Twenty years ago to the day, a developer unveiled a $2.5 billion vision for what he hoped would be Brooklyn’s most celebrated project since its eponymous bridge opened in 1883. To mark the anniversary, however, no one cut a ribbon, posed with a shovel or even raised a toast.
Instead, the project’s senior lender quietly filed paperwork to begin foreclosure proceedings.
The fanfare of Atlantic Yards’ launch is a distant memory now. On Dec. 10, 2003, developer Bruce Ratner assembled a star-studded team at Brooklyn Borough Hall to drum up excitement about the project. Renowned architect Frank Gehry and Brooklyn-born stars Jay-Z and former New York Knicks forward Bernard King were on hand.
Ratner was vying to buy the New Jersey Nets and move the team to a glassy new home he would build in Prospect Heights, to be designed by Gehry. Uniquely shaped office towers and apartment buildings would rise around it, covering the rail yard from which the development was named. “The Brooklyn project will not disappoint wow-seekers,” the New York Times architecture critic wrote, oblivious to the pitfalls ahead.
Ratner’s bid for the Nets — which developer Charles Kushner and then-New Jersey Sen. John Corzine were also trying to buy — hinged on building an arena that would be bolstered by profitable office and residential components surrounding it. The rail yard had to remain active during construction, and his firm, Forest City Ratner, would have to buy out the site’s many private owners.
Ratner had developed the nearby MetroTech office complex, but Atlantic Yards was orders of magnitude more complicated. At the announcement, he sought to assure that he could get it done.
“We are real,” he said. “This is going to happen.”
Two decades later, that is looking more doubtful than ever.
Some of Ratner’s original vision has materialized. A lot hasn’t.
The arena, Barclays Center, opened in 2012, but not with Gehry’s elaborate design, which was deemed too expensive. The architect was fired as master planner of the project at-large as well. Forest City scrapped the project’s signature tower, initially dubbed Miss Brooklyn, and later bailed out of Atlantic Yards entirely, selling the development rights to Greenland USA. Ratner’s firm is now defunct, and he has disappeared from the real estate scene.
Greenland, a subsidiary of a Shanghai-based conglomerate, rebranded the project Pacific Park, sold some pieces to other developers, and is struggling to hold onto what it kept. The expected cost has doubled, to $5 billion.
From the outset, the project encountered one problem after another, with each one chipping away at its viability. Local opposition and lawsuits caused years of delays, and then the Financial Crisis hit. An attempt at modular construction went awry. Forest City Ratner dissolved, Greenland ran into headwinds in China, the pandemic came and interest rates soared.
Nine of the planned 15 buildings are complete, but the remainder of the project is in jeopardy. Greenland defaulted on $350 million worth of loans tied to six development sites. Finding builders and lenders for them is complicated by a 2014 agreement requiring 876 affordable apartments be built by 2025. Missing it — a near certainty — could trigger millions of dollars in penalties.
Current and former elected officials, as well as sources familiar with the project, have long been skeptical that Greenland could complete it, given the financial woes of its parent company in China and the cost of constructing a platform over the rail yard.
“I’d be shocked if there aren’t other developers that come in to finish the job,” one source familiar with the project said. “It’s a lot for any one company.”
The situation raises bigger questions about promises made by developers, notably whether the government will hold companies to those pledges or rescue projects with public dollars.
“There are other state-led projects that would be threatened,” said Brooklyn Borough President Antonio Reynoso. “All these commitments can be broken, because they were broken at Atlantic Yards.”
The megadevelopment faced immediate opposition. At the time of Ratner’s press conference, then-Council member Letitia James called it a “land grab by a powerful developer.” Community groups railed against the idea of displacing residents to remove “blight” by building an arena and towers.
Ratner bought the Nets for $300 million in 2004. Two years later, the state signed off on Forest City’s plans for the arena and at least 4,500 apartments. Empowered by eminent domain, the state planned to assemble the project sites and lease them to the developer through long-term agreements. It would override the city’s zoning — circumventing James, the local Council member — through a general project plan.
Opponents sued, accusing the developer and state of abusing eminent domain to take over 97 lots for the 22-acre project. The case hinged on whether the project site met the legal definition of “blighted.”
In the spring of 2009, the developer scaled down plans for the gleaming office tower Miss Brooklyn, swapping it for a shorter design that journalists compared to precariously stacked Jenga pieces. Citing the ligation, slowing economy and rising construction costs, Ratner dropped Gehry.
“They ran into a buzzsaw of an economic downturn,” recalled Marty Markowitz, who as Brooklyn borough president was the project’s biggest supporter. Still pained by the Dodgers’ leaving Brooklyn in 1957, he had prompted Ratner to buy the Nets and give the borough its first major franchise since then.
“You have to understand where Brooklyn was,” he said. “It was a pit. It was a railroad pit.”
That was literally the case for the MTA’s Atlantic Yards, eight tracks in a deep cavity between Pacific Street and Atlantic, Carlton and Vanderbilt avenues. A chain link fence rings the sunken land.
Forest City shelled out untold millions to buy out property owners on the adjacent parcels, which included healthy if undersized co-ops, while the state pursued its eminent domain case. By November 2009, the state’s highest court had paved the way for the developer to take over homes and businesses at the site.
The following April, the final holdout, Daniel Goldstein, accepted $3 million from Forest City for his Pacific Street apartment. Most of it reportedly went to the legal bills his opposition group, Develop Don’t Destroy Brooklyn, had rung up. A month later, Ratner sold the Nets to Russian billionaire Mikhail Prokohorov.
Jay-Z christened the arena, designed by SHoP Architects, with eight sold-out shows. Ratner stepped down as Forest City’s CEO in January 2013, tapping MaryAnne Gilmartin as his successor.
She started on a high note because the traffic nightmare that opponents predicted at Flatbush, Atlantic and Fourth avenues had not happened. Gilmartin said she and others at Forest City felt “victorious” during opening week when Flatbush Avenue “didn’t sink into a traffic hole.”
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