Bruce Ratner and MaryAnne Gilmartin, both of Forest City Ratner Cos.,
at ULI New York’s 2013 Real Estate Legend event.
In April of this year, Bruce Ratner handed the leadership of Forest City Ratner Cos. over to its new CEO, MaryAnne Gilmartin. In May, ULI New York honored him as its 2013 Real Estate Legend. The award was presented at an hour-long question-and-answer session hosted by Greg David, an award-winning columnist and former editorial director for Crain’s New York Business.
Ratner knows how to talk with New York City officials—after all, he was one for seven years. “I have a lot of respect for government. . . . I was comfortable with the give-and-take,” says Ratner, founder of Forest City Ratner Companies, the New York City branch of Forest City Enterprises.
His understanding of city hall helps account for Ratner’s long-career-building huge developments in and around New York City, often involving public land, public subsidy, and even use of the government’s power of eminent domain.
The conversation shows how many of Ratner’s biggest projects happened to align with policy goals such as keeping jobs in the city, bringing large-scale grocery stores to neighborhoods, and bringing a major sports team back to Brooklyn. “I really only wanted to do something that had some economic development component and job growth,” he says.
Ratner says he was “radicalized” by his experience in the 1960s as a student at Harvard University and Columbia Law School. He served two New York City mayors, John Lindsey and Ed Koch, in addition to working as a professor at New York University. He got into real estate during the 1980s, he says, quite simply to earn more than the $52,000 a year in 1970s dollars that he made as New York City’s commissioner of consumer affairs. “I thought: ‘I’m going to make $150,000 and I will be happy for the rest of my life,’ ” Ratner says.
He reached out to his cousins, including his mentor, Albert Ratner, then-CEO of Forest City Enterprises, to develop his first giant project: the development of MetroTech Center in downtown Brooklyn. Ratner joined forces with municipal officials struggling to keep jobs in New York. Chase Bank had announced a plan to move 6,000 back-office jobs across the Hudson River to less expensive space in New Jersey, but Ratner tried to lure those jobs to MetroTech instead. “We sat for really a year negotiating with Chase until they finally agreed,” Ratner says.
Bruce Ratner speaks with Greg David of Crain’s New York Business. Forest City’s development of big-box retail stores in New York also sprang from a mix of policy and profit motives. “There was not enough retail anywhere in the boroughs,” he says. That carried a heavy cost for New Yorkers. Shopping at large-format supermarkets, compared with bodegas, can save families an average $5,000 a year, Ratner says. But the developer also had a profit motive to expand into retail: In 1992, a sharp recession had taken the life out the office market. “I had nothing to do,” he says. “My political side and my profit side came together.”
Convincing retailers to move into spaces in the outer boroughs of New York was not easy. “Company after company said ‘no’ to us,” he says. However, FCRC has now built and filled more than a dozen big-box spaces with retailers including Home Depot, Marshalls, and Costco. At Atlantic Center Mall in Brooklyn, the Target store has the highest sales by volume of any Target in the United States.
Ratner’s controversial Atlantic Yards project began when Marty Markowitz, Brooklyn’s borough president, called Ratner and asked him to buy the New Jersey Nets basketball team and bring them to Brooklyn. “I don’t think I conceived of how difficult it would be,” Ratner says. After nearly a decade of legal battles, Forest City finally claimed the land to build its Barclays Center arena three years ago—partly through eminent domain, partly through a $100 million purchase of land owned by the government. The Nets have just finished their first season at the completed arena. Forest City also just started work on the first of more than a dozen apartment towers planned to surround the Barclays Center.
Forest City received more than $240 million in government subsidy for Atlantic Yards. “Frankly, that’s not a remarkable amount,” Ratner says. The $1.3 billion project has already given the city an $80 million subway entrance and $300 million in track improvements, he says.
Over the course of about 20 years, Ratner’s Atlantic Terminal, Atlantic Center, and Barclays Center filled what had once been a vast open pit in the center of Brooklyn’s neighborhoods of brownstones—including a giant crater of an old construction site, abandoned since the stock market crash of 1929. “There are very few developers that do large-scale, long-term projects—that’s our niche,” Ratner says.