Nov. 23 (Bloomberg) -- I’m standing on the roof of a building in the New York borough of Brooklyn that offers a panorama of rusting rail yards and several empty commercial buildings and row houses. This could become the $800 million Barclays Center arena.

The view may not change soon, however, given the legal and financial hurdles the ill-starred project still faces.

If all goes well, the arena will be the new home for the National Basketball Association’s New Jersey Nets and part of the 22-acre Atlantic Yards commercial and residential development that once comprised 16 towers under the master plan of architect Frank Gehry.

Much has gone awry so far. The local activist group Develop Don’t Destroy Brooklyn has filed a suit that argues against the use of eminent domain. The family of the group’s spokesman, Daniel Goldstein, faces eviction because they are the last occupants of an eight-story building located where the basketball court would be.

Another suit claims that some changes made to the original project by developer Forest City Ratner Cos. under Chief Executive Officer Bruce C. Ratner are significant enough to require additional environmental review.

If the judge in either case rules for the plaintiff, the resultant delay would make it almost impossible for Ratner to obtain financing through tax-exempt bonds that must be issued before the end of the year. An adverse ruling in either case also would give Barclays Plc the right to withdraw from a deal in which it would provide $400 million for naming rights on the arena.

“We expect the bond process to proceed by the end of year,” said Joe DePlasco, Forest City Ratner spokesman. “We’re waiting for the rating agencies.”

Rulings and Limbo

Court rulings could come as early as this week and will likely determine whether the development moves forward or sinks into limbo.

The project has already changed drastically for the worse. It was once a glittering Gehry blueprint that would have covered the rail yards with a glass-walled arena and sprouted 16 towers wrapped in fluttering ribbons of metal and glass.

As the climate for property development went frigid, Ratner dumped Gehry and brought in a sports-design specialist, the San Francisco office of architect/engineer Ellerbe Becket Co., which was recently bought by design giant AECOM Technology Corp.

When images of the revised arena project -- a bloated, brown airplane hangar -- were greeted with revulsion, Forest City Ratner disavowed them. The developer hastily married Manhattan-based SHoP Architects with Ellerbe Becket. SHoP wrapped the brown blight in a pelt the color of rusting steel. The gambit got the arena cost down to $800 million from $1 billion, according to Forest City Ratner.

Hack Expediency

The result still smacks of hack expediency. One of SHoP’s overlapping metal bands thins as it arches into a broad porch over a bleak plaza, where Gehry had planned to build a high, glass-walled public space. Instead we would have a toad hunkering at one of the most important intersections in Brooklyn, that of Flatbush and Atlantic avenues.

Fans would stand soaking on the plaza on rainy days. The broad cineplex-look entry awkwardly squeezes into a much tighter gathering space and concourse. The secondary entrances have shrunk to the size of subway holes.

The spacious yet largely useless plaza and the beaklike porch occupy land slated in the Gehry plan for an iconic commercial tower once dubbed Miss Brooklyn. Ratner has promised the tower will be built. That means lopping off the beak, which would destroy what little integrity the design possesses.

Environmental Review

Ratner must insist on the tower’s eventual presence - even if he cancels it later -- because giving it up now means redoing the environmental review, as Develop Don’t Destroy Brooklyn seeks, costing him the favorable financing.

In the surreal morass of legalities under which state-owned rail yards become the setting for heavily subsidized private development, city and state officials have endorsed the design, yet state bonds have yet to be offered.

Ratner raised $200 million by selling 45 percent of the Barclays Center and 80 percent of the Nets to Mikhail Prokhorov, the basketball-obsessed Russian billionaire.

Gehry’s 2005 master plan was flamboyant and untidy, leaving important issues, like traffic, not fully addressed. But it injected tremendous energy into downtown Brooklyn, while subtly weaving together areas long divided by the sunken rail yards.

Ratner blames not-in-my-backyard delays and the real-estate meltdown, but he shouldn’t have been surprised. Protesting neighbors are predictable -- they now correctly fear that empty buildings and cracked asphalt parking lots will blight the neighborhood for years. They suspect affordable housing backloaded in the project will never be built.

Yes, the economy tanked, but Ratner had to figure that New York would boom and bust in the course of his project, as it repeatedly has.

Brooklyn might have been proud of the Gehry arena. Swapping it for a life-sucking eyesore suggests that Ratner won’t keep any promises that prove inconvenient.

(James S. Russell is Bloomberg’s U.S. architecture critic. The opinions expressed are his own.)

To contact the writer of this column: James S. Russell in New York at jamesrussell@earthlink.net.

Last Updated: November 23, 2009 00:01 EST