By Jason A. Orr
Real estate developer Bruce Ratner is a real class act with two eyes on the ball – a basketball, though he is not known for playing the game. He does own the New Jersey Nets, and for years he has been fighting to carve out a new home for the team in Brooklyn. No obstacle can stand in the way of Ratner’s ambition, not even current residents who stand to lose their homes and businesses. With some help from a few infamous friends, Ratner recently held a groundbreaking on New York’s largest and most controversial development project.
Ratner bought the Nets in 2004 with plans to relocate the franchise to Brooklyn, to be modestly complemented by a multi-billion dollar, 22-acre real estate development. (Incidentally, Ratner’s purchase of the Nets began the team’s nosedive into a record-breaking losing streak.) When Ratner proposed bringing a professional sporting franchise to a place deprived of such a major-league cash cow since the Brooklyn Dodgers skipped town in 1958, city officials were able to squint hard enough to find “urban decay” in the up-and-coming neighborhood of Prospect Heights, where Atlantic Yards would be built.
Ratner’s ambitious development scheme calls for 16 swanky residential and office skyscrapers that will surround a new basketball arena. The neighborhood this arena is replacing was a popular place before Ratner decided to build on top of it: Freddy’s Bar is so popular that the patrons have taken to handcuffing themselves to their tables like an environmentalist chained to a tree.[1]
Daniel Goldstein, who owns a condominium that stands at center court of this planned sporting venue, and other property owners recently lost in a lawsuit that could have rescued current residents and business owners – many of whom have already been forced out of their homes.[2] Goldstein has become a leader in the grassroots opposition to the project.
Ratner has his grassroots supporters, too. Well, kind of. Ratner hired a group called the Association of Community Organizations for Reform Now (ACORN) to perform “political cover,” and later bailed out the ailing non-profit with a $1 million low-interest loan and $500,000 in grant money.[3]
You may remember ACORN from such well-publicized scandals as the 2008 presidential election, when they were accused of widespread voter fraud.[4] Or maybe the time when the founder’s brother embezzled nearly $1 million in donor money, followed by a years-long cover-up.[5] Or maybe you heard that undercover conservative activists posed as sex workers, and ACORN employees gave them useful advice on tax evasion, human smuggling, and child prostitution.[6]
Back to Ratner: noisy ACORN employees were crammed into every public hearing, press conference, and media event to demonstrate “public support” for the Atlantic Yards development. In exchange, Ratner promised the group control of the marketing, applicant screening, and housing lottery of the prized “affordable housing” units in the development, a deal which could bring the organization between $5 and $10 million annually.[7]
Our friend Bruce has other ways of drumming up support for his projects, too.
When Ratner is not busy destroying successful basketball franchises or razing vibrant middle-class neighborhoods, he is apparently bribing government officials to approve his pie-in-the-sky real estate developments. At least, that is what is implied by federal investigators in Yonkers, where a former council member and GOP leader have been indicted for a combination of conspiracy, bribery, extortion, false statements, and tax crimes.[8]
Apparently people started getting suspicious when a councilwoman who had been vehemently opposed to Ratner’s “Ridge Hill” development (accusing him of “robbing the city blind”) suddenly changed her mind after meeting with Ratner’s representatives to discuss the matter. And her cousin suddenly received $60,000 in a backdated contract with Ratner’s company for services as a “real estate consultant,” even though her cousin had nothing resembling real estate experience.[9]
Besides scandal-ridden non-profits and corrupt politicians, Ratner is eager to add to his list of business associates Russia’s wealthiest oligarch, Mikhail Prokhorov. With the failing Nets hemorrhaging money and the financial markets on the defensive, Ratner needed a quick cash infusion to get the ball rolling on Atlantic Yards, so he agreed to sell an 85% percent share in the Nets and a 45% stake in the future arena to the notorious billionaire playboy for the sum of $200 million.[10]
Prokhorov, who earned his billions in the mining industry, has an interesting group of friends. Shabtai Kalmanovich, an old business partner, allegedly made a fortune in blood diamonds before buying three sports teams. Even though he was a long-time Soviet spy who double-crossed Israeli intelligence, the police speculate that it was his role in Russian basketball that led to his being gunned down in his car last November.[11]
One could understand why Prokhorov might want to invest in an American, rather than Russian, basketball team.
