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Written by BrianP

TWO TREES’ DOMINO COMES TO CITY HALL

ISSUES REMAIN UNRESOLVED, PROMISES STILL HOLLOW

With the affordable housing still not locked in, affordability levels still unclear, the open space in semi-private control, and a total lack of details or economic development planning for the commercial and retail space,  Two Trees’ Domino project remains highly problematic.

two trees currentAlmost four years ago, I was City Hall in June, 2010 when two competing rallies were held on the steps. The first was led by City Councilmember Diana Reyna and Southside community groups Los Sures, El Puente, and Churches United and included a few dozen Southside community members clad in yellow “Domi-Yes” T-Shirts, supporting the development for its promise of 660 units of affordable housing. The “Domi-Yes” group then filed into the chambers and occupied most of the first level of seating with their unified yellow-shirted bodies. The second rally was led by Councilmember Steve Levin and then Assemblyman Vito Lopez and consisted of slightly larger group chanting “Too Tall, Too Dense, A Super-Size Domino Makes No Sense.”

In the end, Mayor Bloomberg and Speaker Quinn supported the development and “The New Domino” was approved with only minor reductions in building height conceded to the “Too Tall, Too Dense” crowd.

There is absolutely no question that “The New Domino” would have never been approved without the political support of the “Domi-Yes” group, who were under the full impression that their advocacy would lead to 660 units of affordable housing, with many units available to very low-income families and seniors.

Of course, as I’ve covered many times here, the 2010 promises were memorialized in a non-binding “Memorandum of Understanding” and only the standard inclusionary zoning deal allocating 20% of floor area to affordable housing was written into law.

Now in 2014, as Two Trees’ proposal arrives at City Council review, we are again faced with the problem of non-binding affordable housing promises, despite the recent celebratory announcement of a deal between Two Trees and the De Blasio administration.

Here’s a comparative table comparing Two Trees’ current proposal, post- De Blasio City Planning Commission, with the 2010 Project.

2010 “New Domino”

Two Trees Proposal 3/31/2014

Residential SF

2,381,510

2,215,510

Residential Units

2,200

2,282

Affordable Housing

Promised 660 affordable apartments  as 30% of total number of units, but in the final zoning, only 20% of floor area (approximately 502,000) was locked in.

Promised 100 units at 30% AMI, 100 senior units at 50% AMI, 310 at 60% AMI, and 150 homeownership units at 120% AMI.

Promised significant number of two and three bedroom units.

Deal with De Blasio administration now promising 700 affordable units (30.6% of total) as 537,000 square feet of area.

This amount of square footage is locked into the inclusionary zoning bonus and transfers with property but inclusionary zoning is not mandatory — the developers would retain option to build 40 story towers and almost 2 million square feet with no affordable housing at all.

No details yet on affordability levels or unit sizes.

Commercial Office SF

97,558

480,293

Retail SF (including “health club” for Two Trees plan)

126,012

109,179

Community Facility SF

143,076

143,747

Total Floor Area (excluding parking)

2.75 million

2.95 million

Floor Area Ratio (FAR) Waterfront

5.6

5.94

Floor Area Ratio (FAR) Inland

6.0

7.0

Parking Spaces

1,428

1,050

Open Space Acreage (excluding streets and sidewalks)

4.16

4.83

Height of Site A (northernmost site)

300

435

Height of Site B (large “donut” building)

340

530

Height of Site D (southernmost site)

340

435 and 535

Height of Site E (inland site)

148

170

Shuttle to transit

Promised job training program, shuttle to JMZ Marcy subway

Promising shuttle to both JMZ and L subways

Other community benefits

Promised job training program,

no other benefits yet forthcoming

 

THE “RESTRICTIVE DECLARATION” – ANOTHER NON-BINDING PROMISE FOR AFFORDABLE HOUSING

After the deal for City Planning Commission approval, we now have a Two Trees proposal for 700 units of affordable housing representing just over 30% of the units but only 537,000 square feet – less than 20% of the built square footage of the site because the retail component and the proposed school are not counted towards the arithmetic.

Split between 700 “affordable” apartments, 537,000 square feet would produce apartments of only 767 square feet on average. There’s no detail here about how many will actually be 2 or 3 bedroom sizes, but the numbers indicate that there can’t possibly be a large number of family-sized apartments. If there’s a low number of larger apartments, it’s obviously detrimental to the  families in the neighborhood under displacement pressure.

Then once again, there are few details in the most recent plan documents about affordability. We know that part of the De Blasio-City Planning deal allowed 50,000 of the affordable square feet to be reserved for higher incomes of up to 125% area median income (AMI) – over $100,000 for a family.

But we still have no idea how many apartments will be affordable to AMI’s at 60% and lower. Remember that since the median income for Williamsburg at roughly $42,000 is much lower than the overall region, the AMI has to be very low for the majority of neighborhood families to be able to afford the “affordable housing.” Only AMI’s at 60% or less are at all helpful to people under displacement pressure in Williamsburg.

Even more concerning is that according to the current City Planning documents (http://www.nyc.gov/html/dcp/pdf/cpc/140132.pdf), it appears that the “deal” for 700 affordable housing apartments is NOT LOCKED IN.

The draft of the “restrictive declaration” establishes that the modification to the inclusionary zoning bonus to produce 537,000 square feet is permanent and transfers with the property, but it also appears to provide a development alternative that would allow nearly 2 million square feet in towers up to 44 stories high be built with NO AFFORDABLE HOUSING AT ALL.  The deal appears to bank on the fact that allowing 2.9 million square feet in towers up to 54 stories with affordable housing is enough incentive to ensure the affordable housing option is taken. (see pages 22-25 of restrictive declaration linked to above)

But this is far from clear. Two Trees may be committed to the affordable housing option, but what if Two Trees were to fall into financial difficulty and sell the site. It seems like this language would allow a new developer could come in and build towers larger than any on the Williamsburg waterfront right now with NO AFFORDABLE HOUSING.

That the administration could fail to lock in the affordable housing deal despite what we’ve seen happen at Atlantic Yards and with the first Domino deal is very troubling. It is also deeply concerning that the proposal would drastically increase the size of the development that could be built with no affordable housing compared to the current zoning. Why would the City not make the affordable housing provision mandatory in the restrictive declaration? And why increase the size of a possible no-affordable housing development?

OPEN SPACE – STILL IN PRIVATE HANDS

There continues to be concerning issues of just how “public” the open space will be. Two Trees has been noncommittal on transferring the new River Street over to the City and is opposed to turning over the other public spaces at Domino to City Parks. This raises the question, why would the community prefer a slightly larger piece of private open space to the public open space promised by the 2010 CPC plan?

Moreover, renderings and diagrams Two Trees has created to illustrate uses at the proposed “Domino Square” (the large open parcel that is the company’s justification for building taller) depict flea markets, banquets, and cocktail parties where public access would clearly be restricted and curtailed. The constant occupation of East River Park by these private uses is spurring considerable controversy in Northside Williamsburg.

The new documents out of City Planning propose an interesting new mechanism for providing public input on the open space programming. A “review board” is proposed consisting of 7 members all appointed by Two Trees with 6 of these members chosen from nominations from the Community Board, the Councilmember of the 33rd District, the Councilmember of the 34th District, the Brooklyn Borough President, and the Open Space Alliance, with the 7th directly chosen by Two Trees. Detailed procedures are laid out for how this panel would receive proposed plans for open space uses from Two Trees and have the opportunity to review (see page 63 of restrictive declaration here — http://www.nyc.gov/html/dcp/pdf/cpc/140132.pdf).

While this review panel is better than nothing if Two Trees is allowed to retain private control of the open space, it is concerning that Two Trees would be able to appoint the entire board itself. Turning supposedly public spaces over to private hands is a slippery slope and a dangerous precedent to set on the waterfront where public access and ownership has been a core promise of City government for decades.

JOBS AT DOMINO – STILL NO SET ASIDE OR PROTECTION  FOR INDUSTRY

One of Two Trees major selling points is the provision of additional commercial office space in the development that will help create“3,000 new jobs.” But just as we must ask “affordable housing for whom?” we must also ask “jobs for whom”?

There continues to be nothing in any of the updated plans about setting aside portions of the open space for businesses engaged in light manufacturing or the arts. All of the public comments Two Trees has made about the proposed office space indicates that it is intended for companies in the tech and new media sectors.  American Community Survey data tells us that more than two thirds of workers in the tech and media sectors in the New York City area are white. Only 8% are Hispanic/Latino.

Two Trees promises that “local” businesses will fill its retail spaces but the developer’s record in DUMBO raises concerns that many local businesses and artists will be cast aside for higher profile commercial tenants once the market permits.

The Brooklyn Borough President’s suggestion for a “a lease protection mechanism that provides for the continued use of such retail for artisans and start-up office space, in order to provide protection from future market based rents, which may include the achievement of stabilized rents by providing leases through a designated not-for-profit or some equivalent entity” is an excellent idea, but remains absent from this proposal.

Two Trees should commit to preserving a portion of the commercial space at Domino for light industrial businesses, and the City should seek to protect the existing lots directly north and inland from Domino that remain zoned M-3 for industrial uses. The vacant properties north of the Con Ed substation on the waterfront, currently zoned M-3, offer a particularly rich opportunity for creative industrial development, but this will never happen unless the City sends a firm signal that the land will not be rezoned for residential.

