Shanghai-based Greenland Group is making a contribution of roughly $200 million in exchange for a 70 percent equity interest in Forest City Enterprises’ Atlantic Yards development, not including the Barclays Center and B2, the project’s first residential building.
The two companies will be sharing the development risk related to their ownership shares, including costs related to infrastructure and vertical construction for phases one and two, moving foward, GlobeSt. reported, citing a disclosure from Forest City.
“Greenland’s commitment to Atlantic Yards, including the initial capital contribution, the assumption of a 70 pecent share of all future costs, as well as additional capital resources, will serve to accelerate vertical development going forward,” David LaRue, president and CEO of Forest City, told GlobeSt. “We believe this joint venture enhances Forest City’s ability to both fulfill our commitments to the community and create value over time by achieving an appropriate, risk-adjusted return on our invested capital.”
Total costs on the acquisition, which include the price of finishing the Metropolitan Transportation Authority’s permanent rail yard, are expected to be around $1.3 billion, GlobeSt reported. And the total costs will likely yield an average cost per square foot of between $180 and $220, based on the remaining 6.4 million square feet of entitlements in both phases. [GlobeSt] – Julie Strickland