In 2007, Prokhorov was arrested in France on pimping charges after the police broke into his orgiastic New Year celebration. An articulate Prokhorov offered this in defense: “I like models. I like beautiful people. They are my friends.” The charges were eventually dropped, and with a little help from Vladimir Putin, Prokhorov got an apology from French authorities.[12] As a small thank you, Prokhorov hosted the Russian prime minister (the two are reportedly super best friends) at his $30 million French chalet – this time the police were kind enough not to interrupt the revelry.[13]
We should hope that the Nets do not end up like some of Prokhorov’s other investments. RUSAL, a Russian aluminum giant in which Prokhorov holds a large share, may or may not have attempted to assassinate a foreign journalist last fall. John Helmer, an Australian correspondent based in Russia, recently dodged three armed men who were arrested outside his Moscow home.[14] The men possessed a dossier containing photographs of Helmer and his wife, a floor plan of his apartment, and a document with the name “RUSAL” stenciled in the top corner. Helmer had written articles critical of RUSAL and other powerful Russian businesses.
In any case, Ratner and Prokhorov will make a great team. The NBA is expected to accept Prokhorov’s bid for the Nets, and owners of Brooklyn’s multi-million dollar penthouses are battling to house the charismatic Russian industrialist.[15] Ratner, for his part, is hoping to soon begin construction on the long anticipated (by Ratner, not so much by Goldstein and his thousands of supporters) basketball arena.
It looks as though the “Brooklyn Nets” will soon become a reality, and all it took was a destroyed neighborhood, some hired goons, maybe a few suspicious backroom deals with corrupt politicians, an alignment with a suspect Russian businessman with a colorful past, and the violation of rights purportedly protected by the U.S. Constitution. Bruce Ratner: what a guy.
[1] Leonard Greene, “‘Cuff’ Love Protest for Doomed Bar,” The New York Post, December 21, 2009.
[2] Mike Kelly, “Nets 1, residents of Atlantic Yards 0,” The Record (Bergen County, NJ), November 29, 2009.
[3] John Del Signore, “Is ACORN’s Atlantic Yards Connection the Real Scandal?” Gothamist, September 21, 2009.
[4] John Fund, “More ACORN voter fraud comes to light,” The Wall Street Journal, May 9, 2009.
[5] Stephanie Strom, “Funds Misappropriated At 2 Nonprofit Groups,” The New York Times, July 9, 2008.
[6] Scott Shane, “A Political Gadfly Lampoons Left via YouTube,” The New York Times, September 19, 2009.
[7] Rich Calder, “Group can $core on Atl. Yards,” The New York Post, September 21, 2009.
[8] Robert Gearty and Greg Smith, “Yonkers Pol Took Bribe to OK Ratner Deal, Feds Say,” Daily News (New York), January 7, 2010.
[9] Ibid.
[10] “Key Steps for NJ Nets arena plan,” Edmonton Journal, December 24, 2009.
[11] Yossi Melman, “Ex-Shin Bet, KGB Double Agent Shot Dead in Moscow,” Haaretz, November 4, 2009.
[12] Mark Franchetti, “France Finally Says Sorry for Seizing Billionaire Mikhail Prokhorov on Pimping Charges,” The Sunday Times (London), January 3, 2010.
[13] Emily Smith, “Nets Owner Hosting Pal Putin,” The New York Post, January 4, 2010.
[14] Peter Wilson, “Tip-Off Saves Australian Journalist from Moscow Plot,” Weekend Australian, January 9, 2010.
[15] Rich Calder, “Owners ‘Russian’ to sell,” The New York Post, November 2, 2009.