NOI to arrive at an annual stabilized NOI of $38.5 million.
It also indicates that the income will go up when the Islanders start paying rent, which suggests the move might be crucial:
[The 82% figure] represents the percentage of forecasted contractually obligated arena income that is under contract. Contractually obligated income, which include revenue from naming rights, sponsorships, suite licenses, Nets minimum rent and food concession agreements, accounts for 72% of total forecasted revenues for the arena. Percentage at January 31, 2013, excludes anticipated rent from the New York Islanders since the team is not anticipated to relocate to Barclays Center until 2015 and is subject to approval by the NHL.
Arena revenues

The document states:
The Arena naming rights agreement with Barclays Services Corporation, which commenced with the opening of the Arena, has a 20-year term, subject to certain extension rights. Arena naming rights revenue is recognized on a straight-line basis over the contract year.
Arena founding partner and sponsor agreements entitle the parties to certain sponsorship, promotional, media, hospitality and other rights and entitlements. These agreements expire at various terms ranging from one to seven years from the opening of the Arena and is recognized on a straight-line basis.
Arena suite licenses entitle the licensee the use of a luxury suite in the Arena. The terms of the suite license agreements commenced on the date the Arena opened with terms ranging from one to seven years. Revenue is recognized on a straight-line basis over each contractual year.
Ticketing fee revenue is based on the Arena's share of ticket sale fees in accordance with an agreement with Ticketmaster. Revenue from ticketing fees is deferred and recognized upon settlement of the related event.
What about the Nets

According to the annual report 10-K, in the past year Nets Sports and Entertainment still had to fund Nets losses:
The Company's ownership interest in The Nets is through Nets Sports and Entertainment LLC (“NS&E”). NS&E also owns Brooklyn Arena, LLC (“Arena LLC”), an entity that through its subsidiaries oversaw the construction of and has a long-term lease in the Barclays Center arena, the home of The Nets. NS&E consolidates Arena LLC and accounts for its investment in The Nets on the equity method of accounting.
On May 12, 2010, entities controlled by Mikhail Prokhorov (“MP Entities”) invested $223,000,000 and made certain funding commitments (“Funding Commitments”) to acquire 80% of The Nets, 45% of Arena LLC and the right to purchase up to 20% of Atlantic Yards Development Company, LLC, which will develop non-arena real estate. In accordance with the Funding Commitments, the MP Entities agreed to fund The Nets operating needs up to $60,000,000.
The MP Entities met the $60,000,000 funding commitment during the three months ended July 31, 2011. As a result, NS&E was required to fund 100% of the operating needs, as defined, until Barclays Center was complete and open, which occurred on September 28, 2012. Thereafter, members’ capital contributions are made in accordance with the operating agreements. During the year ended January 31, 2013, the Company funded $9,619,000 of The Nets operating requirements, net of the reimbursement
from the MP Entities for funding related to the 2012-2013 season.
But the team value is way up.
Barclays Center financing

The document states:
As of January 31, 2013, we had three nonrecourse mortgages greater than five percent of our total nonrecourse mortgage debt and notes payable. The mortgages, encumbering New York Times , an office building in Manhattan, New York, Westchester’s Ridge Hill  and Barclays Center arena,  have outstanding balances of $640,000,000, $472,000,000 and $371,655,000, respectively, at January 31, 2013.
This is presumably beyond the $511 million in arena financing.

Variable Interest Entities

The document cites various joint ventures, including the arena:
The Company’s VIEs consist of joint ventures that are engaged, directly or indirectly, in the ownership, development and management of office buildings, regional malls, specialty retail centers, apartment communities, military housing, a hotel and The Nets. As of January 31, 2013, the Company determined that it was the primary beneficiary of 31 VIEs representing 22 properties (19 VIEs representing 10 properties in the Residential Group and 12 VIEs representing 12 properties in the Commercial Group).
The creditors of the consolidated VIEs do not have recourse to the Company’s general credit.
...During the year ended January 31, 2013, the Company determined that the entity that owns Barclays Center is deemed to have sufficient equity and cash flows to support its operations without the need of any additional financial support from its partners. As a result, the Company determined that it no longer qualified as a VIE. The impact of the removal of this VIE within the VIE parenthetical disclosures on the Consolidated Balance Sheets were decreases of $552,226,000 to real estate, net, $1,405,000 to
cash and equivalents, $17,574,000 to restricted cash and escrowed funds, $26,681,000 to other assets, $192,958,000 to nonrecourse mortgage debt and $84,908,000 to accounts payable, accrued expenses and other liabilities from the balances disclosed at January 31, 2012.

