Downtown Brooklyn Development

[zinka]

Some details on City Point construction phasing, from the Community Board 2 meeting last night:

They have signed an agreement with EDC to split the project into 4 phases. The phases proceed in order from Fulton St towards Willoughby St. They are required to start construction on the Fulton St end by March 2010.

Phase 1A: at least 40k SF of retail/commercial. Construction 3/10-3/12.
Phase 1B: 82-144k SF of retail/commercial, 170-210k SF commercial (I think; my notes are unclear here), construction 3/11-3/14.
Phase 2A: 500k SF, construction 6/14-6/17.
Phase 2B: the balance of the construction on the site. The aggregate amount of all four phases must be between 1375-1587k SF. A residential tower is likely in phase 2B. Construction 6/17-6/20.



There was also a small update on Willoughby Square Park(ing garage). Currently the city is relocating residential and commercial tenants. Once that is done, the development will proceed.

[antinimby]

It will take them until 2020 to finish? That's outrageous, considering they're one of the few projects getting Stimulus money.

[zinka]

It's not ideal, but I don't think it's totally unreasonable given the size of the site and the glut of apartments on that part of Flatbush. Hopefully by 2020 all the other buildings will be absorbed!

The stimulus money is a loan, not a grant. They have to repay it.

[BrooklynLove]

Zinka - thanks for sharing that info. By the way, construction in your favorite location is clipping along nicely w/o any stim.

[antinimby]

zinka, IT IS totally unreasonable. Do you even know what you are saying?

2020 is as far away from today as we are right now from 1998!

Imagine projects that were finished back in 1998 that took until today to completely sell/rent out. If that isn't the very definition of unreasonable, I don't know what is.

As for the Stimulus money being a loan and not a grant. That's hilarious.

Did you want the taxpayer/Federal government to build this project for the developers, too?

Very few developers are able to get construction loans anymore, that Stimulus "loan" is a gift a ton of developers would kill for right now.

[Tectonic]

It does sound insane.

[BrooklynRider]

I believe the stimulus funds were to allow the project to proceed with the Phase 1a and 1b of the project - only.

Without that lot even partially developed, selling down Brooklyn as a business district / city hub of the future becomes very difficult. It is a centerpiece of the Redevelopment Planning.

[Merry]

City Point Phase 1 Heads to Public Design Commission

Construction Expected to Begin in Spring

by Linda Collins

DOWNTOWN BROOKLYN — The first phase of the proposed City Point/Albee Square development in Downtown Brooklyn goes to the city’s Public Design Commission next week, according to a report made to Community Board 2 (CB 2) by the NYC Economic Development Corp. (EDC) last week. That phase, Phase 1A, covers the retail part of the development, according to Janel Patterson, an EDC spokesperson.

“We met with CB 2 to briefly update them on the City Point project,” she said. “The project will be presented to the Public Design Commission next week.”

CB2 board members were also told that in Phase 1A there will be a mix of national and local retail. Additionally, the developer has agreed to offer former Albee Square tenants space before broadly marketing the space, according to Patterson.

“The goal of the CityPoint project is to build on and enhance the vibrancy of the already successful Fulton Street corridor, not to make dramatic changes to the character and makeup of the neighborhood,” she added.
Construction on Phase 1A is expected to begin in the first quarter of 2010.
This was confirmed by Tom Montvel-Cohen, a consultant and spokesperson for developer Albee Development LLC, who was present at the CB2 meeting.

Albee Development is an umbrella organization for several developers involved in aspects of the project, including Acadia Realty Trust, P/A Associates and MacFarlane Partners.

“It’s in the Public Design Commission stage,” Montvel-Cohen told the Eagle, adding, “We cannot release a rendering before it goes to the Design Commission.

As reported in August, City Point — then identified as “a stalled construction site” — was selected by the EDC to receive $20 million in “triple-tax exempt bonds” from the federal stimulus program. The EDC said at the time the program was designed by Congress and the Obama administration specifically to restart construction projects that were stalled.

Also in August, Montvel-Cohen described the first phase as a tower with between three and four floors of retail, and between 12 and 13 stories of residential above them.

The approximately 240 residential units will be a 50-30-20 split between market rate, middle-income and low-income housing, with the breakdown at 120, 72 and 48 units, respectively. Additionally, of the 48 reserved for low-income tenants, 20 percent will be reserved for the very low income.

“We made the decision to put all of the affordable units in the first phase,” he said. “So this is actually an acceleration of the affordable housing element.”

