Wednesday, October 05, 2005

 

The headline we haven't seen: Brooklyn Arena Would Be Most Expensive Ever

The Brooklyn Arena that would be built as part of Forest City Ratner's Atlantic Yards project would be, by far, the most expensive arena ever, at $555.3 million. However, the rest of the $3.5 billion development would cost five times as much, so that's overshadowed the arena angle.

But imagine a standalone arena. Wouldn't the cost generate some news coverage? Wouldn't reporters be asking Ratner and public officials why the arena would cost so much?

[Update 12/11/05: Note that originally I thought the Gotham Gazette entry was the first mention.]

This happened once, as far as I can tell. A 4/8/04 Daily News article headlined Nets arena cost: 500M, made the point after the headline:
Developer Bruce Ratner plans to spend more than $500 million on a new arena for the Brooklyn Nets, making it the most expensive home court in NBA history, sources said.
"It will cost about $500 million and change," a source familiar with the project told the Daily News.
That would be more than twice the average cost of the eight NBA arenas built since 1999, and would easily surpass the $375 million Staples Center in Los Angeles.
Ratner lieutenant Bruce Bender neither confirmed nor denied the half-billion-dollar figure. But he noted the arena is being designed by celebrated architect Frank Gehry, and "it's going to be done right." He said Gehry also has been told to explore expanding the arena's capacity, to create more lower-priced seats. The arena, to be built at Atlantic and Flatbush Aves., originally was designed to seat 19,000.


After that, the next mention of the arena's outsize cost came in Gotham Gazette, which on 5/2/05 declared that the arena, along with other sports facilities planned, would be by far the most expensive ever built. They depend on large subsidies by the taxpaying public.

Subsequently, the New York Sun, in a 5/20/05 article headlined "Ratner Delivers on Affordable Housing," quoted Develop Don't Destroy Brooklyn spokesman Daniel Goldstein: "A small bone of 'affordable' housing thrown to Brooklynites is far from enough to make Ratner's plan acceptable," he said. "Ratner is demanding that the public waste its money on the most expensive sports arena ever proposed, huge skyscrapers in a low-rise community."

The next mention of the arena cost came as an aside in the Independent Budget Office's fiscal brief issued in early September, titled "Atlantic Yards: A Net Fiscal Benefit for the City?" The first mention of the cost came here: If the PILOT is too small to cover debt service on the full $555.3 million cost of construction, taxable bonds will be sold to cover the difference and FCRC will pay the debt service on these taxable bonds.

Soon afterward, the Times reported the cost of the arena as a secondary issue in its 9/7/05 article headlined Offer Is Doubled by Developer to Build Arena in Brooklyn: The $555.3 million arena, which would be a new home for the Nets and the most expensive arena in the country, is one element of a $3.5 billion development of 6,000 apartments as well as stores, office space and parks that would transform the area.

Back in May, the projected cost of the arena was $435 million, at least according to the Gotham Gazette (that Daily News story a year earlier already said $500 million). Now the projected cost of $555.3 million represents an increase of more than 27.5%. Surely that's a significant change.

 

The Brooklyn Papers asks Ratner about the privatized space: no response

In an article headlined Ratner to bar public from promised park, the Brooklyn Papers took off from my previous blog posting about the space on top of the planned arena, once promised as public, now projected as private.

The article noted: Forest City Ratner did not return repeated calls for comment.

Well, someone has to explain. Brooklyn Borough President Marty Markowitz? Mayor Mike Bloomberg? If public money is going to this project, then the developer must be accountable.

Tuesday, October 04, 2005

 

New Newark arena undercuts Ratner's economic projections

Sports economist Andrew Zimbalist, a consultant hired by Forest City Ratner to provide economic projections for the Atlantic Yards project, based his projections in part on no new arena in Newark. His 2005 report states:
Many of the numbers used in this report concerning Nets attendance, ticket prices, construction costs and other items come from projections done by or for the Nets. I have discussed these estimates with the Nets and they seem reasonable to me. The Nets project that the arena will not host an NHL team and that it will host 226 events during the year (assuming the eventual closing of CAA, no new arena in Newark, no NHL and no minor league hockey events at the Atlantic Yards arena.) The Nets project out three scenarios over time based on aggressive, moderate and conservative assumptions. I use the estimates from their moderate scenario. (Emphasis added.)

Except it looks like there will be an arena in Newark. In a 10/4/05 article headlined This Time, Newark Leaders Say, the Arena Will Be Built, the Times reported: In what officials insisted was the last of several ceremonies over the last seven years trumpeting the construction of a professional sports arena in New Jersey, Newark broke ground on Monday on a $310 million building that will be the home of the New Jersey Devils at the start of the 2007-8 hockey season.

ALso, the article curiously (and carelessly) claimed that the Nets had already left for Brooklyn:
The arena plan has surmounted numerous obstacles. The State Legislature, dominated by suburban lawmakers, declined to provide money for the project. The New Jersey Nets, which were to share the arena, departed for Brooklyn, and the group that owned both teams broke up.

Remember, the arena wouldn't open until 2009 at the earliest--and that's not counting the inevitable litigation.

This page is powered by Blogger. Isn't yours?