In a joint statement, FCRC, Nets Sports and Entertainment and Onexim say that entities to be formed by Onexim will invest $200 million and make "certain contingent funding commitments" to acquire 45% of the arena project and 80% of the NBA team. Onexim will also have the right to purchase up to 20% of the Atlantic Yards Development Co., which will develop the non-arena real estate that comprises the majority of the $4.9-billion, 22-acre mixed-use project.

Commenting that Onexim and Prokhorov "will be great partners for this project," FCRC chairman and CEO Bruce Ratner says in a release that he's "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."

For his part, Prokhorov notes in the release that he has "a longstanding 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."

A blog post attributed to Prokhorov and translated on the website of Develop Don't Destroy Brooklyn suggests that the Russian investor's primary interest in the deal is in using NBA technology "for the systematic development of basketball in Russia." Prokhorov is part owner of the CKSA basketball team in his native country, and the blog post observes that "there has never been a foreign owner of an NBA club."

The FCRC/Onexim agreement, which was reported on various media outlets earlier this week prior to Wednesday's official announcement, is expected to close by the first quarter of next year, pending approval by the NBA's board of governors. NBA commissioner David Stern says in the release that "we are looking forward to the Nets' move to a state-of-the-art facility in Brooklyn, with its rich sports heritage."

Meanwhile, the project faces a December deadline to break ground on the arena or jeopardize the tax-exempt status of the bonds. Ratner alluded to this timeframe in a statement issued last week after the Empire State Development Corp. approved the modified design for the Barclays Center. "We now need to work aggressively to break ground by the end of the year," he said in last week's statement. "We look forward to achieving these goals."

It also faces an Oct. 14 hearing before the state's highest court, the Court of Appeals, over a challenge to the May 15 ruling that upheld the ESDC's use of eminent domain on Atlantic Yards. Both sides have expressed confidence that they will prevail in court; however, a release issued by DDDB on Wednesday warns that "more lawsuits against the project are expected from the community's opposition to the project."

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.

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