Wednesday, March 27, 2013

Campaign contributions: Forest City bundles for Thompson, de Blasio, Squadron, even gets Republican subcontractor in Virginia to pony up

So, does developer Forest City Ratner support any candidates in the 2013 election?

Campaign finance reports suggest significant support via bundling for mayoral candidates Public Advocate Bill de Blasio and former Comptroller Bill Thompson, as well as some support for Council Speaker Christine Quinn.

Notably, a prominent Republican executive in Virginia, whose steel company produces key components for both the arena and the first modular tower, has contributed $1,000 to Democrats Thompson and Quinn, in one case through an FCR intermediary. (Do the candidates know his company is non-union?)

Comptroller John Liu, probably (and perceivedly) the main candidate most critical of Atlantic Yards and development, has received no FCR-related contributions. (His campaign also has some ethical question marks.)

In the race for Public Advocate, where anti-Atlantic Yards Council Member Letitia James is one of three candidates, Forest City-related contributions clearly favor fundraising leader state Sen. Daniel Squadron, who's pretty much sat out the AY debate and is close with project supporter Sen. Chuck Schumer.

Contributions to de Blasio

In June 2011, Bruce Ratner hosted a birthday party/fund-raiser for de Blasio. In February 2012, the New York Post reported that there were two snags in FCR-related contributions to de Blasio. First, $4,500 of $8,500 total were not listed as coming through an FCR intermediary.

Second, the intermediary was listed as FCR construction chief Bob Sanna, though, as the Post's David Seifman wrote, "There’s no way Sanna would do any of this without direction from Ratner, who has made no secret of his support for de Blasio." (That doesn't prevent Sanna from being the formal conduit, however.)

Sanna as intermediary has now raised a total of $13,600 for de Blasio, or $5,100 since last year's filing. Most of the individuals have some piece of the Atlantic Yards project as subcontractors.

Note that Forest City executive Ashley Cotton, who left the New York City Economic Development Corporation in early 2012, is mistakenly listed for this 2013 contribution in her old job.

Contributions for Thompson

Forest City has a long history of helping Thompson. As I reported in September 2006, in 2001, Michele de Milly, whose firm has long done p.r. for FCR, organized five contributions of $4500--for a total of $22,500--to Thompson's campaign for city comptroller.

The donors were Bruce Ratner's brother Michael, Michael's wife Karen Ranucci, Ratner's companion (and now wife) Pamela Lipkin,  Ratner's daughter Rebecca Ratner, and his sister Ellen Ratner.

As shown in the graphic below, Sanna in recent months bundled $4,000 for Thompson, significantly from Atlantic Yards subcontractors.

The largest donor, at $1,000, is Don Banker of Lynchburg, VA, CEO of Banker Steel, which has major contracts for the arena and first tower.  (In 2009 Banker lent his plane to the three-member state Republican ticket, along with Mitt Romney, former Massachusetts governor and presidential candidate, according to the Washington Post.)

Also, Bruce Ratner bundled $8,900 in the form of two maximum $4,950 contributions for Thompson,  from Arthur and Selma Rabin.

Arthur Rabin, as the screenshot at right suggests, is a longtime Nets investor and member of the board that runs the team and has majority ownership in the arena.

More Thompson connections

Ratner's sister Ellen Ratner has also given the maximum to Thompson and to Squadron, as the screenshot below shows.

So too has Ratner's wife Pamela Lipkin.

Squadron contributions

Beyond the two max Squadron contributions noted above, Bruce Ratner bundled two max contributions from the Rabins. That's total of four contributions worth $17,800.

Forest City's Ashley Cotton also has given Squadron $400.

Other FCR-related contributions

The list below of most (but not all) contributions from people reporting Forest City Ratner as an employer doesn't provide much of a pattern--and, of course, not every contribution is driven by corporate interests.

Most of the smaller contributions, which come at different times, seem unrelated, though there are two simultaneous $175 contributions to Thompson, which may have come at a single fundraiser.

Note that FCR Executive VP Maryanne Gilmartin, Ratner's heir apparent, contributed $1,000 to Quinn in 2007, before both Quinn and incumbent Mayor Mike Bloomberg got their third terms.