Montvel-Cohen continued, “We’ve been working very hard to move this project forward and we’re pleased that we can begin it soon and we’re very pleased that we can deliver the affordable element in the first phase.”

Originally planned to be a major 65-story tower, the City Point project appears to be scaled down quite a bit, if this 16- or 17-story first phase is any indication.

He confirmed that the project can move forward once the design — by the architectural firms Greenberg Farrow and Cook + Fox — is approved by the city’s Design Commission, which must review all permanent works of architecture (as well as landscape architecture and art) proposed for city-owned property.

http://www.brooklyneagle.com/categor..._id=5&id=31490

[BrooklynRider]

October 29, 2009

Development, Engine of Bloomberg’s Plan, Stalled in Downturn

By RUSS BUETTNER and RAY RIVERA

Over the past seven years, Mayor Michael R. Bloomberg has presided over a historic re-envisioning of New York City, one that loosened the reins on development across the boroughs and pushed 99 rezoning measures through a City Council that stamped them all into law.

His administration poured $16 billion into financing to foster commercial development and affordable housing and created quasi-local organizations to promote its initiatives and blunt neighborhood opposition.

And when the economy was burning white hot, as it did for several years, the mayor’s plan appeared to be both bold and forward-looking, a prescient decision to remake portions of the city in order to lure companies, create jobs and increase economic vitality.

But that vitality is missing in some sections of New York today, where developments spurred in part by easy credit and in part by city initiatives are now stalled or in danger of collapse.

No question, the upheaval in the real estate world was primarily caused by a recession that Mr. Bloomberg had no role in starting and no power to stop. But Mr. Bloomberg has campaigned as a business visionary, better suited than most to lead in tough times, and any review of his term needs to confront his embrace of development as a stimulus tool.

Administration officials say their development initiatives created jobs and housing and revitalized moribund areas, like downtown Jamaica, Queens. Across the city, residential construction doubled under Mr. Bloomberg, to more than 30,000 units a year from 2004 through 2008, before slowing this year.

Construction spending has also doubled since he took office, reaching a high of $32 billion in 2008, according to the New York City Building Congress. The organization projects a 20 percent drop this year.

And if the skyline seems little changed despite the rezoning of some 8,400 blocks, the impact can still be seen in old, outlying factory neighborhoods where new housing has risen, or in places like Flushing, Queens, and the Bronx, where signature new baseball stadiums were built.

But things have not gone according to plan in neighborhoods like Downtown Brooklyn, which was rezoned to foster development of new office towers to compete with New Jersey. None have gone up and other projects have stalled. Developers knocked down a shopping mall to make way for the grand City Point development: new apartments, a retail boulevard, a tower of commercial space. It has yet to materialize.

Daniel L. Doctoroff, who served as Mr. Bloomberg’s deputy mayor for economic development, said it was naïve to view the initiatives in the short term.

“It’s always tempting to sit there and say, ‘Here we are, we’re at the depth of a recession, and therefore, look at all this stuff, it didn’t make sense,’ ” he said. “That is the kind of thinking that has proven time and time again to be completely fallacious when you look at New York City history.”

Ron Shiffman, a former city planning commissioner, said a flaw in the mayor’s approach was its failure to do enough to reap public benefits from a real estate industry he had so readily fostered.

“He didn’t steer the boom,” Mr. Shiffman said. “He did not direct it in such a way that it benefited a more diverse set of populations in the city of New York, and more diverse income groups. It was basically developer-driven.”

Remapping The Future

The administration’s economic development policies started with a simple concept: New York must grow to compete with other cities.

Development became the means toward that end. Create incentives for developers, the wisdom held, and good things will happen for New York as a whole. Companies will rush to glorious new towers in reinvented neighborhoods, diversifying the city’s economy in the process.

Many mayors have favored the real estate industry, whose campaign contributions are often generous. Mr. Bloomberg lobbied forcefully for developers even though he did not need their money.

“I think a mistake that mayors have made,” said Seth W. Pinsky, executive director of the city’s Economic Development Corporation, “is that they’ve really only been willing to push projects where they would be around to cut the ribbon to open the project, and what this mayor has done is to take the long-term view.”

The first obstacle to remaking the city was the lack of available swaths for large-scale development. Rezoning became the solution, Mr. Doctoroff said. He had headed the committee that sought to bring the Olympics to the city and had become familiar with largely undeveloped tracts outside the Manhattan core, like sites along the Brooklyn waterfront.

“That sort of became the genesis for the effort,” he said in a 2007 interview.

