Deeds and Deals

Last Call for Bar’s Lonely Anti-Atlantic Yards Boycott

Boycotting can be a lonely business. Just ask Frank Yost, proprietor of Freddy’s Bar and Backroom in Prospect Heights, Brooklyn.

Freddy’s is the last bar standing within the 22-acre footprint of Forest City Ratner’s Atlantic Yards project. The famous dive and art gallery, which is slated for destruction to make way for the $4 billion complex, stopped serving Brooklyn Lager a year ago this week, joining what then seemed to be a growing protest over Brooklyn Brewery president Stephen Hindy’s support for the project. Brooklyn Brewery has a concession contract at the New Jersey Nets’ Continental Arena, and Mr. Hindy hopes to get one in the N.B.A. franchise’s new Atlantic Yards arena, too.

Protest groups called for a boycott, and Freddy’s soon complied, forever unscrewing its Brooklyn Lager tap in favor of Labatt’s Blue. (The lager was the only Brooklyn Brewery brand it served.)

One year later, it’s hard to find a local bar that isn’t aware of the attempted boycott—but even harder to find one that doesn’t serve Brooklyn Brewery beers.

“It’s got a lot of brand loyalty,” explained Adam Wisniewski, a bartender at the Lighthouse Tavern on Fifth Avenue and Garfield Street, which serves several varieties of the brewery’s beer. “And when people come to us from out of town—even just Manhattan—they want the local beer.”

The sentiment behind the flailing boycott remains strong for some Brooklynites, however.

“I only know about [the boycott,] because some guy came in last week and said he wouldn’t drink here ’cause we have Brooklyn Lager,” said Marisol Agredo, a Park Slope native working at Great Lakes on Fifth Avenue and First Street. “The guy walked out so fast I couldn’t ask him what he was so mad about.”

At Freddy’s, a Brooklyn Brewery logo with a slash painted through it still hangs over the bar, and Mr. Yost, an avuncular pony-tailed type, holds nightly court at the far end of the bar behind a glass of red wine. Asked about the boycott that is likely to die with his bar, he offered a diplomatic shrug. “Business is business,” he said.

Mr. Hindy is less forgiving. “It’s aggravating to think that people believe that damaging a local business could have any impact on the future of the Atlantic Yards project,” he said.

He was referring, of course, to his own business. Reminded that Freddy’s is a local business as well, he replied: “I didn’t do anything to hurt Freddy’s.”

—Douglas Quenqua

Moinian, Shvo: Bold or Crazy With New Downtown W Hotel?

Joseph Moinian and Michael Shvo made it official: The developer and the marketer announced plans on March 28 for a 57-story condo-hotel at 123 Washington Street. (The Observer broke the news of the partnership earlier last month.)

The condo-hotel, dubbed the W New York Downtown Hotel & Residences, will have 217 guest rooms and 222 condos. Located just one block from where the Freedom Tower will sprout into the air, the swanky digs are either a risk for Mr. Moinian and Mr. Shvo—or a visionary move that will pay off over the next several decades.

Sales in the fresh W are expected to start in the middle of this year, with a full building opening in 2008.

—John Koblin

City to pony up for Yankee Stadium Garages

One of the loose threads in the construction of the new Yankee Stadium was who was going to build new parking garages that the team wanted built. The Yankees said at first that the private sector would step up to the, um, plate, but skeptics didn’t see many companies out there clamoring for the project.

This month, to build the garages, the city is calling upon a nonprofit organization with ties to Michael Bailkin, a lawyer who virtually fathered the city’s earliest economic incentives during the Koch era.

The Industrial Development Agency, an arm of city government, is getting ready to award $186 million in tax-free bonds to Community Initiatives Development Corporation, a Hudson, N.Y., organization that is headed by William S. Loewenstein, Mr. Bailkin’s former partner at Stadtmauer Bailkin Biggins LLP.

As a nonprofit, CIDC is able to qualify for tax-exempt loans that it has used to develop senior centers, affordable housing complexes, senior centers and municipal garages in upstate New York and Pennsylvania, according to its tax filings. It is unclear what the firm plans to do with the parking revenues. Mr. Loewenstein did not return a telephone message.

