Related in talks to take over Pacific Park megaproject

The Related Companies wants to do for the Pacific Park project what it did for Hudson Yards.

The firm, chaired by Stephen Ross and run by Jeff Blau, is in talks to take over the behind-schedule and over-budget Brooklyn project, The Real Deal has learned.

Pacific Park’s developer, Greenland USA, defaulted on its debt last year. The company’s lenders, Nick Mastroianni’s U.S. Immigration Fund and Fortress Investment Group, filed to foreclose on the property, but the scheduled auction has been postponed four times.

Part of the problem is that any new owner would have to be approved by the state’s economic development agency, Empire State Development. The Atlantic Yards Community Development Corporation, a subsidiary of ESD that makes recommendations on the project, disclosed at a meeting last week that the state is expecting a proposal from the lender and a potential developer.

“ESD is fully committed to moving this project forward and will be carefully reviewing the lender’s proposal,”
a spokesperson said in a statement Tuesday.

Representatives for Fortress and for Mastroianni’s USIF declined to comment. A spokesperson for Related could not immediately be reached.

Related makes a logical choice for the complicated and difficult project next to Barclays Center. Not only is the company among the biggest residential developers in the city, it also has experience decking over the rail yards at Hudson Yards.

At the Pacific Park development sites in question, platforms must be built over active train tracks to support more than 3,200 residential units. Greenland had previously said construction of the first section of the platform, on which three residential towers will be built, would take 36 to 40 months.

The logistics of the platform is just one of the major hurdles that need to be overcome. The others are largely financial.

Much about the project remains uncertain, including whether the state will sweeten the deal for the new developer or soften the potential consequences of project delays. Greenland, and in theory its replacement developer, face millions of dollars in penalties if a 2025 deadline to build nearly 900 affordable apartments is not met.

Given the timeline for building the decks, the housing deadline cannot be met.

Forest City Ratner, the original developer of the project, then known as Atlantic Yards, was granted an extension to build the affordable units in the wake of the Great Financial Crisis, prompting criticism from opponents of the megadevelopment.

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