SECONDARY” IMPACTS REMAIN A GREAT CONCERN

The density of the proposed Domino project is immense – it will double the population of the waterfront area of the Southside (bounded by Kent Ave, Grant St, Driggs Ave, and South 5th St.), adding thousands of wealthy residents and workers. If community benefits and mitigation measures are not smartly done, this project is a displacement time-bomb.

Yet there are still no provisions in the new “deal” about the more comprehensive community benefits the community was asking for — e.g. job training program, contribution to anti-displacement organizing, contribution to open space development, community advisory board for the development at large, etc.

If nothing is done to address secondary impacts, it raises questions about the Mayor’s strategy — whether he may be focusing too much on generating a large number of new affordable units at the expense of preserving existing affordable units (i.e. rent stabilized apartments) and undertaking improved community planning.

DE BLASIO & TWO TREES ANNOUNCE DEAL ON DOMINO BUT QUESTIONS REMAIN

Press release posted below, here are my initial thoughts on the deal.

Increasing the number of affordable units to 700 looks like a win for the community. 700 units represents roughly 30.6% of the total 2,284 units proposed by Two Trees.
I for one, was not expecting an increase in the number of units above 660, so this is a positive development.
But as always the devil is in the details, and the details are lacking in the press release
1. There’s nothing here about the affordability — the AMI (area median income) levels that the affordable apartments will be targeted at. Only AMI’s at 60% or less are at all helpful to people under displacement pressure in Williamsburg.
2. 700 units in 537,000 square feet seems like fairly small apartments — 767 square feet per apartment. There’s no detail here about how many will actually be 2 or 3 bedroom sizes. It appears that Two Trees may have preferred adding additional units instead of enlarging the units to include more 2 and 3 bedroom sizes. If there’s a low number of larger apartments, it’s obviously detrimental to families in the neighborhood under displacement pressure.
3. 537,000 is also less than 20% of the total proposed built square footage in the development — which is usually the baseline for inclusionary zoning projects. The 537,000 square footage represents only about 17.6% of the Two Trees’ project’s total square footage but about 23.5% of the residential square footage. This is an apparent compromise between what Two Trees was asking for (that residential-only count towards the 20%) and the full allocation. This is concerning that the administration would negotiate to potentially weaken the IZ program and could set a precedent for developers in the future reducing affordable housing allocations by substituting commercial space.
4. The permanent affordability is good but it’s unclear from the release whether or not this agreement for 700 units (seemingly representing about 30.6% of the total 2,284 units proposed by Two Trees) is going to be memorialized in a BINDING instrument of some kind that transfers with the property.
5. There is nothing here so far about the more comprehensive community benefits the community was asking for — e.g. job training program, contribution to anti-displacement, contribution to open space development, community advisory board, etc. If nothing is done to address secondary impacts, it raises questions about the Mayor’s strategy — whether he may be focusing too much on generating a large number of new affordable units at the expense of preserving existing affordable units (i.e. rent stabilized apartments) and undertaking improved community planning.
I’m sure more details will emerge in the coming days.
———————————–

THE CITY OF NEW YORK

OFFICE OF THE MAYOR

NEW YORK, NY 10007

 

FOR IMMEDIATE RELEASE: March 3, 2014

CONTACT: pressoffice@cityhall.nyc.gov, (212) 788-2958

No. 076

CITY REACHES AGREEMENT ON REDEVELOPMENT OF DOMINO SUGAR SITE TO INCREASE AFFORDABLE HOUSING

Proposal adds 110,000 square feet of affordable housing

NEW YORKMayor Bill de Blasio today announced the city has reached an agreement with Two Trees Management on a proposal to redevelop the Domino Sugar site on the Williamsburg waterfront, which will significantly increase the amount of affordable housing provided. Under the agreement officially proposed today at a City Planning Commission meeting, the developer will provide an additional 110,000 square feet of affordable housing as part of the project, for a total of 537,000 square feet of affordable housing.

The proposal will create 700 affordable apartments covering a range of incomes, including a significant number of units sized for families. Affordable apartments will be integrated throughout the complex, ensuring a dynamic mixed-income community. Unlike prior proposals, all of those units will be permanently affordable. Work on the first building will begin in December 2014.

Mayor de Blasio has set an ambitious goal of building and preserving 200,000 affordable apartmentsover the coming decade, and this agreement represents a major first step toward achieving that goal.

We set out from Day One to get the best possible value for the public. This partnership delivers on that commitment,” said Deputy Mayor for Housing and Economic Development Alicia Glen. “We are securing more of the affordable housing families in Williamsburg need, and we are doing it by working together. This agreement is a win for all sides, and it shows that we can ensure the public’s needs are met, while also being responsive to the private sector’s objectives. I am profoundly thankful to City Planning Chairman Carl Weisbrod and our combined teams for their work reaching this outcome.”

We are so proud and pleased with what we’ve accomplished here. This won’t just be an ordinary development—it will be part of an integrated neighborhood that brings people of every income level together. We are proud to work with Mayor de Blasio’s team and the City Council to get this project across the finish line, get shovels in the ground, and deliver the housing and jobs this city needs. We hope this can become a model for what we can all achieve together in the years ahead,” said Jed Walentas of Two Trees Management.

The proposal announced today will be voted on at Wednesday’s City Planning Commission meeting. It will increase the percentage of affordable housing to 700 units out of over 2,200 total apartments in the 2,928,429 square-foot project. The project will also include significant commercial, incubator, tech and creative space that supports the administration’s economic development strategy to increase quality jobs as part of mixed-use developments. It will also provide public access to the waterfront and other open space amenities.

 

###

DE BLASIO PUSHES FOR A BETTER DOMINO PLAN AND TWO TREES PUSHES BACK WITH PRESS OFFENSIVE

On Thursday evening, February 27th 2014, the New York Times unleashed its first article on Domino since last fall. Plan to Redevelop Domino Sugar Factory in Brooklyn Hits Snag: De Blasio,” by Charles Bagli, broke the news that the De Blasio administration, through the City Planning Commission, is seeking to secure additional square feet of affordable housing. Two Trees apparently met with De Blasio’s new City Planning Commissioner Carl Weisbrod and his Deputy Mayor for Housing and Economic Development Alicia Glen earlier this week in advance of the City Planning Commission’s vote next week.

According to Bagli, the administration is seeking “50,000 additional square feet” of affordable housing in order to provide additional 2 and 3 bedroom units. From the article, it is completely unclear what this additional “50,000 square feet” is in relation to. But it appears to me that it involves adding to the roughly 450,000 square feet of affordable housing that Two Trees wants to lock in to the project through an amendment to the inclusionary zoning. (representing 20% of residential floor area – not including commercial space in the calculation). If this is the case, the additional 50,000 square feet desired by De Blasio would close the gap between the amount of affordable housing currently locked in the 2010 zoning and the reduction that Two Trees has sought up to this point.

The Bagli article – and the slew of other articles and coverage it spurred (WNYC , Crains , Daily News etc) frame the debate over Two Trees’ Domino Sugar project entirely from the top-down. The Mayor is portrayed as injecting himself into the debate at the “11th hour” without any context other than his objective to get better deals from developers. The coverage portrays Two Trees’ Domino project as a deal that was set to go until De Blasio intervened.

In reality, Two Trees is facing new scrutiny because of the company’s refusal to negotiate with the local community to fix the two core problems of big development projects in New York City – the lack of BINDING and COMPREHENSIVE agreements for affordable housing and other community benefits.

 

TWO TREES DID NOT “WIN OVER VIRTUALLY ALL OF THE NEIGHBORHOOD GROUPS” AND THE 2010 PLAN WAS NOT “VIEWED WITH DREAD AND ROUNDLY DERIDED”

While the 2010 rezoning of Domino was indeed “viewed with dread” by those in the neighborhood who were opposed to the development of high-rise luxury towers on the site, it was heavily supported by Councilmember Diana Reyna and the Southside community groups Churches United for Fair Housing, Los Sures, and El Puente, who wore “Domi-Yes” t-shirts to public hearings.

These groups supported the project for its affordable housing program, which was relatively generous by the standards of Bloomberg administration development. “660” was the rallying cry but behind the number of units, the developer was promising 100 units for 30% AMI, 100 units for seniors at 50% AMI, 310 apartments at 60% AMI, and 150 home-ownership units at 120% AMI. Community Preservation Corporation was also committing to numerous two and three bedroom apartments.  The only aspect of the 2010 plan that the Southside groups “viewed with dread” was the fact that this affordable housing program was not codified and locked in to a restrictive deed. It was instead memorialized in a powerless” Memorandum of Understanding”.

Then there is the claim that Two Trees’ has “won over virtually all of the neighborhood groups.”  In substantiating this, Bagli cites Vivian Yee’s article from last October. It seems like Bagli did not bother checking in to see if the situation changed.

The coalition of Southside neighborhood groups (El Puente, Los Sures, St Nicks, Churches United for Fair Housing) as well as a representative of Councilmember Reynoso all testified AGAINST  Two Trees plan in favor of stronger affordable housing provisions, contributions to anti-displacement organizing, a parks development fund, community-based groups running the community facility, a community advisory board, and more.

Last fall, these Southside coalition groups were tentatively supportive of Two Trees but expected their concerns to be addressed in negotiations that have not yet occurred. Two Trees has thus far refused to guarantee 30% affordable housing, include three bedroom units, or improve affordability. The wider reaching demands by El Puente for meaningful contributions to community open space, cultural activities, and progressive sustainability initiatives have been completely ignored by the developer, and by the media as well.

