Regional Plan Association criticizes new MTA agreement on Atlantic Yards

The board of the Metropolitan Transportation Authority voted 10 to 2 Wednesday to give Forest City Ratner 21 years to pay it $100 million for the rights to develop its Atlantic Yards site in Brooklyn rather than insisting upon a lump-sum payment.

The agreement also permits the developer to build a more modest plan and delay building about 2,250 units of moderate- and middle-income housing and creating eight acres of open space.

The developer recently disclosed that Frank O. Gehry's design has been discarded and replaced by a less flamboyant and dramatic one by Ellerbe Becket, shown in the illustration, a move that reportedly will save the developer $200 million in the costs for a basketball arena that is meant to be the centerpiece of the development.

An article in Wednesday's edition of The New York Times by Charles V. Bagli said that Bruce C. Ratner, the developer needs to raise "more than $500 million over the next four months to build the $4.9 billion project's centerpiece: the most expensive basketball arena in the country...in order to qualify for tax-exempt status."

"If he fails to meet the Dec. 31 deadline," the article continued, "Mr. Ratner would have a short grace period to secure more expensive conventional financing, but most officials and bankers say that that is unlikely given the still frozen state of the credit markets. Atlantic Yards could collapse if that happens. 'In the event they are unable to secure financing under those terms,' said Gary Dellaverson, chief financial officer for the Metropolitan Transportation Authority, 'the agreement is no longer valid and the M.T.A. would have to decide what to do with the property.' Mr. Ratner and his bond underwriters -- Goldman Sachs and Barclays Capital -- expressed confidence in the project and their ability to sell the tax-exempt bonds for the arena (to be known as the Barclays Center), much as the Yankees and the Mets did for their new stadiums. On Tuesday, the Empire State Development Corporation agreed in principle to give Mr. Ratner an extra three years, until 2019, to complete the development."

The article stated that "Gov. David A. Paterson and Mayor Michael R. Bloomberg have been eager to ensure that Atlantic Yards, which will eventually include more than 6,000 apartments in 16 buildings, remains alive at a time when projects across the city have been halted by the recession."

In its testimony before the MTA board meeting, the Regional Plan Association indicated it was opposed to the current deal:

"The redesigned project is a far cry from the one that was approved by the Empire State Development Corporation in 2006 following extensive public debate. The benefits to the MTA and public have been greatly diminished, including less cash up front for the MTA, a scaled-back rail yard that would accommodate fewer rail cars with less efficiency, a replacement for Frank Gehry's signature architecture, and an indefinite delay in the affordable housing, office space and open space that were to provide most of the economic and community benefits."

"If the deal falls through, it is likely to be years before the market recovers enough to attract new developers," it declared, adding that "If project moves forward, it is almost inevitable that it will need to be redesigned and renegotiated."

"The question is, does this new agreement retain enough benefits for the MTA and the city to proceed with a scaled-back plan. Based on the information available, the answer is no," the association argued.