The effort became the most extensive rezoning in modern city history. Much of the land was rezoned to boost its development potential. Fallow factory sites were recast as places for housing or office towers as the city confronted the idea that it was no longer a manufacturing center. In other cases, the city reduced allowable densities in neighborhoods troubled by illegal or unpopular development.

The City Council adopted every rezoning without major revision. So far, one-fifth of the city has been rezoned.

The development zeal was driven by a projection that the city’s population would grow by one million by 2030. The projection, by city planners, was based on many assumptions, some of them overly optimistic, said Andrew A. Beveridge, a demographer and professor at Queens College. But the forecast became a central rationale for encouraging a building boom.

The city hired two consulting firms at a cost of more than $1.5 million to explore how the extra people could be accommodated. Drawing from that work, the administration created its vision for the future, known as PlaNYC, which was released by the mayor on Earth Day 2007 and included a host of environmental initiatives, like planting one million trees.

“Let’s face up to the fact that our population growth is putting our city on a collision course with the environment, which itself is growing more unstable and uncertain,” Mr. Bloomberg said in releasing the plan. “To accommodate nearly a million more New Yorkers, we are going to have to create hundreds of thousands of new homes.”

Seeding Progress

New York City has frequently used money to spur development. Under Mr. Bloomberg, the city drastically increased the low-cost financing it made available to developers, in part because Mr. Doctoroff, a former investment banker, recognized the unrealized potential in some of the city’s balance sheets.

Most of the infusion cost little or nothing to taxpayers. It came in the form of low-interest loans to developers, with money raised by issuing bonds.

The Housing Development Corporation, for example, a public benefit corporation intended to foster affordable-housing construction, has issued $8.1 billion in bonds to support development under Mr. Bloomberg, more than triple the total issued let during the Giuliani administration.

Another quasi-public agency, the Industrial Development Agency, has authorized more than $6.1 billion in new debt since Mr. Bloomberg took office — about 50 percent more than during Mr. Giuliani’s tenure. The largest pieces of that package helped finance new baseball stadiums for the Yankees and the Mets.

The figures for both agencies do not include Liberty Bonds, which were part of the 9/11 federal aid package.

Legally, the city is not responsible for debt incurred by its public benefit corporations, even if the underlying projects fail or stall. But officials said the city may feel compelled to help bondholders so as to protect the ratings on its other bonds.

“For all practical purposes, if H.D.C. went belly-up, there would be some expectation of the city making good on it,” said Doug Turetsky, a spokesman for the city’s nonpartisan Independent Budget Office.
At times, urban planners have questioned whether the Bloomberg administration has gone overboard in offering incentives to developers.

The Hudson Yards on Manhattan’s West Side have been looked at successively as a potential Olympic venue, a football stadium and now an urban village. And the city, through a specially created authority, has issued $2.1 billion in debt to pay for the extension of the No. 7 subway line to the area.

The debt is supposed to be paid from taxes generated by the new development, but if no development occurs, the city could be on the hook for $100 million a year in payments.

A 2007 report by the New York City Bar Association said the Yards financing scheme “bears an eerie resemblance to the development of Battery Park City,” which nearly defaulted and helped plunge the city into a fiscal crisis in the 1970s. And, it asked, if development of the West Side is inevitable, “why should costly artificial economic incentives be offered to encourage that development?”

Bloomberg officials say that much of their lending was done to build or preserve 165,000 units of what the administration considers to be affordable housing, an ambitious plan for which the mayor has received many accolades. They point to vastly reinvented areas outside of Manhattan’s wealthy core, like the Melrose section of the Bronx, where city financing underwrote new housing developments.

But some of the housing has been for families earning more than $100,000 a year, and some of the income limits expire after 15 years. H.D.C. has also provided hundreds of millions of dollars in financing that, in the view of advocates for moderately priced housing, subsidized market-rate apartments because the developers enjoyed outsize savings in exchange for a small number of lower-income units.

Marc Jahr, president of the Housing Development Corporation, said most of the agency’s financing — half of the 43,000 apartments that the corporation has financed through the mayor’s affordable housing program — had been for housing for people who earned 60 percent or less of the area’s median income.

“We think that’s a good, balanced housing plan,” he said, “and one that’s important to the neighborhoods and important to the city to sustain over time.”

Some housing advocates say the gain in moderately priced housing units has been offset by the loss of 200,000 apartments that switched back to market rates under state rent-regulation laws that, they say, Mr. Bloomberg did not push Albany to change.

“Everyone will admit that New York City can’t build its way out of its affordable housing crisis,” said Mario Mazzoni, lead organizer at the Metropolitan Council on Housing, a tenants’ rights organization. “If you are talking about building affordable housing, the way they conceive of it is as a massive subsidy to developers.”