The position of Rob Solano and Churches United for Fair Housing, quoted in Bagli’s article and ostensibly a member of the community coalition, is murky.

Solano was very supportive of Two Trees at the Community Board but then Churches United for Fair Housing sent staff member Bruno Daniel to testify against Two Trees at the City Planning hearing as part of the Southside community coalition. Then in Bagli’s article, Rob Solano appears to undermine the community coalition’s demands by stating “It’s a delicate balance between pushing as hard as you can and a break…“If we get to the point where nothing is built, or there are more delays, that’s another day without affordable housing.” Where do Solano and Churches United for Fair Housing really stand on this development? Do they agree with the coalition’s push for stronger affordable housing, or do they support Two Trees current proposal so that affordable housing units might be produced faster? Solano’s repeated positive comments about Two Trees’ plan to the press raises questions about where he really stands. It is unfortunate that the press treats him as a spokesman for the community without reaching out to other groups as well.

 

THE COMMUNITY BOARD AND BOROUGH PRESIDENT DID NOT “SUPPORT” THE PROJECT AS PROPOSED BY TWO TREES – IN FACT THEY SUPPORTED DE BLASIO’S POSITION

Another inaccuracy in Bagli’s article is the unfortunate assertion that the Community Board “supported” Two Trees’ plan. Subsequent coverage also noted that the Borough President “supported” Two Trees.

In reality, the Community Board and Borough President do not just say “yes or no” — they attach long reports of conditions alongside their overall recommendation. both CB1 and the BP recommended “Yes with conditions” which means Yes but only if you do “X”. For the community board, it was locking in the affordable housing legally, making more units more affordable (lower AMIs), and more two and three bedroom units. The Borough President’s report was much more comprehensive in proposing a wide range of improvements to the housing as well as the commercial program and open space. In reality, both the CB and the BP supported what De Blasio is asking for and more.

This is yet another illustration of why Community Boards and Borough Presidents should simply have to vote Yes or No on the project as presented to them rather than have the option of voting “with conditions.” This happens over and over again in ULURPs where the media does not bother to read the actual report and only digests the topline “Yes” or “No” recommendation.

 

IT’S NOT JUST ABOUT SQUARE FOOTAGE – THE AFFORDABILITY LEVELS ARE CRITICAL.

Lost in all the rigmarole over the square footage of affordable housing is the crucial issue of the affordability itself. This is probably part of the discussion between the De Blasio administration and Two Trees but was not reported on.

As I wrote in my testimony to the City Planning Commission, in Brooklyn Community Board 1, the Area Median Income is only $41,540 – roughly 50% of the metropolitan AMI that is used to calculate affordable housing. Therefore, in order to have “affordable housing” that is actually affordable to the majority of community households in Community Board 1, it has to be targeted at 50% AMI or lower. 60% AMI will be helpful to some in the community under pressure from displacement, but anything higher than 60% AMI and we really can’t consider it “affordable housing” for Community Board 1 in any meaningful sense of the term.

 

AND WHAT ABOUT  MORE COMPREHENSIVE COMMUNITY BENEFITS?

And not surprisingly the conversation about planning beyond “affordable housing” is drowned out again as it often was during the Bloomberg years.

In this case, it should not be though, because community groups are explicitly calling for additional actions like for Two Trees to contribute to anti-displacement organizing, the development of additional open space in the neighborhood beyond  directly at the Domino site, a role for local groups in the operation of the community facility, and a community oversight board.

Groups have seen how the redevelopment of Williamsburg spurred by the 2005 rezoning has had profound effects on the character and composition of the neighborhood.  The density of the Domino project is immense – more than 5,000 new residents and thousands of new office workers — and if community benefits and mitigation measures are not smartly done, this project is potential displacement time-bomb. Two Trees and other major developers in Williamsburg should commit to funding local community organization to engage in anti-displacement work. This is by far the most cost-effective way to preserve existing affordable (rent-stabilized) housing units.

None of the press coverage of the last few days has addressed the issue of more comprehensive community benefits in order to address the “secondary” impacts of such a giant project on the neighborhood.

 

NOT JUST DE BLASIO’S FIGHT

Bagli and the rest of the press are absolutely correct that because Domino is the first major rezoning proposal in the new administration, it is a very important test case for how development will proceed under Mayor De Blasio.

But De Blasio did not parachute into the Domino debate to ruin a good deal with his progressive agenda. The debate over development at Domino Sugar has gone on for years and the community has learned that without more extensive, legally binding affordable housing and community benefits, the community will inevitably lose.

De Blasio’s demand for 50,000 additional square feet of affordable housing and whatever other concessions have not yet been disclosed, are not coming from the top down. In taking a tougher line with Two Trees, De Blasio is representing the interests and wishes of the local community in Southside Williamsburg.

Let’s hope he holds strong and achieves more than just a few more square feet of affordable housing. The development plan at Domino should represent the first step towards more responsible development that lives up to a higher standard of good growth that broadly benefits all of New York.

CITY PLANNING COMMISSION AND COMMUNITY GROUPS GRILL TWO TREES AT HEARING

Community support for Two Trees’ Domino Plan is falling due to the lack of specific, binding commitments to community benefits.

I apologize for not posting this sooner – it’s been a busy few weeks

Two Trees’ Domino ULURP arrived at the City Planning Commission on January 22nd, 2014, the first major rezoning proposal to come before the Commission after the resignation of longtime Bloomberg administration City Planning Chair Amanda Burden. Since Mayor de Blasio had not yet appointed his new Chair, another Bloomberg appointee, Vice Chair Kenneth Knuckles, presided over the hearing.

You can watch the hearing for yourself (http://www.nyc.gov/html/dcp/html/luproc/calbeg.shtml#pmv) thanks to the City’s new law requiring webcasting/video archiving of all public hearings.

WALENTAS GRILLED BY COMMISSIONERS

As always, the hearing began with representatives from the developer, in this case Two Trees, taking the dais first. But absent the calming (or stifling) presence of Amanda Burden, the Commissioners were notably more lively and inquisitive than I’ve seen them in the past.

Vishaan Chakrabarti was the first to speak for Two Trees and very quickly made the point that “Community Board 1 voted 24 to 4 for this plan.” This is yet another illustration of why Community Boards should simply have to vote Yes or No on the project as presented to them rather than have the option of voting “with conditions.” Community Board 1 voted Yes with conditions but as with many ULURP processes I’ve witnessed, the conditions seem to evaporate when supporters speak about the project. The same holds for the Borough President, who in this case also recommended a “Yes” vote but included very strong recommendations for improved, binding community benefits.

After Chakrabarti gave an abbreviated version of the project description we’ve seen numerous times in the past year, Commissioner Angela Battaglia raised major issues about the proposed affordable housing program in the development.

Before I describe the concerns she raised, let me note that Battaglia is somewhat of an odd duck on Commission right now – she is a housing executive for the non-profit Ridgewood Bushwick Senior Citizens Council, the organization founded by disgraced former Assemblyman and Brooklyn County Boss Vito Lopez and constantly under investigation for its political activities. She is also Lopez’ longtime girlfriend. Vito Lopez was very involved in the 2010 rezoning of Domino Sugar, initially opposing it throughout the ULURP for reasons that appeared to be more to do with political strategy that genuine concern. In the end, Lopez and ally Councilman Steve Levin settled their differences with Community Preservation Corporation and gave us the non-binding memorandum of understanding for 30% affordable housing that continues to influence the project to this day.

Battaglia was originally appointed by Rudy Giuliani and was last reappointed to a five-year term by Mayor Bloomberg in 2008 at the height of Lopez’ political influence. She is due to be replaced on the Commission any day now by Mayor de Blasio.

But I digress – despite the odd circumstances of her continued presence on the Commission, Angela Battaglia spoke up for the interests of the local Williamsburg community in pressing a case for the affordable housing to be appropriately targeted to meet their needs. She raised the point that in the 2010 Domino Plan, the vast majority of the units were targeted to 60% AMI or lower and she went on record supporting the Community Board’s requested conditions of affordable units being majority two and three bedroom sizes. She closed her remarks noting I certainly think that if we are going to approve a development that goes that far above the height limits…that we should accommodate the population that lives there.”

Chakrabarti punted the tough questions on affordable housing to his client Jed Walentas, who took the podium next. Walentas began by delivering his usual explanation of the project, focusing especially on its comparative superiority to prior developments on the Williamsburg waterfront. He closed by stating “What we want to do with you all and the City Council is to make an absolute binding commitment for 660 units of affordable housing…we are creating a huge amount of value with this plan vis a vis the other plan and in my opinion we are giving the overwhelming value back to the public in the form of this increased affordable housing and the much much improved open space”

Surprisingly, Vice Chair Knuckles interjected here with a cutting remark: “You forgot the “if”…the 660 units if…”

Walentas paused and clearly revealed this: The conditions of our 660 units of affordable housing are that 421a continues, which to be totally honest is a condition of any affordable housing that is going to happen in this city.”

One has to give credit to Jed Walentas for not mincing his words. Unfortunately, as I and others have written many times before, 421a is a horribly inefficient way to produce affordable housing and is mostly a huge giveaway to developers. The program often delivers less than 20 cents of affordable housing for every dollar given away – and there are over $1 billion in such giveaways occurring annually. It is highly unfortunate that Two Trees is choosing to hold Domino’s affordable housing hostage over the 421a tax break.

