Q&A
Financial feasibility of building the Brooklyn Yards project over a railroad cut
0:27:11
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178 sec
Council Member Kevin C. Riley inquires about the financial feasibility of building the Brooklyn Yards project over a railroad cut, given the unusual location and potential high costs. Ken Fisher from Cozen O'Connor explains the project's viability, focusing on design choices that make it financially feasible.
- The project uses light metal framing and lower building heights (4-6 stories) to reduce costs
- Developers are optimistic about overcoming obstacles and have invested heavily in the project
- The team anticipates applying for the 4485x program and is flexible with MIH solutions
Kevin C. Riley
0:27:11
This is quite an unusual proposal in terms of this projected location on top of a railroad cut.
0:27:17
I would imagine it is very closely costly to build a needed platform for these new buildings.
0:27:22
Could you please explain further why and how this project is financially feasible?
Ken Fisher
0:27:29
So Ken Fisher, thank you for the question, Mister Chairman.
0:27:34
I I wanna start with what the project isn't because for many years, people thought that the only way you could build over these railroad tracks was by putting up towers They assumed that the platform was going to be super expensive and that you had to go high density.
0:27:51
Obviously, that would have been difficult to get the community to accept.
0:27:55
It turns out that the bigger the building, the more expensive the platform, and it didn't pencil out.
0:28:02
What the design team was able to figure out was that by removing the heights of the buildings down to 4 and 6 stories, they were able to use a more efficient construction technique called light metal framing.
0:28:16
They also eliminated certain requirements that would have been applicable into the building code or the zoning for taller buildings.
0:28:23
And so the project pencils out.
0:28:26
Now having said that, let's make a couple of points.
0:28:30
One is, anyone who is a developer in New York is simultaneously an optimist and a pessimist because you can't foresee every possibility.
0:28:40
A few years ago, we were actively pursuing this project when there was no 421A program and it would have been unfinancable.
0:28:47
We now have the 4485x.
0:28:50
We anticipate applying for that and qualifying.
0:28:53
Secondly, as you all know, the special permits that we're requesting have a long duration.
0:29:00
Projects like this may not get built overnight.
0:29:02
It's going to take a considerable period of time before we can do the construction drawings and the engineering and satisfy the MTA and the buildings department and be ready to go into the ground.
0:29:14
Hopefully, by that point, interest rates will have moderated again.
0:29:18
Construction costs will have at least flattened.
0:29:22
That's how we're assuming it's going to go forward.
0:29:25
But I think the best answer to your question is that the developers believe in this project They have spent 1,000,000 of dollars over the course of a decade to move this project forward because they believe that it is critically important for their community.
0:29:44
And whatever obstacles we've had in the past, we've managed to overcome, Whatever obstacles we'll face in the future, they are committed to overcoming, including the requirement for financing.
0:29:56
It is why we've asked for a certain amount of flexibility with respect to the NIH solution and we look forward to moving this project forward as quickly as we can.
