De Niro Loses Part in Studio Project

Robert De Niro may be used to getting his way in the movies, but a partnership that included the actor’s film company has been muscled out of the project to create a $150-million studio--with 12 sound stages--on the site of the defunct Brooklyn Navy Yard.

City and Navy Yard officials announced Wednesday that they had awarded the project instead to New York Studios, a group formed by two young businessmen who originally proposed using the historic waterfront property for movie-making.

New York Mayor Rudolph Giuliani said the move was prompted by financial and legal considerations, including the expected receipt of $60 million more in revenue from the New York Studios partnership.

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But there were grumblings among the losing players that New York politics were at play as well, stemming from Giuliani’s expected U.S. Senate race against Hillary Clinton.

Jane Rosenthal, De Niro’s partner in the Manhattan-based Tribeca Productions film company, hosted a Democratic Party fund-raiser at her Hamptons home this summer featuring the first lady and President Clinton. Another backer of the De Niro partnership was Miramax Films co-Chairman Harvey Weinstein, a longtime supporter of Hillary Clinton’s who just weeks ago held a fund-raiser for her Senate exploratory committee. The Giuliani administration earlier this year refused to allow Miramax to use the Navy Yard for the glitzy debut party for Talk magazine--the first issue of which had Clinton on the cover.

A spokesman for De Niro’s company said Wednesday that the actor’s partnership was “surprised and perplexed” by the city’s decision and that a formal response was being prepared.

It was just five months ago that Giuliani joined De Niro and Weinstein for a festive news conference at the Brooklyn Navy Yard--in the cavernous building where the battleship USS Missouri was built--to trumpet the plan for a cluster of sound stages that would draw movie production work away from Hollywood.

The deal then on the table called for Tribeca Productions to put together the project with a local real estate developer, Vornado Realty Trust, assisted by a $25-million loan from the city. Weinstein, who said he hoped to use the facility where feasible for Miramax’s filming and post-production work, predicted it would “have a major impact on movie-making around the world.” And Giuliani joked that the characters in Miramax’s Oscar-winning “Shakespeare in Love” would have had Brooklyn accents had the studio been built.

On Wednesday, however, Giuliani said that the board responsible for finding uses for the Navy Yard--which was decommissioned in 1966--had decided that the rival New York Studios group “would bring about $60 million more in revenue, that it was a more realistic deal, that they could start faster . . . and they did not require a $25-million loan.”

The mayor noted that he had been careful in May to say only that the city “would explore an arrangement” with the De Niro partnership. “There was no agreement with them,” Giuliani said.

He said the city would have faced a lawsuit if it had not given the high-profile project to New York Studios, a venture launched by two entrepreneurs already operating businesses--an Internet company and set-design firm--elsewhere on the 264-acre Navy Yard site. Lou Madigan and Cary Hart had signed a 70-year lease with Navy Yard Development Corp., but had a hard time finding financing--leading to the entry of De Niro and his group.

“All the financing is in place,” a jubilant Madigan said Wednesday, citing the backing of the Steiner Equity Group, a New Jersey-based real estate developer.

“We’re still open to working with Miramax and De Niro and a lot of people,” Madigan said. “But the project’s moving ahead.”

Marc Rosenbaum, president and chief executive of Navy Yard Development, said New York Studios was picked both for financial reasons and “to get this thing underway.” The group will begin testing the site “within a week,” he said, and “begin construction within 120 days . . . It was time to move on and get studios built.”

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Although the New York area has a series of smaller studios, used by soap operas, assorted film projects and TV shows such as “Spin City,” the mayor’s film office has said there is need for a “critical mass of big sound stages” and post-production facilities that can support Hollywood-scale movies and TV series.

It now may take some major diplomacy, however, to get the business of the area’s most significant movie producer--Miramax--or of De Niro’s company.

“I would say that the probability of their involvement in the project would be less than zero,” said one friend of the De Niro group. “The mayor trots out Harvey Weinstein and Robert De Niro to salvage a project, as the white knights . . . and for whatever reasons, [he’s] taken a different course now.”