What would be most helpful in this discussion would be a clear analysis of the proposed development’s financials. As I wrote in a post last year, policy makers should be able to discuss and weigh the relative size of the development’s profit margin with costs of various community benefits as well as the public impacts of additional density. If it’s really true that the project’s economics don’t work out without a subsidy as generous as 421a, Two Trees should prove it by releasing a detailed set of financial projections.

Even with the 421a in place, Walentas continues to oppose incorporating 3 bedroom units into the development: “The truth is the economics of affordable housing from our standpoint is about square footage and how much square footage gets devoted to that. Obviously to build 3 bedrooms as opposed to 1 bedrooms is much more square footage, at some juncture this becomes an economically not viable project and we’re going to go back to the alternative. There’s only so much that we can do…if you’re asking me to fund that privately there’s a limit to what I can do.” Again, without the financials, the public is completely in the dark as to whether or not Two Trees self-imposed “limit” on providing public benefits is actually reasonable.

The issue of the 421a tax break also underlies the controversial amendment to the inclusionary zoning that Two Trees is asking for – the provision that only the residential square footage of the development be counted towards the requirement for 20% of the area to be set aside for affordable housing. As I noted in my testimony to the Community Board and in writing to the City Planning Commission, this would actually result in less required affordable housing than is locked into the current Domino zoning enacted in 2010, because Two Trees is proposing to reduce the overall residential square footage by 160,000 square feet. According to Jed Walentas, the text amendment would only come into play if 421a was not extended in Albany in 2015 – which would then throw the supposed “commitment” to 660 units into question.

Hearing this explanation, Commissioner Anna Levin noted “If that’s the case I’m not really sure that your commitment for 660 is different from the MOU’s commitment.”

 

Jed Walentas listens intently as he's questioned by City Planning Commissioners

Jed Walentas listens intently as he’s questioned by City Planning Commissioners

In response, Walentas further explained his point of view: “We’ve got a billion and a half dollar project…we have a community, we have public servants and city officials looking to us and saying “you need to promise us, you need to guarantee.” But I have no idea what interest rates are going to do, I have no idea what the market is going to do, there are lots of variables…we are happy to have it become part of some sort of declaration that is approved at the council and is truly binding…but the City and State have to conduct themselves from a real estate finance standpoint in a way that we understand the rules of the game are being played now. And the two things we are asking for is for 421a to be continued and for off the shelf HPD and HDC subsidies.”

Translation: “If very generous subsidies for the real estate industry don’t continue, I may not make the amount of money that I want to make on this project so the affordable housing promise (that was responsible for making this project possible in the first place) will have to be broken.” What’s totally unclear here is whether or not the amount of profit that Two Trees wants to secure is in reasonable balance with the tremendous impacts that the redevelopment of Domino will have for the community of Williamsburg and New York City public at large.

Commissioner Chin rightly raised further concerns: “What your asking for is this asymmetrical situation where we lock in the size, the shape, the uses on the development potential… but on the other side the responsibility for providing the affordable housing are not locked in”

Commissioner Irvin Cantor also weighed in, noting “Two Trees is one of the better companies in the City of New York in terms of development. Having said all that…your bottom line includes 200,000 extra square feet. You’re also reducing the residential floor area by 165,000 square feet, most of it, if I’m correct, by diminishing the size of the affordable housing units”

Walentas responded by arguing that developers should not be penalized for wanting to include more commercial space – “Commercial office rents in this neighborhood are about 30 a foot, residential apartment rents in this area are about 55 a foot…we think it’s the right thing to do to create a more valuable, more interesting long term neighborhood…You are right that by reducing the residential square footage by 175,000 square feet, what you’re getting simply by the inclusionary math will yield slightly fewer, slightly fewer guaranteed from the inclusionary text, residential units. We recognize that, we’re saying that we are willing to go above and beyond that. We are saying that this is a more valuable plan that creates more value…we are taking the value of the improvement here and we are giving it back to the public.”

When pressed further by Cantor as to whether or not Two Trees would be able to satisfy the community’s concerns regarding greater affordability and larger unit sizes, Walentas and Cantor had the following exchange:

Jed Walentas: “We have probably a little room to adjust on our own…this is not a normal ULURP where someone has an M zone thing that they can’t do anything with and they’re coming to the public saying “We need a rezoning we want the public to give us $100 million value boost and then there’s some weird negotiation that takes place about how much of it goes to the government and public sector and how much of it goes to the developer. This is not that situation at all…We do have a real alternative that we can and will build and I don’t mean that in a threatening way, it’s not what we want to do…at the same time we’re not in the philanthropy business.”

Irvin Cantor: “We’re being asked to make a firm commitment today while you can’t make a firm commitment until you know what happens tomorrow”

Jed Walentas: “then you really need to evaluate what the real alternatives are…if you vote this plan down and I have to build the old plan, the 421a is still a problem”

Irwin Cantor: “What would you do if you had to build the old project and ran into the 421a problem?”

Jed Walentas: “I don’t know what we would do…we would evaluate, we would probably have to build some market rate condos to get out of the thing, we would probably evaluate building lower density and building no affordable housing…Building rental housing is difficult enough, doing affordable rental housing without 421a…I can’t even imagine.”

After another interchange with Anna Levin about the open space (which I’ll address shortly), Commisioner Del Toro echoed the feelings of Battaglia, Cantor, and Chin, noting “I like to know exactly what I’m voting for and I know right now there’s not enough clarity for me. I know right now what is the best case scenario, 660 units, but I don”t know what the worse case scenario.”

At this point, Commissioner Al Cerullo, a Staten Island Republican appointed by Bloomberg – felt compelled to step in and defend Two Trees – “I have no reason not to believe the commitment that you’ve made with respect to the affordable housing piece of this. I also feel that the condition [that 421a stays in place] on that commitment is not at all unreasonable. And I know that we have approved projects in the past where we have been told that there would be a certain number of affordable housing units but the financing was not yet complete and the developer was talking to HPD and HDC…the hooking into this project as if that condition [the lack of benefits being locked in] is somehow unique and is providing you something that perhaps we have provided or not focused on in the past with applicants..I want to acknowledge that the condition you outline is very real and I don’t know that we should be holding you to a different standard than we’ve been holding other developers over time.”

Cerullo is correct that in the past, City Planning has typically approved projects with lots of promised public benefits but a lack of binding mechanisms to enforce them. Indeed, the current situation with Domino – where Two Trees already has a favorable mixed-use zoning without strong community benefits locked in – is exactly the result of such an approval. Unlike the other Commissioners however, Cerullo doesn’t seem to see this as a problem and a lesson to learn from.

In addition to the heavy questioning over the lack of affordable housing commitments, Anna Levin also raised questions about the private ownership of the open space. Walentas’ explanation for keeping the open space privatized is that he sees “this as a much more densely programmed unique open space that brings a number of unique elements that the parks department is not used to dealing with.” This kind of “dense programming” recalls the renderings of flea markets, cocktail parties, and movie screenings that a Two Trees consultant prepared to illustrate the uses of the space, and again raises my point that there is no clarity on how often “Domino Square” will be occupied by pseudo-private events. Jed also commented that Two Trees prefers to keep control over the open space because its condition and use “has the ability to really affect our asset values.” This comment implies that despite all the rhetoric on wanting the development to be “open to the community,” the programming at Domino Square and the rest of the open space will be geared towards the affluent, and the working class community of the Southside will not feel as welcome there as in a typical public park.

After the Commissioners were finally finished questioning Walentas, acting Chair Knuckles thanked him for a very long three minutes.” The heavy questioning on the issues of locking in affordable housing and community benefits raises hopes that the Commission is looking to learn from the mistakes made during the Bloomberg era.

REYNOSO AND COMMUNITY GROUPS TURN UP THE HEAT ON TWO TREES

Perhaps even more surprising than the City Commission’s awakening from its decades-long somnambulance was the sharp shift in tone by Councilmember Reynoso and the Southside community coalition (including Churches United for Fair Housing, El Puente, St Nicks Alliance, and Southside United HDFC Los Sures).

While El Puente offered extensive criticism and recommendations for improving the project at the earlier Community Board level, Reynoso and the other organizations were largely approving of the project despite demanding a stronger mix of more affordable housing and larger units. Churches United for Fair Housing’s Rob Solano was especially vocal in his support for Two Trees at the Community Board level, urging the board to approve the “Yes with conditions” resolution. The argument at the time suggested that Two Trees would continue to “work with” the community groups and eventually agree to the community demands.

Yet as the Commission’s dialogue with Walentas shows, Two Trees has thus far refused to guarantee 30% affordable housing, include three bedroom units, or improve affordability. The wider reaching demands by El Puente for meaningful contributions to community open space, cultural activities, and progressive sustainability initiatives have been completely ignored by the developer.

Lacey Tauber, Councilmember Reynoso’s new legislative director and one who has been involved with the Domino development for many years due to her prior work with NAG, spoke first on behalf of the Councilmember: “Until recently this group was pleased with Two Trees proactive efforts towards community engagement. However now, as we come down to the wire, the Coalition is growing concerned that Two Trees commitments to the community, particularly those related to affordable housing, open space, workforce development, and community facilities, lack both the depth and the teeth to truly serve our community’s needs and mitigate the intense impacts that luxury development of this scale is sure to have… I want to encourage you to vote no on the zoning text amendments that will affect the inclusionary housing requirements of this plan… Commercial space is not a public benefit and its inclusion in the project is the developer’s choice based on an analysis of the market. They should not be held to a lower standard of housing development as a result. We believe that Two Trees capacity is such that they can build both commercial space and affordable housing successfully and we believe our requests are reasonable considering the large amount of subsidies this project will receive. Additionally in order to meet the community’s needs, the AMI levels must remain as low a possible.”