More from Banker

Virginia-based steel executive Banker gave $1,000 not only to Thompson, as noted above, but also, as the screenshot below shows, to Quinn. He also contributed $250 to Manhattan Borough President candidate Council Member Jessica Lappin.

Why Lappin? Hard to tell, though Gilmartin a few months later gave Lappin $320.

Forest City does more work in Brooklyn than Manhattan, but may be bidding soon on a big Lower East Side project.

A contribution to Suajani

Ratner's daughter Rebecca (assuming it's not another person with her name) gave the max contribution to the third Public Advocate candidate, Reshma Saujani, likely for reasons unrelated to any development issues.

At the B4 site, a caucus of empty chairs where the construction trailers once sat

There were construction trailers for quite a while below grade at the northeast corner of the arena block, the site of the future B4 tower, which is slated to be the third constructed around the Barclays Center, leaving only the flagship office tower at Flatbush and Atlantic to languish.

The trailers were removed last week from the site, at the southwest corner of Atlantic and Sixth avenues. A few chairs were left.

Barclays Center releases event calendar for April: 13 dates (plus NBA playoffs)

The Barclays Center has released the April event calendar. There are only 13 dates listed, but... the NBA playoffs start April 20 and the Nets will host at least two home games in the first round, more if that goes longer and/or they go on to future rounds. (The March calendar is here.)

Tuesday, March 26, 2013

"Posing for holy cards": how the press gets reminded of team/arena civic virtues, but misses more questionable issues

“News is what somebody somewhere wants to suppress; all the rest is advertising,” the British publisher Lord Northcliffe famously said, and while that may be sweeping, it's a good frame to analyze how and when certain press coverage emerges.

As I wrote 3/10/13, If the New York Times says so, then you know it's true: Nets Make Full Effort to Fit Into Brooklyn.

That article, focusing on an unspecified donation to a Brooklyn Boys & Girls Club by Nets/arena CEO Brett Yormark, surely was generated by a p.r. pitch. (Remember, his longtime strategy was a press release a day.)

In other words, advertising. (The story's now on Patch, since the dedication event is tomorrow.) Also advertising-like is the coverage of principal owner Mikhail Prokhorov's expression of happiness that the team would make the playoffs.

By contrast, consider the non-coverage of the news that the lowest price for Nets tickets next year will rise to $25, from a much-hyped $15 in the inaugural season.

To report that would mean not relying on the Nets' shorthand that prices, overall, would rise 8 percent, but to do a little work--to compare the charts for each season. Actually, it would require not much work, since a spreadsheet-savvy Nets fan did it himself.

The need for "antimanipulation"

It all makes me wonder how often people in the news business remind themselves of the need for "antimanipulation," that deliciously apt topic in a progressive Russian school, as described in Clifford Levy's 9/15/11 Times Magazine article My Family’s Experiment in Extreme Schooling:
New Humanitarian had standard subjects, like history and math, and Danya had many hours of homework a week. But Bogin added courses like antimanipulation, which was intended to give children tools to decipher commercial or political messages.
One example of such antimanipulation--completely routine in execution, but unusual since it went against the tide--was the 2/15/13 report Most Barclays Center Jobs Are Part-Time With No Benefits.

It was so unusual it made the back page (see bottom right) of a recent issue of the New Republic, as a staffer tallied "compelling" recent reading.

Another example: the Brooklyn Eagle's anomalously skeptical coverage, in January 2012, of developer Forest City Ratner's failure to hire the promised Independent Compliance Monitor for the Atlantic Yards Community Benefits Agreement. That story could be written yet again, given the developer's flat statement last month, without regret, that there's no plan to hire such a monitor.

But the big news today, as the Daily News cover at left suggests, is that MTV's Video Music Awards show is coming to Brooklyn.

"The show last aired from New York in 2009, when it took place at Radio City," the Daily News reported, featuring enthusiastic quotes from Mayor Mike Bloomberg and Borough President Marty Markowitz about the boost to the local economy and the borough's image.

To the Post, MTV President Stephen Friedman cited "[t]The vibrancy and cultural prowess that's now coming out of Brooklyn – whether it’s the music scene, sports scene or food scene" and noted that many staff members live in Brooklyn.

“There is a lot of local pride with the young people who work there,” he added. “You don’t get that at a lot of other venues.”

Sure, they've been trained to be cheerful and prideful. Surely they are--to a point. But they still don't have health insurance.

