Breaking News: Prokhorov/Ratner Sign Letter of Intent to Partner on Atlantic Yards Development

Posted on: September 23rd, 2009 by Mark Ginocchio Comments

russia-mapForest City Ratner Companies and Russian oligarch Mikhail Prokhorov's Onexim Group announced today that they have agreed to sign a letter of intent to create a strategic partnership to develop the Atlantic Yards in Brooklyn, the proposed future home of the Barclays Arena and the Nets (AP via SI).

Here are some details from a Forest City Ratner Enterprise press release on the Nets home page:

In accordance with the agreement, entities to be formed by Onexim Group will invest $200 million and make certain contingent funding commitments to acquire 45% of the arena project and 80% of the NBA team, and the right to purchase up to 20% of the Atlantic Yards Development Company, which will develop the non-arena real estate.

Bruce Ratner, the Chairman and CEO of FCRC, said, “Mikhail and Onexim will be great partners for this project. I am thrilled that smart global investors appreciate the exciting economic potential of Brooklyn. We are one step closer to achieving our goals of creating much needed jobs and economic development for Brooklyn and the city.”Mikhail Prokhorov, President of Onexim Group, said “We are delighted to join in this exciting project and to participate in the landmark development of global sports in this entertainment arena in the heart of New York City. I have a long-standing passion for basketball and pursuing interests that forward the development of the sport in Russia. I look forward to becoming a member of the NBA and working with Bruce and his talented team to bring the Nets to Brooklyn.”

NBA Commissioner David Stern said, "We are looking forward to the Nets' move to a state-of-the-art facility in Brooklyn, with its rich sports heritage. Interest in basketball and the NBA is growing rapidly on a global basis and we are especially encouraged by Mr. Prokhorov's commitment to the Nets and the opportunity it presents to continue the growth of basketball in Russia."

Develop Don't Destroy Brooklyn, one of the primary opponents of the deal has issued their own statement via spokesman Daniel Goldstein:

"This has got to be a huge wake-up call for Ratner's political supporters. The only reason Ratner would make this deal is because he is in dire financial trouble. If Ratner has to go overseas to get major funding for the arena, how on earth is he going to finance the rest of the project?"

The deal would have to be approved by the NBA's board of govenors, according to the AP.

Well folks, this is pretty huge. We'll see where things legally stand once the Oct. 14 hearing in Albany regarding the use of eminent domain for the project passes, but considering it's only been about a week since the "richest man in Russia" was linked to the Nets and this deal was announced, things are clearly moving at an accelerated pace with the end of the year still being the supposed finish line for Brooklyn to happen.