 

Esteban Duran argues for improved community benefits

Esteban Duran argues for improved community benefits

Esteban Duran of El Puente spoke next and detailed El Puente’s suggestions for improved sustainability in the development: “we’re looking at a baseline renewable energy source on site allowing for solar, wind, or geothermal heating and allowance for positive monetary gains reaped by the generation of said energy to be shared with the community. We’d like to get the provision of on-site recycling sorting facility that can hire local residents to alleviate the waste truck traffic that currently inundates the community. Commitment to establish a working dock capable of marine transfer of waste and recyclables to mitigate already high truck traffic in Community Board 1. This waste transfer system could be a citywide model the first of its kind and would significantly reduce the negative burden on the surrounding neighborhood. And we’d like them to work in coalition with El Puente to seek the removal of the Radiac toxic waste storage and transfer site. Lastly we cannot support the proposal to contract with Asphalt Green to operate a recreational facility under any circumstances, and that’s primarily because Asphalt Green threatens the environmental justice of North Brooklyn by participating in the lawsuit against the East 91st Street municipal waste transfer station…There is currently no enforceable commitment to community oversight and accountability, all agreements reached with Two Trees must be legally enforceable and binding. As much as possible all agreements must be included in the restrictive declaration of the technical memorandum. What cannot be included in the restrictive declaration must be included in a community benefits agreement or strong MOU enforceable by the City as well as by a Community Oversight Board and we’d like that board to reflect the makeup and interests of the Southside community and meet quarterly throughout the construction and annually from that point forward. And again, we’re really thankful and want to see development on this site…I live 9 blocks away from that waterfront, we want to see it developed, we just want to make sure it is done in a way that is really helpful to the entire community.”

Anusha Venkataraman of El Puente spoke next and continued the arguments made by Duran: “While this group has communicated extensively with Two Trees, we’ve received very few indications of commitments to our areas of concern to date…In particular we urge you not to pass the zoning text amendment…Just the residents added is a 17% increase in the population of the Southside community so that’s the scale of our level of interest here… We are happy that Two Trees is committed to funding the construction, operation, and maintenance of the space. While we would prefer the space to be publicly owned…we would be satisfied with a strong operating agreement with the Park department as long as that agreement ensures public access, rules and regulations identical with City Parks, and a direct partnership with community groups to program the space. We, El Puente, is prepared to enter such a partnership since we have done programming such as this in the past and we look forward to hammering out the details including funding…Since the per capita ratio of open space is not significantly changed with this project…we ask that Two Trees pay into a Southside Parks Endowment to fund capital investment in parks in the neighborhood including but not limited to the Williamsburg Bridge Park, the BQE decking project, or other improvements to existing parks. Regarding the community facility space, we cannot support the proposal of a contract with Asphalt Green and ask that the partnership be with a local organization instead…a local partner will ensure local oversight and access. The Southside of Williamsburg is also in great need of a full service theater, performing arts center, and cultural center. The Two Trees proposal currently has unallocated community facility space. El Puente will commit to operating such a center which would be open to the broader community”

As I said of El Puente’s testimony on the community-board level, it is a breath of fresh air to see a local community group taking such a strong stance on improving development and planning practices in New York City. Meaningful sustainability initiatives are almost never part of the conversation around individual developments in New York, and the suggestion for a Community Oversight Board to oversee construction and the fulfillment of community benefits is an especially powerful one.

From both El Puente, Councilmember Reynoso (who was Diana Reyna’s chief of staff) and the other Southside groups, there seems to be a greater awareness of the potential secondary impacts of this enormous, mostly luxury residential project than there was during the 2010 Domino process. After El Puente, two staff members from Los Sures – Deborah Medina and Sula Panagademos – testified in support of stronger affordability, larger units, and for Two Trees’ to contribute to anti-displacement work in the Southside. Bruno Daniel, a staff member for Churches United for Fair Housing, also testified, stating “Despite talks and assurances…we’re at a point where details of the foundation of the project remain a mystery. While the project remains unclear, we are here to ensure that our Coalition does not.” He spoke out against the weakening of affordable housing requirements requested by Two Trees and for the need for the 660 units to be in a binding commitment with 3 bedroom units included. “We have not received any sort of real response on most of these issues and little else beyond vague PR statements on the rest.”

 

ANHD's Moses Gates points out that Two Trees would be "triple dipping" in public money

ANHD’s Moses Gates points out that Two Trees would be “triple dipping” in public subsidies

The Southside groups had some strong policy wonk support with the presence of Moses Gates of ANHD (Association for Neighborhood and Housing Development – Los Sures and St Nicks are both members). Gates effectively debunked Two Trees’ argument that they are providing a public benefit concession by building commercial space – “On the commercial issue, while its true in this case that on day 1 you might be taking a financial loss by building community facility or commercial, it is not a public concession to build that, it is a market-based decision, the entire point of the Two Trees Management philosophy is to build a neighborhood, you build the additional commercial and community facility to improve the neighborhood which improves your asset and improves your market-rate rental units so in the long term investment strategy its actually a plus. I happen to think that’s good urban planning I happen to think its good neighborhood development, it’s not a public concession and as a result it should not result in weakening inclusionary zoning rules.”

Gates also pointed out the problematic issue of “triple dipping” – developers receiving triple bonuses for affordable housing through the inclusionary zoning (allowing them to build much higher and larger), the 421a (a state-controlled decade-long property tax break), and additional money from the City through HPD. “Each of those programs is meant to incentivize affordable housing on its own, it’s not meant to be a triple dip where you make all the programs line up, fulfill them with one affordable housing commitment, and then get all three pots of money.” Two Trees’ claims of poverty if they improve their affordable housing lose credibility when one considers the “triple dipping” in public subsidies that’s likely to occur – even without the 421a it’s still a double dip.

Longtime opponent of high-rise luxury development at Domino, Stephanie Eisenberg, again rightly pointed out the relatively low price Two Trees paid for the Domino site – $55 per buildable square foot, less than a third of what other developers have paid. Seemingly this would leave a lot of money leftover for affordable housing and community benefits even after the cost of historical preservation at the Refinery but again, we’ve never seen a developer open their books and lay out their real financial projections of development at Domino.

Finally, Councilman Steve Levin, who’s been largely invisible in this process, finally made some kind of public statement through his Legislative Director Rami Metal who quickly noted that he “shares the concerns” expressed by the community groups and is against the changes to inclusionary zoning proposed by Two Trees.

After the barrage of criticism from influential groups, Two Trees had six staff members/consultants lined up to speak more on behalf of the project, including spokesman Dave Lombino who noted that there was “near universal consensus that our plan is vastly better than what we could build there as-of-right.” This is a point that Two Trees has made throughout the process – “better is better,” no matter if your subject of comparison sets the bar extremely low.

Other later testifiers in support included the Brooklyn Chamber of Commerce, the Metropolitan Waterfront Alliance (which has a fixation with anything that will bring “access to the water”), the Regional Plan Association, Bloomberg’s favorite planner Mitchell Moss, Steve Hindy of Brooklyn Brewery, a representative of Assemblyman Joe Lentol (who has been very supportive throughout), New Yorkers for Parks, the Downtown Brooklyn Partnership, and the folks involved with Two Trees’ pop-up “Havemayer Park.”

WHAT’S NEXT?

The Commission will meet again on Tuesday February 18th to discuss and vote on Two Trees’ Domino proposal, and Mayor De Blasio’s new City Planning Chairman Carl Weisbrod (http://www.nytimes.com/2014/02/08/nyregion/de-blasio-picks-revitalization-veteran-to-lead-planning-commission.html) will be presiding over the meeting this time. Although the Mayor promises “a different approach” to planning and to look at proposals “with fresh eyes” to extract more public benefit, Weisbrod is a real estate industry insider and it’s unclear how much he will push back against developers’ narrow interests.

Will the Commission move more aggressively to secure community benefits or will the Bloomberg pattern of lofty promises with no enforceability prevail? Are Reynoso and the Southside groups serious about securing the binding community benefits they are asking for, or is it all just the theatrical prelude to a lesser deal being worked out in the backrooms of the Council?

It appears to me – and I hope I’m right – that both City officials and community groups are sincere in their efforts to establish a new standard of binding, meaningful community benefits at Domino. Although Southside Williamsburg obviously has the most at stake here, how this all works out will have implications that reverberate far beyond the neighborhood.

CITY PLANNING MEETS ON DOMINO

City Planning is holding their ULURP hearing on Domino today, without a new Chair to replace Amanda Burden. Kenneth Knuckles is acting chair. I am not able to make the hearing, but I submitted this testimony via fax yesterday. Most of it is drawn from previous blogs and writing.

Almost four years ago, in February 2010, I was at Brooklyn Community Board 1 when the Community Preservation Corporation held their first ULURP presentation on the Domino project. I was there as a graduate student in urban planning on the first shoot of a film project called “The Domino Effect” that would go on to document every one of those hearings. Now, nearly four years later, I am offering testimony on Two Trees’ proposal as an urban planner who has studied and worked on New York City land use issues in great detail, and as a local resident of Williamsburg with first-hand experience of how this neighborhood is being rapidly transformed by out-of-control development.

