Shaun Donovan Praises Atlantic Yards, But It’s No Model Housing Partnership

A 2005 media event promised more affordability than what’s been produced. The next mayor may face tough decisions, as 876 more income-linked units must be built in four years.

Adi Talwar

Construction underway in November at the Atlantic Yards/Pacficic Park development in Brooklyn.

Trailing badly in the polls, Democratic mayoral candidate Shaun Donovan doesn’t seem like a serious contender.

But Donovan, who headed housing departments for both New York City under Mayor Mike Bloomberg and the federal government under President Barack Obama, has serious policy chops, proposing an extensive housing policy, aiming to increase “the supply of affordable housing, equitably and inclusively, across all five boroughs.”

So it’s disappointing to see Donovan unwisely touting the Atlantic Yards project announced under Bloomberg as an exemplary public-private partnership. In a Real Deal interview Feb. 3, he said the next mayor should plan for “equitable growth.”

“You folks may remember that when we announced Atlantic Yards and the thousands and thousands of units of affordable housing it would create, Bertha Lewis, the legendary progressive activist from ACORN, kissed Mike Bloomberg on the lips,” Donovan stated. “Those are the kind of partnerships that I could build, bringing together progressive leaders and the public sector, the private sector, to create growth.”

In a talk with the Association for a Better New York, Donovan said “we reached a landmark agreement”—actually, the city highlighted a non-binding private deal—to build Atlantic Yards.

Why it matters

It’s too bad that Donovan, whose substantial ideas on housing deserve discussion, gets this wrong—and it’s likely most of his rivals know even less about the issue. But the details matter, just as it matters that candidates know how much Brooklyn real estate costs.

Atlantic Yards was a dubious triumph as of that 2005 “kiss” and today remains a cautionary tale, given the huge gaps between promises and production at the project now known as Pacific Park Brooklyn.

That’s relevant to not just Donovan but also his better-polling rivals, since the next mayor will face tough decisions regarding whether to subsidize—and otherwise further—the yet-unfinished project.

Of the required 2,250 affordable apartments, 782 have been completed and 592 are currently under construction. So 876 income-targeted units face a time crunch. For each affordable unit not ready by May 31, 2025, the developer—now mainly Greenland USA, the arm of a Shanghai-based conglomerate—faces an onerous $2,000/month in state penalties.

So the next mayor could help determine whether those apartments serve the struggling lower-income New Yorkers who Lewis championed, or the middle-income residents who’ve received a disproportionate share of the project’s affordable housing.

That new administration also could continue to greenlight after-hours variances—consistently under-disclosed by the developer—that have helped the project meet its deadlines, allowing work to take place from 5 to 10 a.m. weekdays and on both weekend days, all while neighbors are stuck at home.

Flashback to the Bloomberg era

Atlantic Yards was announced in December 2003 at a press conference featuring Mayor Bloomberg, Brooklyn Borough President Marty Markowitz, and developer Bruce Ratner, whose company Forest City Ratner aimed to move the New Jersey Nets to Brooklyn and build an arena plus 16 towers, all designed—as of then—by “starchitect” Frank Gehry.

A huge civic fight ensued. ACORN’s role came later, as Forest City organized its own “community” coalition, countering criticism of a project relying on a bypass of City Council, eminent domain, and a suite of subsidies and tax breaks.

Forest City negotiated with Lewis and ACORN housing specialist Ismene Speliotis to devise the “50/50 plan,” which deemed half of the 4,500 rental apartments be affordable, with five tiered income levels. That would set a benchmark for gentrifying Brooklyn, Lewis argued—albeit thanks to what was the equivalent of a one-off upzoning.

But the press conference on May 19, 2005 that Donovan now recalls, unveiling the project’s Affordable Housing Memorandum of Understanding (MOU), deserved more skepticism than it got. First, the agreement involved Forest City and ACORN, not public entities.

A city press release misleadingly said 2,250 apartments, half of the rental units, would go to “low- and moderate-income households.” That ignored how, among those 2,250 affordable units, 40 percent—two of the five tiers—were for middle-income households.

The press release, dubiously implying certainty, stated that the administration “worked with Forest City Ratner and ACORN to increase the amount of financing provided to make the apartments as affordable as possible.” But no financing had been allotted, because the project hadn’t been approved. (The first residential tower wouldn’t launch until December 2012.)

Still, the event was dramatic. “I’m getting ready to pay my debt, and here it is!” Lewis declared, kissing the reluctant mayor on the lips, their mouths firmly closed, as captured in a Brooklyn Paper photo.

That housing plan was incorporated into the much-hyped Atlantic Yards Community Benefits Agreement (CBA), a private contract Forest City signed with ACORN and seven other groups—most of which were essentially astroturf—which purported to ensure the touted benefits came to pass.

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