"Posing for holy cards"

Consider the coverage of a recent competition for fans to design Brooklyn Nets-themed sneakers, with judging by players and the hip-hop star Fabolous.

The Nets and the Barclays Center frequently host such "community" events. They have their value, but those reporting on them should remember what they're not being told.

A 3/17/13 op-ed in the Times by Michael Mudd, a former executive VP at Kraft Foods, headlined How to Force Ethics on the Food Industry, offered a reminder:
Next time you hear of a big food or beverage company sponsoring an after-school physical activity program in your community, you can be sure they’ll say it’s to show “our company’s concern for our kids’ health.” But the real intent is to look angelic while making consumers feel good about the brand and drawing attention away from the unhealthful nature of the company’s products. “Posing for holy cards,” as one of my colleagues used to put it.
The Nets, too, "pose for holy cards." The product isn't unhealthy, but there's a corporation trying to make money, distracting from more complicated issues like worker pay, the cost of tickets, leaking bass, and some sweet land deals.

Similarly, consider the feature coverage (NY1, Bleacher Report) of the Barclays Center's "cool" elevator and underground rotating turntable.

Sure, it's an innovation, but it doesn't work so perfectly. In fact, delivery trucks often idle on nearby residential streets, as noted on Atlantic Yards Watch. They must not send out the right press releases.

A long look at Marty Markowitz, from City Limits: Atlantic Yards brought out his "less admirable traits"

From City Limits' Brooklyn Bureau, How Sweet Was It? Marty Markowitz's Boro Hall Legacy, by Gail Robinson:
By some accounts, the Atlantic Yards controversy brought out Markowitz's less admirable traits: a tendency to scream, to see any criticism as a personal attack, to be vindictive. "He went from being a happy cheerleader to being a nasty guy, says Tom Angotti, a professor of urban affairs and planning at Hunter College and a critic of the project. He treated people against the project "as enemies, not citizens," [DDDB's Daniel] Goldstein says.

Now, with Barclays Center open, Markowitz clearly basks in its apparent success. His Christmas card last year was a paean to the arena—complete with reworked lyrics to "Winter Wonderland" such as "Barclays here, Streisand's belting, Fans will cheer, hearts are melting"—and he is said to be planning a giant farewell party for himself there.

...Markowitz has embraced a myriad of other projects of varying merit, including the Bloomberg administration's rezoning of downtown Brooklyn to allow for taller buildings, the Rose Plaza River Development in Williamsburg, Vito Lopez's controversial plan for the Broadway Triangle in East Williamsburg and the renovation of the Loew's Kings Theater in Flatbush. In some cases, he has advocated for more affordable housing at the projects and other amenities. At the end of the day, though, Angotti says Markowitz "has never met a project he didn't like," believing that "all growth is good growth. All projects are good projects. They bring in jobs."

Markowitz likes to trumpet his part in these projects but his exact role—even on Atlantic Yards—is a matter of debate... [ex-ACORN head Bertha] Lewis contends Markowitz left his mark on the Ratner project, helping to bring more affordable housing and apartments for seniors to the development. (Unlike the arena, that housing, has, of course, not yet been built and some of it may not materialize for 25 years.)
Of course, Markowitz has said nothing about the developer's backing off promises--promises Lewis secured--to ensure that half the subsidized units, in floor space, would go to two- and three-bedroom units.

There's lots more in the long profile, even though Markowitz didn't cooperate.

Monday, March 25, 2013

How to fill the NYPD's (alleged) summons quota, easy: crack down on vehicles in streets outside the Barclays Center

From a 3/21/13 New York Times article headlined Stop-and-Frisk Trial Turns to Claim of Arrest Quotas:
In one recording, a man identified by Officer [Adhyl] Polanco as Angel Herran, who was a delegate in the 41st Precinct at the time, could be heard trying to convince officers that it was not unreasonable to be expected to write tickets.

“You have to show something,” he said. “You’re a police officer.”

“You mean to tell me,” he asked, that during a month of work “you haven’t seen any violations on parking, any violation, and any kind of arrest?”
This is head-spinning stuff. If the NYPD truly wants to find violations, they can harvest low-hanging fruit on the streets near the Barclays Center arena around the time of events.

For months, that wasn't a priority for the 78th Precinct, though anecdotal reports suggest they have gotten tougher, for example ticketing two sedans parked in a No Standing zone on 3/21/13. That said, Atlantic Yards Watch provides a regular compendium of incidents.

