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State Goes to Court to Seize Seven Properties for Atlantic Yards Project

By James Fanelli | September 12, 2014 8:44am
 The state has filed an eminent domain petition in Brooklyn Supreme Court to seize seven properties in the Atlantic Yards development zone.
Condemnation Proceedings Begin on Atlantic Yards Properties
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PARK SLOPE — New York has begun condemnation proceedings on seven properties located within the Atlantic Yards development zone that will become the future site of market-rate and affordable housing, new court records show.

Last month, the state's Empire State Development Corporation filed an eminent domain petition in Brooklyn Supreme Court, asking for a judge to determine compensation for the properties' owners.

The agency plans to seize three residential buildings, 495, 493 and 491 Dean St., according to the Aug. 20 court filing. It also seeks a vacant lot at 37 Sixth Ave., a commercial building at 25 Sixth Ave., a StorageMart facility at 728 Atlantic Ave., and 700 Atlantic Ave., a century-old industrial facility that a real estate investment firm purchased in 2012 for $7 million, the court filing shows.

The land grabs were expected as previous court rulings granted the state the right to exert eminent domain for re-development of the area. But when the state would actually seize the properties had been unclear.

In an Aug. 20 filing, the ESDC said it needs the properties to build four residential buildings, a public school and open space on the 22-acre tract of land that developer Forest City Ratner redubbed Pacific Park.

Earlier this year, in order to expedite the development of 6,400 units of housing on the land, FCR teamed with Chinese-state-owned developer Greenland Holding. Under their deal, the two developers created a joint-venture company in which Greeland acquired 70 percent of the project and FCR retained the remaining 30 percent.

Earlier this summer, the footprint for the project and related debt costs were sold to the joint venture, Greenland Forest City, for $547 million, according to FCR. A July 9 property filing shows that Greenland Forest City paid more than $11.5 million in real estate transfer taxes.

Forest City Ratner, which erected the Barclays Center, is currently building B2, a modular tower. However, construction stalled last month when a dispute broke out between FCR and the contractor, Skansa USA, about delays and cost overruns on the tower.