Walking the Tightrope Without a Net (or Nets) – is Ratner and Forest City Running Out of Money ?

Written By: Talk of the Sound News

In a late breaking news report , the top dog of Forest City , Bruce Ratner , has decided to sell a majority share of his beloved Nets basketball franchise to Mikhail Prokhorov . Thrown in with the deal is a stake in the troubled Brooklyn Yards fiasco that has Ratner against the ropes , scrambling to make a deadline before his option of using tax exempt state bonds expires . Forest City recently issued about 3oo million dollars in new stocks to raise capital. Apparently it wasn’t enough , forcing Ratner to give up his controlling share of the Nets in what some would say is a measure motivated by desperation.

Could this be the begining of the end for Ratner ? Who knows, but if you follow the constant restructuring and selling off of assets and curtailing of projects , one has to wonder .

The question for New Rochelle to ponder should be are we ready to support and give out more handouts to a company in a state of flux like Forest City? It appears they are up to their eyes trying to stay afloat , so maybe , when the subject of extending their right to Echo Bay comes around in January , we as a city should just say NO. It is well within our legal and moral right and could only be considered as good governing.Perhaps it would be in the city’s best interest to not offer the extension and let Forest City sort out their issues before we wind up with the delays and turmoil being seen in Brooklyn.

I’ll say it again , tax abatements , PILOT programs , overburden of services , non revenue generation , impact on schools , decemation of local neighborhoods ,traffic overload , all to make money for an outside developer. Is THIS right for New Rochelle? Ask yourself , who really benefits , because , much like the new Mr Ratner , New Rochelle doesn’t have a net either .

5 thoughts on “Walking the Tightrope Without a Net (or Nets) – is Ratner and Forest City Running Out of Money ?”

  1. This exchange convinced me…
    …that the site is ready to disable anonymous comments.

    The site will take a short term hit in terms of traffic but in the long run we will get more discussions like these in the comment threads.

    Thank you, gentlemen.

  2. forest city
    john and bruce you are both right if you assume that new rochelle has a choice (bruce) or say (john in the matter. A number of former colleagues and associates from new york state controllers and various ventuer capital/large scale investment brokers are pretty pessimistic about the survival chances of forest city. there might not be a choice; chapter 11 minimally or worse looms and if that turns out to be the case, the contract and various agreements will legally determine the terms and rights relevant to all clients including new rochelle.

    interestingly, the major russian investor has made a significant share of his money in prostitution and the rest in nickel mines. what will happen if the blue noses get wind of this.

    but i prefer him to the vultures in ratner’s group, forest city, and all of the various legal corporatons that ratner operates under. my big concern is city administration — noam is seeing this more as a legacy project than as a benefit to new rochelle. if you press strome he will have to admit that it will take years to get dime one from this project even if on schedule. imagine the scenario if forest city remains and we sit here fat and happy waiting for their calendar and strategic plan to take effect.

    but, the devil is always in the details. we may know some things about the abatement structure, physical plans for the area, etc…. but we know nothing substantial about bail out clauses, rights to post project planning amendments, etc….. my take is that forest city are tough customers but ratner will blink. he blinked in brooklyn on some community concerns and he will blink here if we had the right people pressing him.

    no bruce, one thing we probably do have access to are the various pre-planning documentation. presuming, and this is a large presumption, that we move foreward (do not elect the current administration and odds increase in opposition’s favor), forest city becomes a no legacy, is it good for us project. this means we should not a prolonged pre-project plan, the market is stone cold and we could pretty much dictate form and substance (including john the keeping of the armory) and being that business stinks, surely better terms that forest city “generously” offered us some years earlier.

    gentlemen, i would get better lawyers than we have and bail in a responsible way and, if needed take a financial hit of some amount. done right, it would be cheaper than the end state of the current deal. the new deal can provide some assurances of on-going incoming cash flow and give the city fathers some room to look for alternatives for the yard. imagine going into that little detail with no location and no idea of funding? this is a sure sign of the absence of any planning sense in the city. add to that the serendipity involved in thinking that the upcoming disaster on school capital financing is “the districts problem” or that the investment market cannot wait for new rochelle to come to the table. Mercy me, I would sooner have rod blagjovich, david patterson, or even moammar khadafy doing a deal. sometimes madness or sheer incompetency is better than having a little knowledge, a lot of arrogance and no common sense.

    bruce i don’t know you but admire your various postings as I do John D’s. you sound like mayoral material to me. think on it.

    thanks gentlemen for both agreeable and grown-up discussion.

    warren gross

  3. John point taken- But who would develop in NR w/out incentives
    New Rochelle is hanging on to these developers because things are in motion and it would take years to even plan new projects. I am sure you are aware of this and what I just wrote is not to be seen as in favor of this or not.

    Development is necessary for New Rochelle to survive. Most people think this as well but will throw in the term “responsible” development. It is time to ask what them what that really means.

    I want definitions. I want examples. I will even take hypotheticals in terms of defining “responsible” and in terms of laying out a vision.

    The question to really ask is would anyone develop, build or open a major store here without the abetments and PILOTS. Yes, the handouts are probably (that is a diplomatic way to say it) way to generous but I am sure you like I saw an empty mall, vacant lots and a decaying downtown for 30 some odd years.

    Everyone left and it took 30 years and a huge pot of honey to get anybody to sniff New Ro again.

    To me responsible development does come in the form of transit oriented development.

    I have put my name to this response so I am ready to be knocked over the head by others waiting to post. I ran for office so I am used to it. You can take a shot at me and my thoughts but come with some kind of definition or vision of what New Ro is to be or become. It’s too easy to throw bombs form the back.

    What NR needs is people to start meshing their ideas of what NR should be and maybe getting some traction for that. In the absence of any one speaking up and offering solutions or recommendations our city government will speak for us and in their voice not ours.

