March 27, 2005

Friends in high places, cont'd

With the Metropolitan Transportation Authority board just four days away from a possible vote on the New York Jets-vs.-Cablevision bidding war for its West Side rail yards site, accusations are flying about just who bid what and why. The latest allegations came in an article yesterday by New York Times reporter Charles Bagli, who said that three unnamed members of the Jets' team of developers offering $440 million for the site's air rights (thus enabling the team to up its total bid to $720 million) say they believe they were recruited at the behest of the New York mayor's office.

"Basically, the city came up with the idea," said one of the developers, who asked for anonymity because he did not want to antagonize the Bloomberg administration. "I think they went to [city Real Estate Board president Stephen] Spinola, and Spinola contacted some people and said, 'Would you be interested?'"

Spinola insisted the air-rights gambit was all his idea, but that didn't stop U.S. Rep. Anthony Weiner, one of Mayor Michael Bloomberg's opponents in this year's mayoral race, from calling for an investigation into the mayor's role, and for the MTA to delay a decision on the winning bid. A mayoral spokesperson retaliated by calling Weiner "a Cablevision shill desperate to justify his anti-job positions" - which you have to imagine won't have much of an impact, given what the future Congressman undoubtedly got called as a kid.

Meanwhile, it was revealed on Friday that Cablevision has raised its own bid to $760 million, or $40 million more than the Jets' total bid. It's not an apples-to-apples comparison, though: $350 million of Cablevision's bid is earmarked to deck over the rail yards (under the Jets plan, the city and state would pay for this); while $440 million of the Jets bid would be from that conditional sale of air rights. Further complicating matters is that the air-rights sale might not even be a legal bid by the MTA's own bidding rules, according to Bagli, who notes:

The proposal is contingent on the city reworking its zoning regulations. And the authority's requirements assert that "no proposal that is contingent upon a change in existing zoning requirements will be considered."

Whoops. Maybe Spinola should have read the fine print before he had his brainstorm.

In any case, complications like these make it awfully likely that no matter who the MTA picks as a winner, the loser will immediately file a lawsuit to overturn the decision. Which means that no matter what the Jets say, their lawyer was right: There's no way this stadium gets underway before the 2012 Olympic host is picked in July. And the way things are looking, it ain't gonna be New York.

LATE NOTE: I somehow missed this one until an alert reader pointed me to it: The New York Post is reporting that Newmark & Company, the Olympic committee donors hired by the MTA to help evaluate the bids, believes they're all way too low. Once the site is rezoned for high-rise development - as both the Jets and Cablevision bids would require - it should be worth $200 a square foot, says Newmark, which would make the entire parcel worth a cool billion dollars. Newmark's evaluation, according to the Post, could lead the MTA board to reject all the current offers and wait for another round of bidding; as one MTA board member told the paper: "Just because it's a bid doesn't mean we will get a realistic price. If not, I wouldn't sell it."