Is an Arena Football League team coming to Barclays Center?

Is arena football--in which each team has eight players on a field the size of an NHL hockey rink, playing over a main surface half the length of outdoor football field--coming to Brooklyn? Well, the Arena Football League is expanding.

In the Bring the AFL to Boston blog, fan Chris Menn wrote 3/22/13:
As you may or may not know, every year the AFL commissioner gives a state of the league address where he talks about what has happened to the league such as the TV deal with CBS, the CBA settlement, and other things. What caught my eye is this little bit regarding expansion:
As we head into the 2013 season, I am as pleased as I possibly could be with our direction. We’ve got 14 markets now – and another two expansion teams on the horizon for next year –
Now as far as I know one of the two expansion markets is New York which would play in the Barclays Center in Brooklyn, NY. It'll be interesting to see which city is rewarded with the second expansion team as it would give the league an even 16 teams which works very well in the 4 division set-up the league currently has.
I haven't seen that confirmed anywhere.

Still, if the Barclays Center gets experienced in converting the floor for hockey, since the hockey Islanders are supposed to arrive in 2015 (or sooner if they break their lease with the Nassau Coliseum), arena football shouldn't be out of the question. And the Arena Football League does have a (modest) TV contract.

Sunday, March 24, 2013

The costs of the circus at the Barclays Center: ticket fees, expensive programs, and children "gasping and crying"

Prices for the Ringing Bros. and Barnum & Bailey circus at the Barclays Center may seem reasonable--they start at $24 but group tickets go for $16, and kids' tickets for weekday performances go for $12.

Oops. That's where the gouging starts. Would you believe that, at least via Ticketmaster, those $12 tickets come with $8.90 in fees, so they actually cost $20.90?

Then come the concessions.

While other Barclays Center events sell t-shirts and other souvenirs outside on the plaza, none display quite the hucksterism as displayed in the video below.

You've got to get your program now, before you go inside the building," the man at the yellow booth barks. " Each family must have a program.... They do autograph signing with the program."

Programs cost $15. (Update: this video suggests they're doing what they can to downplay mention of the $15 price. Perhaps this post had an impact.)

Inside, I'm told, the souvenirs are quite costly. But parents don't want to disappoint their kids, do they?

It's all a reminder of how Nets/arena CEO Brett Yormark famously claimed, in a December 2008 Newark Star-Ledger profile, that he'd never heard of P.T. Barnum.

A blogger's take

Most everyone loves the circus, right? This 3/20/13 review on the Brooklyn Mama's network is an interesting counter to some of the hype, especially since the reviewer did get free tickets:
Despite a $9.3 million dollar win in court last year, the circus’ treatment of animals is questionable at best. That is made even more apparent while watching the show from the 5th row of an arena where parents can clearly see how aggressively the animals are handled. That combined with the blatant gender and racial stereotypes within the performance like the exclusively African American basketball unicycle teams, and the 30 minute long “boys against girls competition” (announced as such) that involved girls dressed in pink and boys in blue, made this an “amazing” experience for all.
The highlight however, happened only 10 minutes into the show with white bunny rabbits being aggressively handled and shoved by the neck into a box with a boa constrictor. Yes, there was most surely a secondary box to protect the little bunnies, but this did not stop children in the audience from gasping and crying. The underwhelming performances, loud music, and all around poor production combined with the branded elephants, bad American Idol spinoff skit and crying children makes this a definite miss for you and your family.

EB-5 down the rabbit hole: WSJ says "reputable businesses," including Barclays Center, have used immigrant investor funding (but it wasn't the arena)

A 3/18/13 front-page Wall Street Journal article, Chinese Investors Get Picky Over U.S. Visa-for-Cash Deal:
But as the 74-year-old Mr. von Trapp has discovered, would-be investors are getting much pickier. American businesses ranging from fast-food franchises to biofuel facilities to meatpacking plants are now competing for EB-5 funds. Some projects haven't produced the requisite number of jobs—prompting U.S. immigration authorities to withhold green cards. And word has spread about investment money disappearing in failed businesses or outright frauds.

"It's much more difficult than I anticipated," says Mr. von Trapp.

U.S. authorities say they have slowed visa approval because of fraud suspicions and defects in job-creation estimates by developers. Authorities also acknowledge their reviews of those estimates have been flawed. Last year, the federal Citizenship and Immigration Services agency, which oversees the program, hired a half dozen economists to better assess the job-production claims.