I continue to believe that 3 million+ square feet is far too much density for this site, and in an ideal world at Domino we would be considering creative alternatives that would find greater synergy with the local economy and community such as an industrial/creative business incubator, a new university branch, or a combination of such developments with 1,000 units of mixed-income housing. But for the purposes of this review process, let’s aside the issues of density and whether or not development dominated by high-density residential is the best use of this site.

If we simply evaluate the Two Trees proposal on the basis of its touted public benefits of “affordable housing” “jobs” and “open space,” it becomes clear that these measures fall short of truly benefitting the public and local community. If Two Trees and the City Planning Commission are truly interested in fostering development that benefits the long-term interest of Williamsburg and New York City as a whole, the proposed public benefits must be more clearly defined, strengthened, and locked into a binding restrictive deed.

“AFFORDABLE” HOUSING

In Brooklyn Community Board 1, the Area Median Income is only $41,540. Therefore, in order to have “affordable housing” that is actually affordable to the majority of community households in Community Board 1, it has to be targeted at 30% to 50% AMI. 60% AMI will be helpful to some in the community under pressure from displacement, but anything higher than 60% AMI and we really can’t consider it “affordable housing” for Community Board 1 in any meaningful sense of the term.

In 2010, the Community Preservation Corporation was promising 660 units broken down as follows:  100 apartments at 30% AMI, 100 senior housing units at 50% AMI, 310 apartments at 60% AMI, and 120 “affordable home ownership” units at 120% AMI. While only the 100 apartments at 30% AMI would reach the majority of those in need, at least 510 of the 660 units were for 60% AMI or lower.  Community Preservation Corporation was also promising a diverse mix of apartment sizes with significant numbers of larger 2 and 3 bedroom apartments.

In contrast, Two Trees has been noncommittal and extremely vague about both the affordability levels and the distribution of units sizes. Each of these factors has a critical impact on the degree to which the proposed “affordable housing” will actually benefit the public interest and justify the additional density and government subsidy. The City Planning Commission cannot adequately asses this project while lacking full understanding of the affordable housing program.

Additionally, Two Trees is requesting that only the residential floor area of the development be counted towards its allocation of affordable housing and is committing to allocate only 20% of it. Compared to the 2010 plan, Two Trees’ proposal reduces the residential square footage by 160,639 feet. Therefore, in regard to what is actually proposed to be locked in to the zoning, Two Trees is proposing less square footage of affordable housing than required under the existing zoning.

I strongly agree with the recommendation of the Brooklyn Borough President that the promise of 660 units (30% of the total units) of affordable housing – with enough square footage for reasonably sized two and three bedroom units — must be legally locked into the property. Such a promise should be a bedrock commitment of development at Domino and not be held hostage to additional subsidy or dependent on the status of the 421a tax break.

OPEN SPACE

Open Space” is the second major selling point of the plan, and Two Trees is proudly proclaiming that their plan provides an additional 2 acres of open space compared to the 2010 plan. But looking at the details, the majority of this additional space would be taken up by the proposed extension of River Street through the site as a “private drive.” According to the technical memorandum, 1.31 acres of the claimed additional 1.98 acres is taken up by the additional street and sidewalks. Taking this into account, the Two Trees plan would do almost nothing to improve the abysmally low open space ratio on the Southside.

Then there are concerning issues of just how “public” the open space will be. Two Trees has been noncommittal on transferring the new River Street over to the City and is opposed to turning over the other public spaces at Domino to City Parks. This raises the question, why would the community prefer a slightly larger piece of private open space to the public open space promised by the 2010 CPC plan?

Moreover, renderings and diagrams Two Trees has created to illustrate uses at the proposed “Domino Square” (the large open parcel that is the company’s justification for building taller) depict flea markets, banquets, and cocktail parties where public access would clearly be restricted and curtailed. The constant occupation of East River Park by these private uses is spurring considerable controversy in Northside Williamsburg. It is completely unclear how often the proposed “Domino Square” will be occupied by this kind of event programing, how curtailed the public access will be when these events are taking place, and what kind of access local community organizations will have to hold events. And if the “public” spaces are privately owned and operated by Two Trees, will they have the right to establish their own rules and regulations governing access and uses? Will Two Trees have its own private security patrolling the “public space”?

Maintaining the public spaces in private hands is a dangerous precedent to set on the waterfront where public access and ownership has been a core promise of City government for decades. Two Trees should commit to turning over the public spaces to the City and be very clear in establishing how access to “Domino Square” will be decided and regulated.

Other actions that Two Trees could take in support of open space in Williamsburg include making a financial contribution to the development of “Williamsburg Bridge Park” on the city-owned lots under and adjacent to the bridge. Two Trees has already claimed they will “support” such efforts but they have not committed to financially contributing. Two Trees could also make a financial contribution to the further development of Bushwick Inlet Park just up Kent Avenue from Domino. Both of these actions would be true “win wins” – increasing Two Trees’ property value at Domino while contribution to meaningfully expanding open space in Williamsburg.

JOBS AT DOMINO

One of Two Trees major selling points is the provision of an additional 405,570 square feet of commercial office space in the development that will help create“3,000 new jobs.” But just as we must ask “affordable housing for whom?” we must also ask “jobs for whom?”

All of the public comments Two Trees has made about the proposed office space indicates that it is intended for companies in the tech and new media sectors. The developer holds up Vice Media as an example of the kind of company it’s office space will be geared for. So who will be holding these promised 3,000 new jobs? Without a concerted effort at job training and local hiring, the answer is mostly young white men. American Community Survey data tells us that more than two thirds of workers in the tech and media sectors in the New York City area are white. Only 8% are Hispanic/Latino.

Community Preservation Corporation had committed to job training programs in the 2010 plan. According to the Borough President’s report, Two Trees is considering working with St. Nick’s Alliance on a job training program. This is a welcome improvement from earlier in the process when there was no mention of job training, but we are once again lacking a concrete proposal. I agree with the Borough President’s recommendation that Two Trees outline and submit its job-training and local-hiring proposals in writing and that they be memorialized in a legally-binding mechanism.

In addition to job training, access to affordable broadband access is a major issue for working class-communities. Two Trees could make a valuable contribution by offering free- wi-fi access throughout Domino’s public spaces and community facilities.

Two Trees has also emphasized that they will look to provide commercial and retail space for local businesses at Domino, including businesses engaged in light manufacturing and the arts. But the developer’s record in DUMBO raises concerns that many local businesses and artists will be cast aside for higher profile commercial tenants once the market permits.

The Brooklyn Borough President’s suggestion for a “a lease protection mechanism that provides for the continued use of such retail for artisans and start-up office space, in order to provide protection from future market based rents, which may include the achievement of stabilized rents by providing leases through a designated not-for-profit or some equivalent entity” is an excellent idea.

SECONDARY” IMPACTS A GREAT CONCERN

The redevelopment of Williamsburg spurred by the 2005 rezoning has had profound effects on the character and composition of the neighborhood. As a local resident who has studied land use in the area for many years, I am convinced that rapid re-development dominated by luxury residential is killing the dynamic mixed-use, mixed-income, mixed-ethnicity character of Williamsbur

  • According to American Community Survey data, from 2000 to 2010 Community Board 1 lost nearly 16,000 affordable apartments that had rents less than $1,000 a month. In 2000, there was hardly a single apartment that cost over $2,000 a month; in 2010 there were over 6,000 such apartments in Community Board 1
  • From 2000 to 2010, the Hispanic population in CB1 dropped 24%
  • From 2000 to 2010, the 11211 zip code lost nearly two thirds of its industrial jobs.
  • No doubt all of these figures have gotten much worse since 2010.

The density of the proposed Domino project is immense – it will double the population of the waterfront area of the Southside (bounded by Kent Ave, Grant St, Driggs Ave, and South 5th St.), adding thousands of wealthy residents and workers. If community benefits and mitigation measures are not smartly done, this project is a displacement time-bomb. Two Trees and other major developers in Williamsburg should commit to funding local community organization to engage in anti-displacement work. This is by far the most cost-effective way to preserve existing affordable (rent-stabilized) housing units.

As for industrial jobs, earlier this month, Crain’s New York Business reported on skyrocketing rents and bidding wars for industrial properties throughout the five boroughs, but especially in North Brooklyn and the Long Island City area of Queens. One of the primary reasons?The “rampant erosion of industrial locations in recent years, owing to residential rezonings and growth in competing uses such as retailing and hotels.”

In contrast to tech and media jobs, the workforce for industrial jobs is majority people of color and foreign born, and industrial jobs pay nearly twice as much on average as retail work in New York City. By Two Trees’ own data in the technical memorandum, there are still 24 manufacturing and 30 wholesale trade firms amounting to nearly 900 jobs within a quarter-mile of the Domino site. But without concerted action by Two Trees and the City, it is hard to envision these businesses continuing once the proposed Domino development is built. Two Trees should commit to preserving a portion of the commercial space at Domino for light industrial businesses, and the City should seek to protect the existing lots directly north and inland from Domino that remain zoned M-3 for industrial uses. The vacant properties north of the Con Ed substation on the waterfront, currently zoned M-3, offer a particularly rich opportunity for creative industrial development, but this will never happen unless the City sends a firm signal that the land will not be rezoned for residential.

Looking at how Williamsburg has transformed since the 2005 rezoning, it is abundantly clear that a course correction is necessary to facilitate development that lives up to a higher standard of “good growth” that encourages broadly-shared long-term prosperity.

Although more creative alternatives with a greater emphasis on industrial and commercial space would be ideal in a perfect world, I nevertheless believe Two Trees’ Domino project has the potential to improve on previous waterfront development in Williamsburg – but only if the public benefits are more clearly defined, strengthened, and locked into a binding restrictive deed, and if the developer and City take additional measures to prepare for and mitigate secondary impacts as outlined above.

