Five years of the Barclays Center

Today marks the five year anniversary of Barclays Center opening on Atlantic Avenue in Brooklyn. The venue has been a source of controversy, debate, and everything else since its conception. Here, we’re going to take a look at the history of the construction of the arena, its effects on the Brooklyn community, and what to expect as the years go on.

I. Jersey days

Back in 1998, the New Jersey Nets were looking for new ownership. The ownership group, known as the Secaucus Seven, had been in power since the early 1980s and, with a lockout on the horizon, were looking for a way out. They wound up selling to New Jersey businessmen Lewis Katz and Fred Chambers.

Katz and Chambers ran the Nets as they had their most successful run since they joined the NBA in 1978. Fresh off their second straight trip to the NBA Finals in 2003, the owners set in motion a move that would permanently change the franchise. Katz and Chambers had been looking for a new arena to replace the Continental Airlines Arena since the summer of 1998, but they didn’t have any luck. There was a push to keep the Nets in Jersey with a new arena in Newark that would host the Nets and Devils, but that fell short.

Community dynamics also played a part in a move to Newark failing, as political consultant Rick Thigpen explained to the New York Times in 2004:

''White New Jerseyans did not want to come to Newark for sports events, and they didn't want to spend public money to help keep teams in the state. Because of the public opinion polls and the racially distinct viewpoints, it has had a significant political impact on the governor's behavior. And it has tied the state's hands on putting public money into the effort.''

With Newark unlikely as a permanent home, the window opened for Bruce Ratner. A real estate magnate, Ratner was able to secure the support of local politicians for an arena (as well as promised housing, offices, and even a hotel) on Atlantic Avenue and officially purchased the team in 2004.

He was able to beat out another bid from then New Jersey Senator Jon Corzine and Charles Kushner, the real estate developer (who's also Jared Kushner’s father!). Ratner took over later that summer and went to work on Atlantic Yards. As for Katz, he left a lasting impression on the Nets and left them in good shape as they transitioned into a new era.

II. Getting started

Chang W. Lee of the New York Times.

Ratner's run as Nets owner got off to a catastrophic start. He didn’t have enough cash to complete the sale and had to provide the old ownership with a 20 percent stake in the team. At one point, the team had 100 people with ownership stakes.

Then, within weeks of taking over, he broke up the core of the team by trading Kenyon Martin to Denver as part of a cost cutting measure. He also had Rod Thorn sell the team’s first round pick for $3 million. Fans were angry and disappointed that a playoff team was broken up to cut costs.

Off the court, Ratner's focus was on the real estate. He told residents he wouldn't force them out of their homes and would instead work with them on fair deals. The overwhelming majority took the deal. As for the rest, about 35 residents and businesses, the state entered a prolonged battle with them over the land and how to use it.

III. The bailout

In 2008, everything came crashing down. The economy collapsed and plans for everything but the arena came crashing down with it. There was no financing for housing, but a loophole in the IRS regulations permitted operators of municipal arenas to get federal tax breaks, but steel had to be in the ground by the end of the year.

The grand plans for a 20,000 seat arena, designed by Frank Gehry and surrounded by four resident towers, had to be cancelled. Instead, Ratner borrowed the Pacers’ design for what’s now Bankers Life Field House, a more modest design. Ratner was in need of financial assistance in a hurry.

The then-68-year-old Ratner set out to sell part of the Nets. In June 2009, he took a meeting with Russian billionaire Mikhail Prokhorov in Moscow. Prokhorov had been looking to buy a team for a few years. Previously the owner of Europe’s most successful team, CSKA Moscow, he had been offered the Memphis Grizzlies and had inquired about the Knicks. He had the cash, having been forced (by Vladimir Putin) to sell out of his interests in a big nickel mining company. How much cash? Maybe as much as $9 billion!

By late September, a deal was in place. Prokhorov agreed to buy 80 percent of the Nets and 55 percent of the arena, by then dubbed Barclays Center, for $200 million in cash, the assumption of $160 million in debt, and an agreement to finance $60 million in basketball operations costs.

The team moved from one location in New Jersey, the now-shuttered IZOD Center, to Newark’s Prudential Center. Prokhorov paid a $4 million penalty to get the Nets out of the IZOD lease.

By May of 2010, after the worst season in NBA history, the deal closed following the final disposition of the residents’ lawsuits. They had taken the case to New York State’s highest court, the Court of Appeals, who ruled in favor of the state and Ratner.

