Barclays Center Owner Drops Challenge to City's $741 Million Appraisal
PROSPECT HEIGHTS — What a blooper.
The owner of the Barclays Center says it erred when it claimed the city overvalued its sports arena by $600 million.
On Friday developer Forest City Ratner withdrew its challenge to the city’s appraisal of the Nets home, claiming it made a mistake.
DNAinfo New York first reported on Tuesday that FCR had filed a court petition on Oct. 22 that challenged the city’s $741 million valuation of the taxpayer-subsidized arena. Its petition claimed the arena was worth a measly $111 million.
In a letter sent to the city’s Law Department and Finance Department on Friday, FCR said it goofed on challenging the appraisals of the Barclays Center and other developments on the 22-acre Atlantic Yards property.
“In challenging the assessments on Forest City properties, petitions on its arena and B2 sites were inadvertently included,” the letter said. “Forest City has instructed our attorneys to discontinue these petitions immediately.”
The city determines a commercial property’s value by its potential income. The Finance Department then calculates property taxes off that appraisal.
FCR’s challenge raised eyebrows because it doesn’t pay property taxes on the arena and other Atlantic Yards developments.
The developer received more than $761 million in government subsidies and tax-exempt bonds to build on the fallow rail yards in downtown Brooklyn. As part of the deal, it makes payments in lieu of taxes, or PILOTS.
Normally, the Finance Department collects a property tax of about 10.3 percent of a property's assessment. An assessment is 45 percent of the determined market value.
In the petition, FCR said the Finance Department gave the arena a property assessment of nearly $334 million. The developer estimated the assessment at less than $50 million.