A New Generation Of The Ratner Family Is Ready To Build Its Own CRE Legacy

The Ratners are back.

Five years after the sale of their influential family business, Forest City Realty Trust, to Brookfield for $11.4B, brothers Kevin and Jon Ratner, along with business partner Luke Palmisano, are set to open five new apartment projects across the U.S. in the next 12 months.

The first project of their new company, named Max Collaborative after their grandfather, Forest City co-founder Max Ratner, is a head-turning collision of nature with glass and steel.

With its facade cracked open to reveal veins of greenery flowing to a rooftop garden amid Denver’s famously gritty River North district, the project is an aesthetic disruption from the norm and a statement about how the company plans to forge its own path. 

“There’s going to be value inherent to building a better product and enduring some of the challenges that come with trying to disrupt a system that wants to be just kind of routinized,” Jon told Bisnow. 

One River North, as the Denver development is known, is scheduled to open this month. Beijing-based MAD Architects and Denver's Davis Partnership Architects designed the building.

The 16-story, 187-unit project’s splashy green features spotlight two things Max Collaborative intends to make its calling cards: a heavy emphasis on sustainability and unique, engaging design.

“It’s a very prominent site, so we felt like a prominent building on that site could really add to delivering value,” Jon said. “We, throughout our history, have always invested in architecture and tried to take time to craft really the best building that we can.”

The tower is part of a $750M development pipeline with projects underway in Los Angeles, elsewhere in greater Denver and in the family’s hometown near Cleveland.

Max Collaborative is ready to build on 100 years of commercial real estate legacy, but it isn’t out to replicate Forest City.

“I don’t think any of us feel pressure to live up to any expectations,” Jon said. “We enjoy what we do. It sounds a little trite, perhaps, but we take great pleasure in designing and executing great real estate that is going to benefit the communities.” 

Forest City was founded in Ohio in 1920 and became one of the largest developers in the country, eventually collecting more than $8B in assets under management. Kevin and Jon came up in the family business and ended their tenures as president overseeing Los Angeles and vice president of sustainability, respectively.

The company developed all over the U.S. but is best known in most places for its development of New York City’s Barclays Center in 2012, along with several other projects in Brooklyn.

Bruce Ratner, Kevin and Jon’s cousin and a onetime part owner of the Brooklyn Nets, went big on Brooklyn, launching the borough’s megadevelopment now called Pacific Park in 2003. At the time, the proposal was the largest public-private real estate development in NYC in more than 20 years, The Real Deal reported. As proposed, it was to have 4,500 apartments and 2.1M SF of commercial space on Atlantic Avenue.

Ultimately, only a handful of the buildings were completed by the time Bruce retired and Forest City was sold. Nevertheless, he made his mark on the city, developing what is now known as Brooklyn Commons and the Atlantic Center and Atlantic Terminal malls.

Forest City sold to Brookfield in late 2018 after a tumultuous few months. Activist investors agitated for the family to relax its control over the company and ultimately to sell. Forest City’s board narrowly approved the sale over the objections of Albert Ratner, another cousin and the CEO of Forest City for 20 years.

But the connections forged during Forest City’s run planted the seeds for the developments Max Collaborative is undertaking today.

Apart from One River North, Max Collaborative is a development partner on a project in the Denver suburb of Aurora and one in Denver’s Sloan Lake neighborhood. The Sloan Lake project, called The Wilder, is a collaboration with Denver-based Nava Real Estate Development, known in the area for its commitment to the health and wellness of tenants in its buildings.

Nava was co-founded by Brian Levitt, a former Forest City employee who worked with Jon on the master-planned redevelopment of the Stapleton International Airport on the east side of Denver. Forest City was brought on to oversee the redevelopment of 4,000 acres of decommissioned airport property in a deal completed in 2000.  

“[Jon] showed me kind of the way in terms of green, and I converted that into costs and benefits that we explained to his father, who was the CEO of Forest City at the time, and then we ultimately developed Northfield, the first LEED-certified main street mall in America,” Levitt said.

That green perspective isn’t common in the development community, according to Levitt.

“There’s an alignment, which is unusual. Not many owners care about the environment, let alone prioritize it as a development strategy,” he said. “With Kevin and Jon, it’s a priority.”

Forest City’s role in the development work on the Denver neighborhood now known as Central Park continued until 2018 when the community was almost entirely built out and the company sold.

Kevin, meanwhile, worked on developments in California on behalf of Forest City, building the foundation for A34, a 467-unit Los Angeles apartment project scheduled to deliver within the next year. A34 sits on 5 acres near the Heritage Square light rail stop in the Lincoln Heights neighborhood, and 14% of the units will be available to those making 50% or less of the area median income, Kevin said.

Closer to home, in Shaker Heights, Ohio, Max Collaborative is working on the second phase of its Van Aken project, a 16-story apartment development. The first phase of Van Aken included office and retail space in addition to multifamily and was completed in 2018 as Forest City neared its sale. It was designed to serve as a downtown main street, something that was missing from the original planning for the area.

The new units in the Max Collaborative pipeline are a drop in a coming tidal wave of new apartment supply expected to come online across the country this year and early next. Roughly 900,000 units are under construction nationwide, and 440,000 of those are expected to deliver in 2024, according to a February report from CBRE. Rent growth is slowing — and, in some cases, turning negative — in response.

Kevin and Jon both acknowledge that the multifamily market has a rocky road ahead, at least relative to the smooth ride it experienced since the Global Financial Crisis, apart from the pothole created by the early days of the pandemic.

They said they’re ready for it.

“One of the curses of Forest City was it was such a big organization, it was constantly needing to put more deals to the top of the funnel to keep the whole machine going,” Jon said. “We don’t find ourselves in that space. We can be patient. We can wait it out. We want to be opportunistic.”

They also intend to continue prioritizing sustainability, even as construction costs rise, making the entire prospect of development inherently riskier.

“To have that sort of impact on the built environment and to have that ability to have that impact on a city is both something that is very enticing and a lot of fun, but comes with a lot of responsibility and with a lot of risk,” Kevin said.