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April 10, 2012

Why would Ratner be willing to give Wang a Share of the Atlantic Yards Development?

The answer to that question is fairly simple, he needs more money to get the project completed.  Ratner has been trying to get the financing for the development, but he hasn't been able to get all the money he needs.  He has even asked the city for more money and got shot down.
If Forest City can't save money via modular construction, how do the numbers "pencil out"? After all, in March 2011, talk show host Brian Lehrer asked Rafael Cestero, outgoing Commissioner of the Department of Housing, Preservation, and Development (HPD), about the report that HPD had declined Forest City Ratner's recent request for an additional $10 million in additional subsidies--beyond the $14 million for 150 units--for the first residential building.

"One is, we have a set of programs that we use across the city... that fall within certain subsidy parameters that make sense for taxpayers and make sense for the city," Cestero responded. "We felt that the additional subsidy that Forest City was requesting... didn't meet those parameters and, frankly, that we felt was not a good public investment to go beyond what we have already committed."

"We want to see housing built there. We're all deeply committed to seeing not just the arena built, but to see... the affordable housing built," he added, "but we think the parameters that we've laid out, the program that we've laid out, allows that project to go forward."

This is where Charles Wang can come in on this project.  Wang can help Ratner finance the development and in return get back a pretty nice chunk of the profits from it.  Plus being part of one of the most desire sites for development left in Brooklyn and New York City can only help Wang in his future real estate adventures.  There are just too many potential positives for Wang not to look into being part of the Atlantic Yards and also too much money to be made.

A partnership between Wang and Ratner solves many of their current problems.  For Ratner it allows him to complete his vision for the site and make a nice return on it even after all the court cases and delays.  For Wang it gives his hockey team a state of the art home and the development around the arena that he always said he needed to run the team correctly.  Plus being part of the Atlantic Yards Development can only help him as he moves forward in his real estate  career

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