ZONED OUT: BROOKLYN INDUSTRY WANTS TO GROW, BUT CONTINUES TO BE PUSHED OUT BY REZONING AND BAD ZONING

Yesterday, Crain’s New York Business reported on skyrocketing rents and bidding wars for industrial properties throughout the five boroughs, but especially in North Brooklyn and the Long Island City area of Queens.

Since 2003, rents for industrial space in New York City have risen from $9.90 per square foot, to $14.25. Crain’s points to three factors, all of which imply the crucial importance of protecting industrial land:

1. Growth in businesses that need to be located within NYC, close to the central business district and population clusters, in order to be effective (the article cites food distributors and elevator repair as examples. I would add all kinds of businesses that supply critical support services to the New York City economy, such as Herb Engler’s Penn State Fabricators that manufactures specialty custom parts for construction equipment, or Will Pickering’s Parallel Development that manufactures specialty electronic media arrays (both of whom we interview for The Domino Effect back in 2010 and are located in the GMDC building on Humboldt Street in Greenpoint)

2. The “rampant erosion of industrial locations in recent years, owing to residential rezonings and growth in competing uses such as retailing and hotels.” Crain’s specifically cites the example of the new location for Beacon’s Closet renting at $40 per square foot — more than double its previous price as an industrial property. Williamsburg-Greenpoint has been hit hardest by this, especially in the areas where protection for industrial uses was removed by the 2005 Bloomberg rezoning that allowed as-of-right residential development (such as the area south of McCarren Park along Roebling and Union pictured above). Then there is also the problem of M-1 light manufacturing zoning’s failure to protect industrial businesses by allowing retail, bars, hotels, and bowling allies. This problem is most acute in Long Island City where dozens of hotels have sprouted but is also a huge and growing problem in Williamsburg (the Wythe Hotel area), Bushwick (especially around the Morgan L stop), and now even Ridgewood and Maspeth.

3. “Little if any new industrial property has been added. Those few new structures generally have been snapped up immediately.” This is again, due to the lower immediate financial return to a developer compared to building high-end residential or commercial. It doesn’t help that the tax incentives and City support for new industrial development pale in comparison to the residential giveaways like the 421a tax break.

Despite the clear and growing demand for industrial spaces, the notion that industry is “the past” and “is leaving” continues to be repeated by some influential planners and policymakers.

In his “One New York Rising Together” policy platform, Mayor De Blasio expresses support for New York’s industrial economy and calls for creating “economic development hubs” in every neighborhood to “map the economic assets, industries, needs and human resources in each neighborhood” and “assess where supply chains go, what financing is needed, how to assist in finding and training employees, and other guidance to help each industry become a high-productivity, high-wage part of the city economy.”

If De Blasio follow through on this plan, it may finally lead to relief for North Brooklyn’s industrial businesses under siege from speculators. In the last 25 years, numerous planning studies have examined the economies of North Brooklyn and Long Island City and urged for greater protection for industrial land from real estate speculation (see the work of Laura Wolf-Powers especially “Up-Zoning NYC’s Mixed-Use Neighborhoods” as a particularly excellent guide to this issue). The Bloomberg administration generally did the opposite and actively encouraged conversion of industrial areas.

I hope the new administration and new leaders of the City Council waste no time in getting to work on fixing our policies to protect and grow industry in North Brooklyn and the Long Island City area.

 

FULL SPEED AHEAD AT DOMINO AS COMMUNITY BOARD HOPS ABOARD THE TWO TREES EXPRESS

reynoso at CB

 

 

 

 

 

 

 

 

 

 

 

Reynoso comes out in support, Levin pulls a disappearing act, and Domino developers succeed in winning Community Board approval with weak “conditions” attached

Last Tuesday, December 10th 2013, Brooklyn Community Board 1 voted overwhelmingly in favor of approving a “Yes with conditions” vote on Two Trees’ Domino project. The vote was roughly 20 to 25 in favor, 4 against. Councilmember-elect Antonio Reynoso announced his official support of the project for the first time and Two Trees’ Jed Walentas and David Lombino celebrated immediately after the vote by distributing a press release announcing the project’s continued progress.

Although I was optimistic that the Board might take a stronger stance against Two Trees after the Domino public hearing held on 11/21/13, the development is once again shaping up to be a prime example of the pitfalls of the New York City land use process.

The Land Use Committee’s resolution was developed by committee chair Del Teague (affiliated with local non-profit People’s Firehouse) and Rob Solano of Churches United for Fair Housing. According to those present at the land use committee hearing, which was held 11/25/13, Solano was the driving force behind the resolution and decision to vote “Yes” with conditions.

The “conditions” accompanying the “yes” vote are as follows (my paraphrasing):

  1. Mandate that Two Trees include 660 units of affordable housing as at least 500,000 square feet of floor area
  2. Lock in the shape and size of the buildings as presented by ShoP architects
  3. Two Trees must partner with local non-profits, as soon as the project is approved, to assure adequate local recruitment and education of local residents and commercial tenants
  4. Two Trees must offer incentives and “reasonable preferences” to local businesses for the commercial spaces
  5. Affordable housing will include three bedroom apartments and breakdown by units as follows:10% studios, 25% one bedrooms, 50% two bedrooms, 15% three bedrooms
  6. Affordable housing AMI’s shall range as follows: 30% less than 40% AMI, 25% less than 60% AMI, 25% less than 80% AMI, 20% less than 125% AMI.

Compare to the comprehensive community benefits I testified for and those advocated for by El Puente (which included assuring the open space would be publicly owned, that Two Trees pay a into a Southside Parks Fund Endowment, incorporate renewable energy and on-site recycling, incorporate real community-run facilities, and memorialize all of this in a binding community benefits agreement with oversight) and this list of “conditions” is rather meager indeed.

Requesting that 660 units of affordable housing be locked in through a restrictive deed is a good step but 500,000 square feet is only slightly more than the 456,333 square feet (20% residential floor area) proposed by Two Trees in their technical memorandum. 500,000 square feet of affordable housing would represent less than 17% of the total built square footage of the project and only 22% of the residential square footage. If Two Trees were to build the range of units proposed by Community Board 1 ­this would result in fairly small apartments – the average affordable apartment would be 757 square feet, making it difficult to fit in 65% of the 660 units as two and three bedroom apartments.

And under the Land Use Committee’s proposed AMI levels, only 55% of the affordable housing units would be affordable to the majority of Community Board 1 households.

Other than the conditions for affordable housing, there is nothing solid in the Land Use Committee’s report on the crucial issues of open space, job training, and infrastructure. And despite any conditions that are attached, a “Yes” vote by the community board will be interpreted as support for the plan and will be reported as such in the media. At the future steps of the ULURP process, the “Yes” vote will be constantly invoked by Two Trees as evidence of local support for their proposal. The nuance of voting “Yes” with conditions will be lost.

I was under the impression that both Councilmember Levin and the soon-to-be Councilmember Reynoso wanted to achieve a better deal for affordable housing and community benefits than Two Trees is currently proposing. It would stand to reason that a “NO” vote on this project would give the Council Members greater leverage in negotiating for better public benefits.

Yet before the vote was taken, Reynoso announced his support for the Land Use Committee’s resolution and for Two Trees’ project overall. But he noted that “in saying that, it doesn’t mean we are’ not going to hold them accountable to our requests.” How Reynoso plans to “hold them accountable” after seemingly surrendering the vote in the City Council, his only bargaining chip, remains to be seen.

At least Reynoso was present at the meeting however, which could not be said of Councilmember Steve Levin. Levin was apparently not involved in the Land Use Committee’s drafting of its resolution, where he could have had a considerable influence working with Del Teague and other members of the board to produce a much stronger committee report. By failing to influence the Land Use Committee’s report on Domino, Levin appears to have abdicated his role in the approval process.

Before the Community Board vote was finally taken, board member Esteban Duran spoke against the Land Use Committee’s resolution, lamenting the lack of more specific commitments to the community and urging the board to learn from its past experience with developers like the Community Preservation Corporation, who made many promises but then failed to deliver. He specifically noted the lack of a binding community benefits agreement and community oversight board. After Esteban spoke, Rob Solano addressed the board, once again urging a vote in favor because of the dire need for affordable housing.

The vote was taken and only Esteban Duran, Tom Burrows, and two others (it happened so fast I couldn’t see who they were) voted against the resolution. Certain other members of the board who may have been inclined to vote “no” told me that although they were disappointed with the Land Use Committee’s report, they saw no purpose in voting “no” because voting “no” would not allow an opportunity for the Board to reconsider and draft stronger recommendations.

After the vote, Antonio Reynoso left the room, stopping to give Two Trees’ Jed Walentas and David Lombino a handshake and pat on the back on his way out.

In the end, as is usually the case with New York City development, the public process at the Community Board level was theater with the closing act prearranged. Two Trees met with the Southside’s most prominent “affordable housing” advocates– Los Sures Southside United HDFC (led by Ramon Pigeuro) and Churches United for Fair Housing (led by Rob Solano) in early 2013 and apparently won their support by promising to maintain “660 units”. Solano in particular has been quoted as supportive of Two Trees in nearly every article that has been written on it.

This pattern of local non-profit organizations working out deals with developers in advance of the ULURP process has been a constant at Community Board 1 for many years and is not unique to either Los Sures or Rob Solano.