IV. Grand Opening

New York Daily News archive

After nine years of delays, court dates, and just about everything else, the Barclays Center opened for business on September 28, 2012. Jay-Z opened the arena in style with nine consecutive shows that featured guest appearances from Big Daddy Kane, Fabolous, Beyonce, and others. The arena got rave reviews, as did the show. It didn’t hurt that Jay-Z owned a (tiny) piece of the Nets and the arena. He later sold his portion in 2013 so he could start his own sports agency.

Hurricane Sandy delayed the Nets home debut (which was going to be against the Knicks), but they officially moved in on November 2, 2012 against the Raptors. Since then, the arena has been home to the Nets as well as college graduation ceremonies, college basketball games, concerts, and other special events. Barclays has also managed to scoop up events that would usually go to rival Madison Square Garden, including the NBA Draft.

Even with the new arena, easy transportation access, and the luxury of playing in the country's biggest market, the Nets haven't had the financial success you would expect. Since the opening of the Barclays, here’s where the Nets have ranked in average attendance per game:

2012-2013: 16th

2013-2014: 17th

2014-2015: 20th

2015-2016: 27th

2016-2017: 28th

As you would imagine, the team has gotten worse each season and hasn’t made the playoffs since 2015. Brooklyn lost $44 million in the 2016-17 season a few years after losing $144 million in the 2013-14 season. If you don’t make deep playoff runs and wind up entering a rebuilding process, it’s going to affect you at the box office.

And for a team that is looking to gain fans from their crosstown neighbors in the Garden, the past two years have done a lot of damage to those efforts. Earlier this year, Prokhorov got approval from the NBA to sell a minority portion of the Nets, and if some reports are to be believed, might be looking to sell most of his stake in the team if the price is right. The NBA, say league insiders, would like to see Prokhorov include an equal share of Barclays Center in any deal.

V. New Neighbors

Brad Penner-USA TODAY Sports

In another part of the tri-state area, a local team had been having their own arena issues. Since the 1970s, the New York Islanders played at the Nassau Veterans Memorial Coliseum. The building was widely derided by fans and league observers as one of the worst arenas, if not THE worst, in sports. Seeking a newer arena, the Islanders spent much of the 2000s battling local politicians who did not want to build them a new arena (one part of a proposed Lighthouse project, which would have included housing as well).

With no new arena in sight, the Isles decided to come to the Barclays Center after the 2015 season. Over at Lighthouse Hockey, Les Mavus noted one big benefit the Isles would have in Brooklyn compared to the Nassau Coliseum:

The transportation to the game is simply fantastic. Anyone in the city can simply get on board the subway and take the 2, 3, 4, 5, B, D, N, Q, or R lines to the Atlantic Center. Those coming from New Jersey can take the PATH into World Trade Center for an additional two dollars, take a brief walk to the Fulton Street station and hop aboard the Lexington Line.

The Islanders have consistently been in the bottom third of the NHL in attendance since the turn of the millennium, finishing dead last five times. Since the move to Brooklyn? The Islanders have been in the bottom third of the NHL in attendance.

The move to Brooklyn hasn't been as successful as the Islanders would've liked, and they might be on the move again. It's not just that neither Brooklyn nor their old fans have taken to Barclays Center. There are issues with sightlines and poor ice.

So for the past several months, the Isles have been looking for a new, permanent home with Brooklyn Sports and Entertainment, Prokhorov's holding company, more than subtly suggesting they return to the newly renovated Coliseum. The NHL isn't buying — even if the downsized Coliseum upsizes a bit.

Most signs point to Belmont as their future home should they leave Brooklyn and it will be interesting to see where the relationship between the Islanders and the Barclays Center goes from here.

VI. The changing community

Throughout the push to build the new arena and since Barclays has been open for business, members of the community have been involved in the process.

Many (some?) residents felt (and continue to feel) that the arena would be more trouble than it is worth and would negatively change the tenor of the community. Some residents feared (and continue to feel) that the Barclays Center is just one more sign of the gentrification that has swept Brooklyn and the city as a whole.

The community has already seen the demographics start to change and it's likely that these changes will continue. As Brooklyn continues to evolve, the clash between the neighborhood culture already in place and the hip new residents (and businesses) evolves as well. Older residents move away and newer ones reshape the neighborhood. That will continue.