...The EB-5 program was created by Congress in 1990 to help lift the economy out of recession. It attracted minimal interest from U.S. businesses until the financial crisis hit in 2008 and traditional sources of financing got harder to tap.

Since then, numerous reputable businesses, large and small, have used the program to raise money. Marriott International Inc., Hyatt Hotels Corp. Hilton Worldwide Inc. are teaming up with EB-5 investment funds to build new hotels. An EB-5 project in Los Angeles raised money for Sony Pictures Entertainment and Warner Bros. Another in Brooklyn helped fund the Barclays Center, new home of the NBA's Brooklyn Nets.
Oh? Was the Barclays Center using the program, or were builders of the Barclays Center promoting the arena to entice investors? (That's putting aside the "reputable" question.)

Contrary evidence

Business Week reported 3/23/12:
The Atlantic Yards developer, Forest City Ratner Cos., is borrowing $228 million in EB-5 money for a $1.4 billion infrastructure and arena fund that’s paying for a new subway entrance, parking facilities, municipal water and sewer line upgrades and other work in the vicinity of Barclays Center, according to Joe DePlasco, a spokesman for the company. The arena, which is being built for the National Basketball Association’s New Jersey Nets, will be an anchor of the $4.9 billion development, planned to include up to 6,430 housing units and 247,000 square feet of retail space.
In an unskeptical 9/21/10 article, Ratner Mulls Visa Financing, the Wall Street Journal nonetheless provided this important detail, one that seemed contradicted by the project's promotion in China and the evidence that later emerged:
[Forest City Ratner executive MaryAnne] Gilmartin said she expects much of the money raised through the program would go toward financing the construction of a new rail yard for the Long Island Rail Road to replace the one that occupied a large portion of the site. Some may also be used to help pay off land loans on the project, she said.
Meanwhile, the evidence suggests the money is going to loan replacement.

EB-5 coverage

For another example of how EB-5 coverage is framed, see this 3/21/13 Washington Post article, Foreign citizens making big investments in U.S. in exchange for green cards:
The EB-5 program is booming in popularity, driven largely by a struggling U.S. economy in which developers are searching for new sources of capital. It is also fueled by rising demand from foreigners looking for access to U.S. schools, safe investment in U.S. projects and — in the case of China, where most of the investors are from — greater freedom.
The program has broad bipartisan support in Congress, and key senators who are negotiating an overhaul of the immigration system have said they are leaning toward expanding visa programs that provide an immediate boost to the economy.
But others argue that the EB-5 program amounts to buying citizenship, and that it unfairly allows wealthy foreigners to cut the visa line ahead of others who have waited for years.
“I don’t think we should sell admission to the United States,” said David North of the Center for Immigration Studies, which favors reduced immigration.
Supporters call the program a no-brainer, because it creates jobs and attracts investment.
“If you get highly skilled, highly talented immigrants with money, who are paying and committing to things that are positive, I’m inclined to think it’s terrific,” former Treasury secretary Lawrence H. Summers said.
The question is: who are the winners? Evidence suggests that everyone but the public at large come first: the immigrants accepting a lower interest rate for a green card, the middlemen getting fees, and the entrepreneurs getting cheap capital to save money on their projects. 

The "job creation"--ten jobs per $500,000--need only be on paper, and indirect jobs can be counted.

Saturday, March 23, 2013

What's going on at the northeast corner of the arena block? The removal of construction trailers means...

A reader asked me what was going on with the removal of below-grade construction trailers this week at the northeast corner of the arena block.

There was no explanation, but it's safe to assume that, with the near-completion of the arena, those construction trailers were unnecessary/redundant. There are no plans yet to build on that site, aka B4.

It is slated to the the third of the modular residential buildings around the arena--first, the 32-story B2, which began construction in December at the corner of Flatbush Avenue and Dean Street, then the somewhat shorter B3 at the northwest corner of Sixth Avenue and Dean, then B4 (about 50 stories) at the southwest corner of Sixth and Atlantic Avenue.

I think it's safe to assume that the developer want to make sure they can get the first two buildings right before trying one that's much larger. B3 is supposed to start six to nine months after first is completed (which should be mid/late 2014), and third building on the same schedule, so that suggests an early 2016 start for B4. But nothing with Atlantic Yardsis predictable.