Originally, when the Yankees announced the stadium deal in June 2005, the team said that garage revenues would go to the state in return for contributing $70 million to the project. The city will pitch in $21 million—although that is supposed to be used to build a park on top of the garages, according to documents released by the I.D.A.

—Matthew Schuerman

Tax-Exempt Bond Crisis Resolved, H.F.A. Says

The state Housing Finance Agency has made deals to fund five apartment buildings that were in jeopardy because of a shortage of tax-exempt bonds. H.F.A. president Priscilla Almodovar told The Observer on Tuesday that the new deals would reduce the state’s outlay by 9 to 30 percent compared to the developers’ original proposal, though not all of them came in under the limit she had first imposed.

“I’m pleased with the outcome, because the industry acknowledged that we were trying very hard to do this in a fair and equitable way, and they acknowledged that to bring in policy by linking financing to affordable housing is not a bad thing,” said Ms. Almodovar, who was appointed as head of the lending agency by Governor Eliot Spitzer in January.

H.F.A.’s tax-exempt bonds go to buildings that make at least 20 percent of their units affordable to households making 80 percent of the area median income. Each year, the state permits H.F.A. to allocate about $300 million to projects of its choosing, but the booming rental market, along with recent rezonings that encourage these 80/20 projects, had created billions of dollars’ worth of requests.

Because of the high price of land and construction, the developers asked for as much as $3.14 million in financing for each affordable unit to be built. Ms. Almodovar forced all developers with applications pending to resubmit those applications and limit their requests to $1.5 million per affordable unit.

Not all of them did, but in a series of face-to-face negotiations with the developers, she said she was able to get five of them to go forward with their projects for less than $1.7 million for each affordable unit: Silverstein Properties, the Related Companies, Douglaston Development, Edison Properties and Rockrose Development Corp.

Ms. Almodovar wouldn’t release details of the arrangements, saying that the developers still had to consult with their financing partners and that the deals wouldn’t come before the H.F.A. board for approval until May. One developer, however, even increased the number of affordable units to 25 percent of the project. (Ms. Almodovar declined to say which developer.)

When asked to comment about the resolution, Jon McMillan, the planning director for Rockrose, said in an e-mail: “Happy? No. Moving forward? Yes.”

The other developers didn’t return messages by deadline, would not comment, or were unavailable because of the Passover holiday.

Another developer, Steve Witkoff, who had originally asked for $204 million in financing to build a 366-unit 80/20 building (with $3.14 million for each of the 65 affordable units), decided not to ask for tax-exempt financing, Ms. Almodovar said. Mr. Witkoff didn’t return a telephone message.

“I don’t think all of the six or so projects that were most pressing have all come to a resolution, but they are very close,” said Michael Slattery, senior vice president at the Real Estate Board of New York.

Ms. Almodovar said the five projects would eat up almost all of the $300 million in bond capital available for 2007, along with the balance carried forward from 2006, and that some of the volume from 2008 and 2009 would also be called for.


She Dreams of Kabbalah Center On the Lower East Side!

Madonna’s coming back! The Queen of Pop will be touring 179 Ludlow Street on the Lower East Side next week, where she hopes to develop a three-floor kabbalah center. Madonna heard about the space by way of some big-time developer friends in the neighborhood, according to James Famularo of New York Commercial Realty Services.

“Her representative told me that she is friends with some of the hoteliers in the area, like Jason Pomeranc,” Mr. Famularo told The Observer on Tuesday. “Word is, she is really excited about it.”

This is not the only piece of real estate that Madonna has been looking at in the Big Apple. As The Observer recently reported, she hit the Upper East Side in early March to tour four different townhouses.

New Jersey investor Michelangelo Russo owns 179 Ludlow Street. Mr. Russo signed a contract on the six-story building about six months ago, but a conflict that arose between brothers Steven and Peter Salvesen, the former owners, threw the building into auction; then the auction was held and no one showed up. After all the hoopla, Mr. Russo got the building for $5.2 million.

Mr. Russo plans to develop high-end rentals on the residential floors, but no one has spoken for the three retail floors below, totaling 2,400 square feet. According to Mr. Famularo, the monthly rent for the retail space will come in at around $45,000.

—Mark Wellborn

Deeds and Deals