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    1. Its hard to mesh idea’s when
      Its hard to mesh idea’s when your goal maybe a political climb to a congressional seat.
      How would anyone justify Building Trump Cappelli a project for million dollar apartments in the same vicinity of Target and Kohls and neighboring New Rochelles answer to Coney Island New Roc. Lets remember they were not building Trump Village on Ocean Pkwy in Brooklyn which bears Donald Trumps dad name.
      Before I develop anything I ask myself what is the City of New Rochelle? The answer I keep getting is a City of Diverse Citizens based around Homes, Schools and places of worship and family endeavors. I think the Mayor, the City Council and the Commisioner of development have lost track of what the City of New Rochelle is.
      Things that will forever hold back our City Back are
      SECTION 8 HOUSING which hurts everyone including the residents of those properties.
      A Large Illegal Populous which hurts all Citizens, the Schools, the Hospitals and even those who have come here legally. Then look at the City Management Policy that pretends they have nothing to do with the School District. How can they make decisions that impact classrooms and schools and think they are not connected. We have seen study after study that pretends that there are no negative impacts from some of the planning they have taken on. We have seen many years of hap hazzard planning without any goal of what New Rochelle should become what it might become nor what it will be in 10 years, 20 years ect.
      They are hysterical to create a legacy and in doing so they do just about anything rather than figure it out ahead of awarding stupid and almost illegal Pilot programs. When you factor in the extent the Mayor has gone to conduct all of this you begin to see that we are not dealing with sanity. They are desperate and have yet to address what New Rochelle is, what it might be and what it should be. Through it all the City has been hurt badly and may suffer for many years to come.

    2. Yes Bruce K , Development is Necessary ,but …
      Yes , people do call for responsibility in the development of the city . “Responsibile” development , does it really take some sort of “magic “or just a clear vision of how to do it without destroying the quality’s that are inherent to your city ? We are , afterall , a suburban setting , with a tremendous amount of history , and we are lucky to be at a crossroads to either become something of a half assed big city (we don’t have the room or the infrastructure to be a big city) , with all of the baggage that comes along with that , or a shining example of urban planning that makes the most of a pleasant suburban city at the cutting edge of environmental technology , a smart public transportation system , managable schools , a revenue generating historic program . It’ really about being the best , not the biggest .
      We could bounce this around for days , and that’s the point , I guess , the ideas one might consider outside of the box were given absolutely no consideration . Honestly , the city has been acting out of desperation , desperate to get something , anything , going without regard for the revenge of unintended consequence . The interpretation of that is the huge , unnecessary burden on the taxpayer , initially , then on and on as infrastructure, schools , and services pile on their needs to the public . What is happening is we are socializing all of the risk and debt , while we privatize all of the returns . Yes , I would agree , some sort of incentive was needed to get the ball rolling , however it has become wreckless in it’s continued abuse , all without any end responsibility by those who make use of our largess . Many city’s / towns have opted to refuse any clawback provisions but have now experienced the backlash of that decision . Originally fearful of turning developers away with a clawback , they now see the importance of protecting the city’s taxbase . New Rochelle is a prime location by any measure . Is it so wrong to exploit that by warning the people to whom you give a 40 million dollar discount about delivering as promised or pay a price?
      How about Echo Bay . Were you at any of the meetings prior to the city putting out their request for qualifications (RFQ)? The concept pitch at Five Islands Park where it was said again and again how the intent is to provide a “seamless weaving” and it should be”designed to look as though it was always part of the community” by intergrating the streets and being in scale with, and sensitive to, the surrounding neighborhoods . Can you actually say that THAT is what we wound up with? Many, many people feel as if they were duped . Bait and switch. The oldest game in the book. The city did try to be inclusive , but once the developer was chosen , it was all about how they want it to be . Bruce , do you think it’s seamlessly woven , or in scale with it’s surroundings ? Have you read the RFP? It was like giving someone a blank , signed check.
      Did you mention the Armory ? If there ever was a 600 pound gorilla in the room , screaming out to be a showcase venue for the next 100 years it would be the Armory . The city has chosen to get rid of it because an executive from Forest City considered it a “missing tooth” in a smile(his words , not mine).
      From a social and community based standpoint , the possibilities are endless to those with even a modicum of imagination. The mayor has the nerve to talk about sustainability and “green” initiatives , and offhandedly denies the most significant , high profile , most achievable project in the whole city ? World wide acclaim awaits us .
      Where do you stand Bruce ? Even if your in the middle , you have to stop and consider what’s right for New Rochelle . Ask yourself , who really benefits from the handouts and short sighted thinking ? 30 years ago was different . New Rochelle in and of itself IS the “pot of honey” and the sooner our city leaders learn that , the sooner they’ll stop giving away the store . There is this underlying fear that if we don’t give them what they want , we will be doomed to failure . As “political forechecker ” puts it “they are hysterical to create a legacy and in doing so will do anything…”. We have TWENTY THREE acres , on the water , in Westchester and the best they come up with is apartments and condo’s ? Where’s the punch line ? Remember , this was planned during good economic times .
      Are you really saying we should go ahead with a faulty plan that affects future generations just because it’s already in place ? The area has been in it’s present shape for decades , why rush a bad plan through when we have this golden opportunity to re-evaluate things and recalibrate the true nature of overdevelopment and environmental waste . Going ahead with Echo Bay WILL cost the city TENS of MILLIONS of dollars . Rethinking would cost peanuts compared to that and we’re no worse off than when we started . I say let’s get this one right , from the start .
      I’m sure you’ve read some of my posts and can figure where I stand . Hop off the fence and tell us Bruce, what do you see for New Rochelle’s future ?

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