I assume the removal of the construction trailers will be discussed at a future public meeting, such as the next Atlantic Yards Quality of Life meeting, likely in late April.

For Markowitz's final State of the Borough address, an inevitable setting: the Barclays Center

It was inevitable: after holding his most recent annual State of the Borough addresses at Brooklyn College, Sunset Park High School, and the Park Slope Armory, for his final such address, on Thursday, April 11, Borough President Marty Markowitz will be at the Barclays Center arena, the most dramatic symbol of his tenure. (Attendance is invite-only.)

When he spoke previously, there was relatively light enthusiasm for the upcoming arena. This time it should be different. (After all, the arena has been winning design awards, such as this one from AIA New York.)

Then again, let's see how much people cheer for part-time jobs with no benefits.

Friday, March 22, 2013

Arena construction monitor: final completion date extended to April 30, facade issues persist

No they're not quite done yet with the arena. Nor are problems with the facade quite fixed.

According to the latest Site Observation Report by Merritt & Harris, the construction monitor for the arena bond trustee, the final completion date, listed (as it had long been) in the previous reports as 2/28/13, has now been nudged forward to 4/30/13.

Punch list work will occur on non-event days. As the screenshot at right indicates, there are 30 workers doing such punch list work.

The new report, dated 3/8/13, was released yesterday. It's based on a site visit 1/29/13, documents received 2/28/13, and an affidavit 3/8/13.

Facade issues

Despite a promise in the previous report that defective bolts would be replaced by 1/11/13, there are still open issues, as detailed in a 2/18/13 Field Observations Report from 2/18/13, including:
  • missing anchorage details
  • missing hardware
  • incompletely torqued bolts
  • skewed rod installation
It's not clear from the documents how extensive the problems are and what kind of danger they have posed.

Summary of facade issues

Examples of facade issues

A missing fastener

Construction progress: arena

(Here's last month and the previous progress charts.)

Construction progress: transit connection

At B-2 site tomorrow, a welding crew 7 am to 6 pm

According to a Supplemental Report to the two-week Atlantic Yards Construction Update, there will be work tomorrow at the site of the B-2 modular tower, at the corner of Dean Street and Flatbush Avenue:
A welding crew will be working at the B2 tower site this Saturday, March 23rd on the installation of bracing steel as part of the support of excavation system. Work will take place between 7:00am and 6:00pm. All work will be pursuant to Department of Buildings permit.
The notice does not indicate whether this is expected to be particularly noisy.

Thursday, March 21, 2013

Ringling Brothers elephants: star of the promotion and focus of the protest; also, circus operations extend arena perimeter

The Ringling Brothers & Barnum and Bailey circus arrived yesterday in Brooklyn, and the elephants were the highlight--both for circus-watchers and protesters.

First came a staged walk-through DUMBO in the morning. As NY1 reported:
To celebrate its arrival Wednesday, a parade of eight elephants and their handlers marched across Old Fulton and Old Water Streets, wowing school kids and adults who came out to see the unusual sight.
....Borough President Marty Markowitz also proclaimed it Ringling Brothers and Barnum and Bailey Circus days while they're in town.
Protesters were kept a block and a half away, according to Gothamist.

A New York Post article headlined Jumbo in dumbo cited the arena developer:
“I have been waiting for this moment for 10 years!” Barclays Center developer Bruce Ratner yelled to the crowd of bystanders that gathered, referring to the time it took to get the arena built.
An evening  protest

Before the 7 pm show, however, perhaps 150 activists from Animal Defenders International, People for the Ethical Treatment of Animals gathered at 6 pm to walk around the arena, carrying protest signs like "Built to Enslave," a parody of the show name, "Built to Amaze."

The number was somewhat more than the 100 maximum police predicted; smaller groups are expected through the end of the circus on April 1.

The treatment of elephants was key to their protest, given the use of bullhooks to guide/control/scare the bests. For a defense of the circus, see links from Ringling and industry allies. For a critique, see material from animal rights advocates and a zoo director.

The extended perimeter

Meanwhile, evidence suggests that the lengthy term of the circus requires some unusual accommodation for participants.

For example, as the photo at right from Atlantic Yards Watch shows, not only was there late night activity Tuesday night in the loading dock, there appear to be a residential trailer and generator in the "pad" next to the loading dock.

And, as other Atlantic Yards Watch photos and video show, delivery and construction trucks have both used residential streets rather than approved truck routes and idled on those streets.