Grass Roots

Redevelopment can look easy on paper, but there are always neighborhood concerns, even in a place like Willets Point, a 62-acre industrial shanty town of body shops and scrap yards near Shea Stadium in Queens. The administration viewed it as an area ripe for economic development if the 225 existing businesses could be cleared.

But such ambitions had flummoxed city planners for decades.

No less a builder than Robert Moses had been unable to make room in the area for the 1964 World’s Fair.

Mr. Doctoroff was determined to do better. In 2006 he enlisted the help of Claire Shulman, who had been Queens borough president and had long thought the area had potential as a business, retail and transit hub. She enlisted local business leaders who supported the idea: Queens people fighting to re-envision Queens.

In reality, though, the organization, the Flushing-Willets Point Local Development Corporation, received half its money from the city. And about half the group’s money was spent doing something not allowed under state law: lobbying city officials. The City Council adopted the Bloomberg plan last fall, citing Mrs. Shulman’s efforts.

The group’s lobbying, has led to an investigation by the attorney general’s office. City officials have said they never authorized Mrs. Shulman’s lobbying, which she has disputed.

That investigation has expanded into the activities of the Downtown Brooklyn Partnership, which the city helped create in 2006 to help push through development plans initiated two years earlier with a broad rezoning of the area.

The city awarded the group a $6 million, three-year, no-bid contract. The group raised another $1.1 million in private donations, tax records show. And Mr. Doctoroff installed a top aide, Joe Chan, to run it.

“His job was to push everything in Downtown Brooklyn along,” Mr. Doctoroff said in the 2007 interview.

The partnership has become a key voice for the development of Downtown Brooklyn, inserting itself, critics say, into the debate over a plan to build a Nets area and high-rises at the Atlantic Yards. It has spent some $200,000 on lobbying expenses. Councilman Lewis A. Fidler complained last year that the partnership was using public funds to promote Bloomberg’s congestion-pricing plan.

Citing the investigation, city officials declined to discuss the Brooklyn group’s lobbying, as did Mr. Chan.

Arrested Development

For years, Downtown Brooklyn resembled the textbook definition of back-office space. Class B. Schleppy. No buzz.

Even after the MetroTech development began to emerge in the 1980s, and with it major corporations like Chase and KeySpan, the core commercial district excited few people.

In 2004, sparked by a push from local business leaders, the city rezoned 22 blocks there. The new zoning anticipated 4.5 million square feet of office and commercial space that might keep businesses from moving to New Jersey, plus 1,000 new apartments. There were hopes for 18,500 new office jobs and 8,000 construction jobs.

Today, much of this future remains unrealized. There are no new office towers. Luxury apartment buildings went up, but many units remain unsold and retail space is unrented, victims of the downturn and a glut created by new construction.

“It seems like a lot of places the attitude has been like a field of dreams: If you zone it, they will come,” said Robert Perris, district manager of Brooklyn Community Board 2, whose district includes MetroTech. “It’s been kind of a mixed bag here.”

Indeed, companies like Bear Stearns have disappeared. Others, like JPMorgan Chase & Company, have downsized their Brooklyn operations. New condo buildings are becoming rentals. Prices are being cut. Several planned projects are stalled as empty lots. Across the city, officials say, the recession has contributed to the stopping of work at about 450 projects.

James Whelan, the former head of the Downtown Brooklyn Council, which created the rezoning plan, sees the new residential development, especially along Flatbush Avenue, which developers once ignored, as an early sign of success. “Is there a commercial office tower built as part of the Downtown Brooklyn plan as we sit here today?” Mr. Whelan said. “No. When is it going to be built? It’s not clear. But you know development is a long-term issue in New York City.”

A similar predicament is evident in Greenpoint and Williamsburg, two old industrial, waterfront neighborhoods in Brooklyn. A 2005 rezoning set off speculation that sent land prices rising to Manhattan levels. Gleaming glass-and-steel structures went up. Now many of them are nearly empty. Other projects foundered on shaky financing structures.

Some urban policy experts say the city did not do enough to attract concessions from developers for things like enhancing the subway service to that section of Brooklyn, which was already overcrowded.

Now the administration, which rejects that view, is working to rescue struggling projects. The long-stalled City Point development is to get $20 million in recovery bonds.

In July, when scores of other new condominiums were not selling, and developers risked default, Mr. Bloomberg and the Council stepped in to announce a $20 million pilot program to buy the empty units and use them as affordable housing.

