By George Capsis
On Wednesday October 20, The New York Times ran an article outlining a plan to save the corroding, 15-acre Pier 40 by accepting $100 million from two real estate investment firms for the Pier’s air rights, allowing them to build 1,586 apartments, a hotel, and retail stores in five buildings facing Pier 40 on the lot on which the three-block-long St. John’s Terminal now stands.
My first question was who placed this article in the Times—who was trying to sell us this deal? Was it Madelyn Wils for the Hudson River Park or was it City Planning, demonstrating they were adding to the 200,000 affordable apartments De Blasio has promised, or was it the two multi-billion dollar real estate investment firms writing out the $100 million check to get tens of thousands of relatively cheap footage that might have cost them an unprecedented $1,363 per square foot?
I called the Times author, Marc Santora and he didn’t know—his editor had him finish the article since they were “backed up” and while he did some “fact checking” most of the content came from either Charlie Bagli who wrote pretty much the same story back in May 2014 or Lisa Foderaro. I called Lisa and got her voice mail, so I started this piece without the benefit of knowing who and how this story was fed to the Times, but fed to the Times it was. I mean I spent eight years in Corporate Communications at IBM so I know when a story is PR manicured and spoon fed to the Times. Knowing who called the Times was key to knowing how real the story was.
The release offered that “Thirty percent of the proposed 1586 units (apartments) would be a mix of low-income, moderate income and senior housing” and that the seniors would be in a building all by themselves so they could have support services like a medical office and a dining room. I mean, this is far in excess of the usual deal the city extracts from a developer who wants to build more square feet than he is legally allowed to build.
Under Bloomberg, developers got real estate tax abatements for a number of years in return for offering 20% of the units at “affordable” rents. Under De Blasio it was discovered that the City could build a lot more affordable apartments for the tax money they were giving the developers, so now they ask for 30% affordable apartments and sometimes even more.
Corey Johnson, our City Councilman, is getting a lot of credit for the remarkable concessions. I wanted to confirm that credit but none of the principal negotiators were willing to talk (both real estate firms in the deal chose not to return my repeated calls) and I could only talk to a 27-year-old press blocker in the Mayor’s office, so I could not faithfully recreate how the deal went. I mean, did the hard-shelled Jeff Goldberger of Atlas Capital Group, who seems to have spoken for the partner firm Westbrook Partners, offer the 30% deal to get more square feet or did Carl Weisbrod, Head of City Planning, or Alicia Glen, the Deputy Mayor for Housing and Economic Development, suggest it to get even more precious affordable housing?
I initially surmised that the 30% “affordable” apartments will be on the lower floors on the East side of the building facing a shabby collection of large commercial buildings with maybe a separate entrance for the below market rate rabble. I have been assured that this is not the case, that no poor door will exist and the distribution of units will be part of the public review process.
Yes well, this is the second time they have tried something like this.
The first time, in 2014, the $100 million check was coming from real estate investor Michael Novogratz, who was at that time a partner with Westbrook and Atlas—but the deal was done in such nasty secrecy that the stuff hit the fan. Novogratz dropped out and then was bought out for $200 million (perhaps for his lack of negotiating finesse) by fellow real estate investment firms Westbrook and Atlas. The same firms that now offer the same $100 million check to the park, while Novogratz still appears as the head of Friends of Hudson River Park (some friend).
The Times article is all over the place with snippets of familiar whines from Madelyn Wils, the head of the Hudson River Parks Trust. Wils—who has through her managerial skills allowed the park to slip into losing $1.6 million a year.
Right now there is no way the park can prevent the bureaucratic equivalent of bankruptcy hence the secretive wee hours of the morning passage of a bill to allow her to sell the air rights of a pier—not a building but a pier built over water. And allowing one of the highest luxury condos in the Village to be built at 430 feet, the same height limit allowed in Hudson Square.
One of the reasons given to take this money is that, according to a “recent study” the 3,500 steel piles of Pier 40 are corroding. This is an example PR hype. The steel piles have been corroding since 1971 when the Port Authority turned off the electrical cathodic system that prevents pile corrosion in salt water. Not telling the truth is not the way to make us West Villagers buy letting Westbrook and Atlas build 1.7 million square feet of floor space.
OK, both attorney Arthur Schwartz (who sued the city to build the Astro-turf athletic fields after the last failed RFP) and Councilman Corey Johnson plead that if we don’t sell the air rights to these two real estate firms now known as St. John’s Center Partners, they will build a monster building complex anyway. This way we get 30% of the 1,586 apartments or 476 units for “permanent affordable housing including low income moderate income and senior housing” and half of those apartments will be held for current residents of the CB2 district.
Hmm, yes, well. While I was working on this article yesterday our photographer, Maggie B came by to take the photo of the Sinclair Lewis apartment in this issue and asked if I had seen the ad in the Times Magazine touting “The Shepard” a 19th century warehouse being renovated on 10th Street with apartments starting at $4,350.000 (no wonder they can afford inserting a fat, glossy, full color ad in the magazine).
I thought with the 100 luxury co-ops of the Rudin replacement for St. Vincent’s and the 90 apartments currently being occupied by big spenders like Bon Jovi at 150 Charles Street and now with more than 1000 luxury apartments in this new Emerald City on the Hudson—we are being surrounded by a new generation of Villagers who can afford some of the most expensive apartments in the world.
And soon they will be the majority voters at the Community Board meetings asking to end rent stabilizations so their kids graduating from Ivy League colleges can move into those nice quaint brown stone apartments currently occupied by little old Villagers on Social Security.