In some way, the delay in building residential towers adjacent to the arena is a boon for arena operators; if there were a tower in the space immediately next to the trailer, above, some residents likely would be lodging complaints.

More from the protest

The protests

Trucks on residential Dean Street

Wednesday, March 20, 2013

At Precinct Council meeting, complaints about parking problems (not just arena-related), circus set-up, idling trucks

At the monthly meeting last night of the 78th Precinct Council, there was talk about continued problems with parking--some but hardly all related to the Barclays Center--as well as the upcoming protest tonight outside the circus, and the arena’s continuing inability to manage trucks that idle in neighborhood streets.

A church's impact

One resident pointed to a line of unbroken double parked cars, on Dean Street east of Sixth Avenue and St. Marks Avenue east of Carlton Avenue.

Deputy Inspector Michael Ameri, the commanding officer, said it’s “safe to assume it was the church,” citing the Temple of Restoration at 515 Dean Street. “It's an ongoing problem. I've met with the church several times, we're trying to be good neighbors, trying to have a delicate balance.” Apparently such diplomacy doesn’t quite work, so he said he’d make another visit.

Robert Puca, a resident of the Newswalk building nearby, said he now was seeking street parking because his building’s garage raised its price in the wake of arena patrons. “The people who live here don't get the same break that they're getting,” he observed, citing the need sometimes to extract a car from a double-parked vehicle attending the church.

“I hear you loud and clear,” America said, noting that while the police department extended the church a courtesy, “every once and a while I have to bring them back to reality.”

Puca, noting that the north side of Pacific Street lost parking as part of railyard work, stated, “I don't know if there is a solution.” Along with the demand from neighbors and the church, of course, some fraction of arenagoers seek free parking on the streets.

What about the police?

Also, after expressing respect for the police, Puca pointed to ongoing problems caused by the police themselves--”the constant parking on the sidewalk... you have the vans literally backed up on the sidewalk” of Bergen Street near Sixth Avenue.

“It’s a fair point,” Ameri said. “I'm going to revisit the issue.”

Puca asked if police and fire personnel have assigned spots at the arena parking lot.

“We have 24 spots on [Block] 1129,” Ameri responded. “They're utilized, probably being underutilized... I'll have to get back on top of the guys, once in a while it needs to be brought to my attention.”

Peter Krashes of the Dean Street block association warned that the situation would worsen when residential buildings, and attendant pedestrians, are built around the arena block.

Truck Route warning?

Krahses noted that the “No Truck Route” sign that had been requested for the corner of Dean Street and Sixth Avenue has been delayed.

“I hate to pass the buck,” Ameri said, but “it's a DOT [Department of Transportation] issue.. but I would like to see it posted as well.”

Derek Lynch of Empire State Development, the state agency overseeing Atlantic Yards, said he’d try to push the issue.

The circus

Krashes reported multiple incidents in which trucks delivering materials for the circus were parking in the Dean Street bus stop or no standing zones. “Every truck today was idling,” he said, “ I know it's a nonemergency response and hate to distract you from your business, but it would be much appreciated if the arena did the job they were supposed to do.”

“Please, call 311 so it's brought to my attention,” Ameri responded. “I encourage you to help me put pressure on the Barclays Center at the next [Atlantic Yards] Quality of Life meeting... Their loading dock manager has been told about managing these trucks.” (The next meeting should be in late April.)

Though reports on Facebook suggested that there would be as many as 400 protesters outside the circus opening tonight, Ameri said such numbers are likely overblown, predicting between 25 and 100 people, but “we always prepare for the worst.” Protesters will be staged on Flatbush across from the arena, in front of Modell's and the Brooklyn Bear's Garden.

As to Krashes’s question about whether pre- or post-event times are the worst for sidewalk congestion, Ameri pointed out--as seems obvious--that people arrive at the arena intermittently but there’s a “mass exodus” afterward. “Sidewalks are definitely more congested upon the conclusion of an event.”

Public urination

Pauline Blake, president of the Precinct Council, asked about people coming from arena using side streets for public urination.

“I monitor 311, I don't see too many urination complaints,” said Ameri, noting that Pacific Street west of the arena have been tamped down due to the presence of an officer. There have been “some issues” outside the Newswalk parking garage, he allowed.

Blake reported an incident on Bergen Street between Fourth and Fifth avenues.

“I haven't seen much of an uptake,” Ameri said, noting that the main issue “really is parking.”