“Private developments that sit vacant or unfinished could have a destabilizing effect on our neighborhoods, but we’re not about to let that happen,” said Mr. Bloomberg.

Actually, Mr. Bloomberg most likely fostered some of the real estate speculation with policies that invited development. But even those who say the mayor’s development record is mixed credit him for taking a long view.

“For good or bad, the rezonings will probably be his most significant development legacy,” said Jonathan Bowles, director of the Center for an Urban Future, an independent research group. “They’ve never got as much attention as the large-scale development projects he was pushing, like the Olympic stadium, but the rezonings are what will ultimately transform a large chunk of the city. Developers will be rebuilding on these for years to come.”

Copyright 2009 The New York Times Company

[BrooklynRider]

1. LIRR Station finally has the scaffolding coming down...



2. Ooh-Aah, a fancy illuminated crown over the entrance and a clock being installed.

[BrooklynRider]

Sheraton and Aloft at street level...



and in the sky...



_______________________________________________

Avalon Fort Greene - the upper floors are nearing completion...



Hulking mass of a thing...

[BrooklynRider]

November 9, 2009, 6:05 pm

Five Development Projects to Receive Stimulus Money

By Patrick McGeehan City officials have chosen five more development projects, one in each borough, to receive tax-free financing through the federal stimulus program.

The five projects, which include a hotel, a medical facility and a cement depot, would receive up to $87 million by selling “recovery bonds” through the city’s Capital Resource Corporation. City officials estimate that the projects would create about 600 construction jobs and about 300 permanent jobs, said David Lombino, a spokesman for the city’s Economic Development Corporation.

One of the chosen projects is a 117-room hotel to be built on the former site of the Pepper & Potter car dealership on Flatbush Avenue in downtown Brooklyn, which would borrow $20 million. That project was passed over in September, when the first recovery bonds were approved for the City Point apartment and shopping complex in downtown Brooklyn and another shopping center on Rockaway Peninsula in Queens.

Those projects received a combined $36 million in financing, which left the city with about $90 million in additional borrowing capacity through the stimulus program. Of the $87 million approved, the biggest piece — up to $28 million — would go to a terminal and pier on Staten Island that would receive imports of cement by ship for distribution around the city.

An additional $19.8 million would help finance a parking deck at St. Barnabas Hospital in the Bronx. Up to $17 million of bonds would be issued on behalf of Fleet Financial Group, which plans to build North Queens Medical Center, an 80,000-square-foot treatment facility with a parking garage on Union Street in Flushing. The last $2.2 million would go to My Image Studios for outfitting an arts and entertainment studio in the Kalahari Condominium on West 116th Street in Harlem.

Construction on each of the projects must get under way by the end of next year or the developers could lose the financing, under the rules of the stimulus program, Mr. Lombino said.

“There is no significant construction lending taking place right now,” he said. “But for this program, these projects wouldn’t go forward.”

[BrooklynLove]

This is good news. Building should get finished shortly now and new owner should be able to drop prices to where they need to be in order to move inventory. I suspect that this fund will be able to find some bulk buyers.

http://blogs.wsj.com/developments/20...mod=realestate

NOVEMBER 11, 2009, 10:52 AM ET
Brooklyn Condo Scooped Up by German Investors, via Atlanta

By Christina S.N. Lewis

Condo vultures have landed in Brooklyn.

Jamestown Properties, an Atlanta investment firm backed by German investors, has bought a mostly completed luxury high-rise condominium in downtown Brooklyn, N.Y., for an undisclosed sum.

The 246-unit condo, named be@Schermerhorn, was the fourth branded condominium project from SDS Procida Development Group, headed by Louis Greco and Mario Procida. The developer didn’t return a call for comment. SDS will continue to manage the property, according to Jamestown.

“We think some of the best opportunities right now are in distressed residential and hotel,” said Matt M. Bronfman, a Jamestown managing director. The firm has raised about $430 million for its fifth opportunity investment fund, which will focus on core markets with good transportation and a high barrier to entry.

Jamestown has been one of the real-estate world’s better market timers. In 2006, the firm sold News Corp.’s Manhattan headquarters for $1.55 billion to Beacon Capital Partners. It paid roughly $565 million for it in 2000, according to a person familiar with the deal.

[Mitch Warner]

Hi, I saw this article indicating that Avalon was going to start letting people move in yesterday: http://curbed.com/archives/2009/11/0..._two_weeks.php

But I walked past there several times this weekend (live in the neighborhood) and didn't see even the faintest signs of anyone moving in. Does anyone know when the building is actually planning to open?