Tishman Speyer Properties LP
Counting the iconic Chrysler Building and Rockefeller Center amongst its assets, Tishman Speyer is a major real estate player in the city. In 2006, Tishman Speyer partnered with BlackRock Realty in the largest real estate deal in U.S. history: the $5.4 billion purchase of Stuyvesant Town and Peter Cooper Village. Their valuation of this property was based on the heady assumption that the income from it would triple in five years. The result: Tishman Speyer defaulted last year on $4.4 billion of debt from the deal. Tenants, moreover, have been cleared by the state’s high court to pursue up to $215 million in damages and rent rebates from Tishman Speyer for illegally collecting raised rents despite receiving tax breaks as part of a program designed to promote renovations in exchange for keeping rents affordable. This program cost the city an estimated $257 million last year in forgone property taxes.
Forest City Ratner Corporation
Forest City Ratner is the developer responsible for the Atlantic Yards project in Downtown Brooklyn that, in addition to the Barclay Center, will include 247,000 sq ft for retail use and 336,000 sq ft of office space. It has proven to be one of the most controversial projects in recent memory. In July, a hearing was held to discuss whether Forest City Ratner should receive nearly $92 million in tax-exempt bonds for the project, yet the city made only the bare minimum effort in publicizing the hearing. It was only attended by a few dozen people, and would-be voices were drowned out.
Holding $15 billion worth of assets, this developer counts the 10-year, $15 billion Hudson Yards project in the far West Side as its capstone project. Public subsidy watchdog group Good Jobs New York testified before the New York Industrial Development Agency in July to argue against a proposal to give further subsidies to the tune of $100 million to Related Companies for yet another commercial tower when the Bloomberg administration has already made extensive efforts to make the area ripe for development through re-zoning, massive infrastructure investment and various tax breaks. The city may now be responsible for an additional $500 million by the end of 2015 just to service the interest on the $3 billion in bonds given to the Hudson Yards project. At the end of August, Related extracted an agreement for labor-cost-cutting measures from the city’s construction unions after months of tense negotiations. Related Cos. reportedly threatened to use nonunion labor for the project if it did not get the labor cost-savings it wanted.