As part of having an arena that hosts major events every day, a lot of traffic surrounds the area. Unfortunately, that traffic brings a lot of problems ... although fewer than had been anticipated. New Jersey fans didn't follow the team from Newark. That meant fewer cars.

Still, there's a lot of anecdotal evidence of disruption and worse...

From a Michael O’Keefe’s report in the New York Daily News in April 2016:

The assault by the three drunken boxing fans wasn’t Elicia Howard’s first disturbing Atlantic Yards incident. She had put up with catcalls and lewd comments from construction workers for months, including one smitten hardhat who followed her around the neighborhood like a lovesick puppy and once drew a heart in the dust on her car. She’s witnessed ugly confrontations between neighborhood residents and sports fans. Hockey fans especially seem dismissive of the black and Latino residents who live near the arena. Howard says she saw a group of men wearing Rangers jerseys curse out members of a predominantly African-American church before an Isles-Rangers game at the Barclays Center earlier this year because the parishioners told them they couldn’t park their Mercedes SUV in a no-parking zone.

This is one major issue that arises when you have a large arena like Barclays plopped down in a neighborhood: Residents feel strangers who don’t care much about the people already living in the neighborhood barge in, disrespect the culture that's been created, and overrun the locals.

The Barclays Center hopes to create a plan to manage disruptive fans exiting their arena, but it shouldn’t take security for arena patrons to show basic decency and recognize the humanity of the people who already live in the community. (It's less an issue for those attending Nets games, compared to their more rowdy counterparts)

VII. “Affordable”

If you've spent some time thinking about housing in New York, you know that it's practically hell on earth finding a good place to live and having a landlord that won’t try to squeeze you.

There have been many attempts to address the issues surrounding housing in recent years, but they haven't made much of a dent or adequately addressed the problem. The city is getting more expensive and with wages not catching up to rents, people have had to scratch and claw just to find somewhere decent to live. Housing for those without huge incomes is scarce and more units are needed to help accommodate the rising demand.

As part of Ratner's agreement to build Barclays Center, he promised to build affordable housing units for local residents. (He didn’t get off to a particularly good start when a local homeless shelter was moved to make way for development in 2010.)

In recent years, developers including Ratner have sought to build affordable housing units near the arena, but haven't accomplished much. There have been a few lotteries for low income New Yorkers seeking apartments near the Center, but those lotteries are incredibly difficult to win and winners tend to be young and single. There was a troubling report about the prices of some available apartments, and if the prices don’t come down, low income New Yorkers won’t be able to get close to those buildings.

Combine all of that with a mayor who's been criticized for not working to provide enough housing for low income New Yorkers (along with a change of view and a change in law regarding affordable housing). You've got all the makings of a crisis.

VIII. What the future holds

Photo by Stephanie Keith/Getty Images

For the Nets, they have been working to increase their presence in the city. Players have been more involved with the community and the team even chipped in to help preserve a mural that means a lot to Brooklyn. It’s also led to a reported increase in ticket sales. Those are great first steps, but the Nets have a lot more work to do in making a long lasting imprint with basketball fans in the city.

For the Pacific Park group, time is running out. The rate of construction in the area surrounding Barclays has gone incredibly slowly and if they don’t create at least 2,250 affordable housing units by 2025, they face a $5 million fine from New York State. That was part of the original deal. With the housing situation the way it is in the city, if they’re able to reach their goal and create affordable housing for low income New Yorkers, it can have a long lasting effect on the borough.

The biggest issue surrounding the team and the arena will be Prokhorov’s status going forward. As the owner of the Nets and Barclays Center, his decision to sell or not sell will have long-term ramifications for the team and the site.

If he does sell, will he give up ownership of the arena in addition to the team or will he try to hang on to one instead of the other? The league isn't likely to go along with that.

What he does and who is selected to be a new owner of the franchise will shape what the team looks like, how they make use of their resources, AND how they approach the community. Prokhorov has said he'd prefer to sell to local investors, but there have been rumors of interest from as far away as Qatar and Taiwan.

For over a decade, Barclays Center has been one of the most divisive issues in Brooklyn. Proponents of the arena cite Barclays bringing professional sports back to the borough as well major family events and concerts. Its opponents believe that those positives outweigh the lack of progress made on the housing Ratner promised as well as the gentrification it has wrought.

One thing is certain, Barclays Center has become a symbol of the new Brooklyn... with all that it entails.