This shocking news release from Forest City Enterprises just landed in our mailbox.
FOREST CITY ENTERPRISES
The Arena Can Wait. Affordable Housing Now.
Forest City Ratner Prioritizes Affordable Housing
Over Barclays Center Arena
In Brooklyn Atlantic Yards Project
CLEVELAND, Ohio and BROOKLYN, New York - April 1, 2011 - Forest City
Enterprises, Inc. (NYSE: FCE.A and FCE.B) today announced that the Barclays Center
Arena for which it broke ground just over one year ago, is going on the backburner
so the development firm can break ground on the affordable housing units it has
long promised to construct for Brooklyn.
Bruce Ratner, chairman and chief executive officer of Forest City Ratner Companies,
the company's New York-based subsidiary, and other Forest City executives, were
joined by New York Governor Andrew Cuomo, New York City Mayor Michael Bloomberg,
Brooklyn Borough President Marty Markowitz, Barclays PLC President Robert E.
Diamond, Jr., NETS investor and cultural icon Shawn "JAY-Z" Carter, and many
other community leaders to happily announce that they realized the depravity
of constructing a money-losing, billion dollar arena in the middle of housing
crisis and will immediately commence construction of affordable housing towers.
Bruce Ratner announced, specifically, that all work on the arena
would cease immediately so that the construction crews could begin constrcution
of the residential towers, all fourteen of which Ratner said would be built
within five years.
Forest City has told Mikhail Prokhorov's Onexim Sports & Entertainment
that Barclays Center may be a good business venture for him and his ownership
of the Nets may be good for his portfolio, but that they are sorry, the priority
must be housing over bread and circuses.
ACORN Executive Director Bertha Lewis joined Bruce Ratner in saying, "The
arena can wait. Affordable housing now!"
Bruce Ratner added, "We know that we will construct all 2,250 units of middle
and moderate income housing within the next five years. We will do this if it
is the last thing I ever do. What we do not know is if we'll ever build the
Barclays Center Arena. That is for another day. Maybe we will, maybe we won't.
Once we complete the affordable housing, then we'll decide if we can do the
arena. I'm trying to be as up front as possible because this is, after all,
a public project. For now I can proudly say that it feels good to truly respond
to the needs of the Borough of Brooklyn, rather than the needs of that limey
bank, that jet-skiing Russian playboy and my uncles in Cleveland."
Ms. Lewis also added, "I'm shocked that Bruce is now prioritizing affordable
housing. We hadn't even asked him to do this!"
Governor Cuomo said, "What's the Atlantic Yards project?"
Nets President Brett Yormark took a break from a brown bag lunch and not sleeping to announce
that he'd incorporate the new found interest in affordable housing into the
season's final Nets game at The Rock. Yormark said that all fans who attend the
final game will get a priority voucher for the affordable housing lottery, giving
each fan a 25% chance of getting one of the units.
"When we announced Atlantic Yards in December 2003, we anticipated that we'd
build a world class arena. Then we got ACORN and the politicians on our side
by saying we'd build affordable housing. Then we jettisoned most of the affordable
housing, and put it all on the backburner with no timeline. Frankly we never
planned on building most of it," said Ratner. "But now...the affordable housing
is back and we're sticking to it!"
Robert E. Diamond, Jr. the President of Barclays PLC, which holds the naming
rights for the arena, said, "Barclays is proud to be part of the ongoing renaissance
of Brooklyn. And we understand that an arena, which sits empty nearly all of
the time, will do nothing to alleviate the crisis in affordable housing, it
will only take up scarce land resources. Who are we to waste land that Brooklynites
need? Having said that, we'd be happy to place our logo on any affordable housing
tower Bruce builds, even they are prefab!"
"The Barclays Center at Atlantic Yards is supposed to be the first piece of
what will be one of the largest private investments and job generators in Brooklyn's
history," said Mayor Bloomberg. "Now Bruce says he's not going to build it because
he thinks we need to prioritize housing? Enough already; I'm done with this
guy. At least we won't have to watch that crap basketball team any time soon."
Brooklyn Borough President Marty Markowitz said, "Fuggedaboudit. People of
good will can disagree, but as for me, this is the last straw. I now oppose
The affordable housing towers will be designed by the award-winning architectural
firms Ellerbe Becket and SHoP Architects. The residential towers are expected
to be built as quickly as is humanly possible in accordance with the mandate
announced by Bruce Ratner today. Ratner also announced that he would not skimp
on square footage for the affordable units, and because of the new plan to use modular construction half the number of construction worker vehicles will clog the streets of Prospect Heights.
In addition to Barclays, the naming rights partner, the Barclays Center had
10 major partners, including: ADT, Cushman & Wakefield, EmblemHealth, MetroPCS,
MGM Grand at Foxwoods, Jones Soda, Haier America, Phillips-Van Heusen, Anheuser-Busch,
and High Point Solutions. Bu today they all walked away in a huff.###
About Forest City
Forest City Enterprises, Inc. is an $11.9-billion
NYSE-listed national real estate company. The Company is principally engaged
in the ownership, development, management and acquisition of commercial and
residential real estate and land throughout the United States. For more information,
Safe Harbor Language
Statements made in this news release that
state Forest City Enterprises' or management's intentions, hopes, beliefs, expectations
or predictions of the future are forward-looking statements and may be untrue
or may not be, and may be honest or may not be. The Company's actual results
could differ materially from those expressed or implied in such forward-looking
statements due to various risks, uncertainties and other factors. Risks and
factors that could cause actual results to differ materially from those in the
forward-looking statements include, but are not limited to, the impact of current
market conditions on our liquidity, ability to finance or refinance projects
and repay our debt, the impact of the current economic environment on our ownership,
development and management of our commercial real estate portfolio, general
real estate investment and development risks, liquidity risks we could face
if we do not close the transaction with Onexim Group to create a strategic partnership
for our Brooklyn Atlantic Yards project, vacancies in our properties, further
downturns in the housing market, competition, illiquidity of real estate investments,
bankruptcy or defaults of tenants, anchor store consolidations or closings,
international activities, the impact of terrorist acts, risks associated with
an investment in a professional sports team, our substantial debt leverage and
the ability to obtain and service debt, the impact of restrictions imposed by
our credit facility and senior debt, exposure to hedging agreements, the level
and volatility of interest rates, the continued availability of tax-exempt government
financing, the impact of credit rating downgrades, effects of uninsured or underinsured
losses, environmental liabilities, conflicts of interest, risks associated with
developing and managing properties in partnership with others, the ability to
maintain effective internal controls, compliance with governmental regulations,
increased legislative and regulatory scrutiny of the financial services sector,
volatility in the market price of our publicly traded securities, litigation
risks, as well as other risks listed from time to time in the Company's SEC
filings, including but not limited to, the Company's annual and quarterly reports.