As another longtime observer of Community Board 1, Heather Letzkus of “New York Shitty” described it recently after observing the process on Greenpoint’s 77 Commercial Street project:

A great many of the community organizations here, while certainly founded for laudable reasons, seem use these proceedings not so much to reflect the sentiments/interests/needs of the community they represent. Rather, they are a means of getting a “cut” of the action. Thus time is spent debating how many angels can sit on the head of a pin instead of examining “the larger picture” in any meaningful fashion.”

New York City developers have become highly skilled at dividing communities by promising relationships with certain community organizations in exchange for their support. They take advantage of these organizations’ constant struggle for resources and keep them focused on reactive short term dealmaking instead of long term community planning.

It is worth pointing out that El Puente, with its Greenlight District Initiative and its extensive suggestions for improving community benefits in the Domino plan, is a promising exception to this pattern.

But overall, the City is in desperate need of an overhaul of the land use review process. Specifically, the new administration must develop an open and transparent process for negotiating community benefits agreements and must ensure that all such agreements are always legally binding and enforceable. One intriguing notion discussed at a recent meeting of Participatory Budgeting NYC was the notion of using participatory budgeting to develop community benefits agreements. What an incredible improvement that would be over these backroom negotiations between nonprofits, developers, and Councilmembers.

 

 

TWO TREES’ HOLLOW PROMISES

TWO TREES AT THE COMMUNITY BOARD

Last week, on Wednesday November 13, the Two Trees Domino roadshow hit Community Board 1 for the first required public hearing of the Uniform Land Use Review Process (ULURP).

Despite their official role in the ULURP, Community Boards are not provided with the funding necessary to hire their own planners to objectively analyze and evaluate proposals. So unless there are planners who are board members and have the time to engage, or local non-profits with staff or volunteers able to, there is no one to objectively scrutinize proposals and hold developers accountable.

Since I’m a planner who’s been following the Domino development for many years, I feel compelled to engage in the process and offer a counter-analysis to the skewed self-interested version presented by the developer. I have no personal grudge against Two Trees and in certain ways – namely the inclusion of significant commercial space and commitment to non-chain “neighborhood” retail – I actually think the Two Trees plan is superior to the Community Preservation Corporation’s.

I continue to believe that 3 million+ square feet is far too much for this site, and in an ideal world at Domino we would be considering creative alternatives that would find greater synergy with the existing local economy and community…an industrial/creative business incubator, a new university branch (there’s clearly demand – see the Roosevelt Island tech campus), a combination of such developments with 1,000 units of mixed-income housing – the possibilities are limitless if we stop insisting on shoehorning 3 million square feet of development into this site.

But let’s for a moment concede that Two Trees is likely to proceed with a plan that generally follows their proposed framework. If we set aside the issues of density for the moment and simply evaluate the Two Trees proposal on the basis of its touted public benefits of “affordable housing” “jobs” and “open space,” it becomes clear that these measures fall far short of truly benefitting the public and local community. If Two Trees is truly interested in building for the long-term benefit of this community, the public benefits should be defined, strengthened, and locked into a binding restrictive deed.

In the following, I’ll outline precisely how the Two Trees’ current proposal is failing the public and how it could be strengthened to actually live up to the promises the developer is proclaiming.

Has the plan changed since its debut last Spring?

Two Trees finally got the go-ahead from the City Planning Commission on November 4th.Two Trees’ Domino plan arrived at the Community Board only nine days after being officially certified by the City Planning Commission on Monday, November 4. The certification of the project came after a roughly three-month delay of deliberations and negotiations between Two Trees and the City Planning Commission over issues of height, density, and additional commercial space.

 

 

 

 

 

 

 

 

 

 

 

 

 

As a result of the extended back-and-forth with City Planning, the Two Trees plan has undergone certain modifications from the version that was presented to the community last spring.

 

Two Trees Proposal 3/13

Two Trees Proposal 11/13

Residential SF

2,283,974

2,281,666

Commercial Office SF

631,508

504,308

Retail SF

78,729

72,407

Community Facility

131,000

150,935

Additional Total SF from 2010 Plan

+310,180

+236,515

Parking Spaces

1,193

1,050

Height of Site A (northernmost site)

422

435

Height of Site B (large “donut” building)

518

530

Height of Site D (southernmost site)

538 and 598

435 and 535

Height of Site E (inland site)

230

170

While the residential square footage remained almost the same, the proposed commercial office square footage dropped by about 20% from over 630,000 to just over 500,000. Retail square footage dropped slightly and community facility square footage increased by about 15%. Overall, Two Trees is now asking for 236,515 additional square feet compared to the 2010 plan. The number of proposed parking spaces was further reduced to 1,050.

Compared to the initial proposal, the maximum height of the southernmost towers next to the Williamsburg Bridge is reduced from 598 feet to 535 feet, so the development  now tops off at the southern towers and the large “donut building” at roughly 53 stories. The height of the inland building was also significantly reduced from 230 feet to 170 feet.

The overall programming and scope of the development is pretty much the same however, and the Community Board was presented with a very similar slideshow to the one first presented back in March and April, presented by Jed Walentas and Vishaan Chakrabarti of SHOP Architects.

What is the value of the requested action?

One of the first things that anyone evaluating a ULURP proposal should consider is “what is the value of the action?” How much does the developer stand to gain from the zoning change?

This is a critical piece of information when thinking about the public benefits that should be included in the proposal. Yet under the current ULURP regime, it is almost never asked.

Two Trees is asking for additional height and density to be added to a zoning that is already significantly more dense than the rest of the Williamsburg-Greenpoint waterfront. Even after the negotiations with City Planning, the plan requests an additional 236,515 square feet – essentially equivalent to added another 20 story building to the site – and an additional 19 stories into the sky.

The 236,515 square feet Two Trees is requesting is commercial space projected to rent at $25 a square foot (per year). This translates into an extra $5.9 million annually. Then there is the value of the additional height in the building. Higher floors in a high-rise luxury residential building are clearly valued at a premium over lower floor. Most estimate this premium to be about 1% each floor.  The additional height will clearly add significant value to the apartments, at least $5 million+ annually (consider just a 10% boost in value to 1,000 apartments that would have rented at $5,000 a month but rent at an average of $5,500 a month instead due to the height premiums means $6 million extra in rent)

It is conservative to estimate that the additional height and density proposed by Two Trees at Domino would net the firm at least an additional $100 million in revenue over 10 years.

 

DECEPTIVE MARKETING

How can developers sell the public on granting additional development rights without also increasing the public benefits?

As Phil DePaolo explained so well in his WG News column last month, developers in New York have grown accustomed to selling their plans to the public with deceptive practices akin to those employed by cereal companies like Kellogg’s when marketing sugary cereals like Honey Smacks or Cocoa Krispies.

Promises of affordable housing” “open space” and “jobs” are proclaimed over and over again and reinforced by glossy renderings and official-looking tables of numbers supposedly representing the benefits. At public hearings, the developer always presents first and is allowed unlimited time to set the tone, establish the parameters of discussion, and sell the audience on the project. This is a depressingly familiar script to anyone who has attended a ULURP hearing and the story was once again the same last week at Community Board 1.

Let’s take a look at Two Trees’ golden promises of “affordable housing” “open space” and “jobs” and see how they stack up to reality:

“AFFORDABLE” HOUSING

“Affordable housing” was of course the primary selling point of the original 2010 Community Preservation Corporation “New Domino” plan. Community Preservation Corporation won the support of numerous Southside churches and community organizations including Los Sures and El Puente by promising that “660 units, 30% of the total.”

The exact definition of “affordable” is established by targeting the units for the incomes of households making a certain percentage of the “area median income” (AMI), which is unfortunately established by looking at all the households in New York City and its suburbs and picking out the exact middle of the distribution – which in 2013 is currently $85,900 for a family of four. If an affordable housing unit is targeted at households making “60% AMI”, the rent levels will be affordable for a family of four with income of 60% of the AMI of $85,900, or $51,540. “Affordable” is considered 30% of income, so one can get to the average monthly rent by multiplying the income of $51,540 by 0.3 and dividing that by the 12 months in the year, leaving us with rents of $1,288 a month.

The gaping flaw in this system of establishing “affordable housing” is that for gentrifying neighborhoods in New York City, the area median income is far lower than it is for the entire region.

In Brooklyn Community Board 1, the AMI is only $41,540. In plain English, that means that half of all community households make less than $41,540. This means that in order to get the “affordable housing” to actually be affordable to the majority of community households in Community Board 1, it has to be targeted at 30% to 50% AMI. 60% AMI will be helpful to some in the community under pressure from displacement, but anything higher than 60% AMI and we really can’t consider it “affordable housing” for Community Board 1 in any meaningful sense of the term. Just like those Honey Smacks in reality can never be considered “part of a balanced breakfast.”

Back in 2010, the Community Preservation Corporation was promising 660 units broken down as follows:  100 apartments at 30% AMI, 100 senior housing units at 50% AMI, 310 apartments at 60% AMI, and 120 “affordable home ownership” units at 120% AMI. So while only the 100 apartments at 30% AMI would reach the majority of those in need, at least 510 of the 660 units were for 60% AMI or lower. Not ideal, but markedly better than most other development proposals in Community Board 1.  Community Preservation Corporation was also promising a diverse mix of apartment sizes with significant numbers of larger 2 and 3 bedroom apartments.

We must remember that the promise of this affordable housing, this specific offering of affordable housing at lower income levels and large sizes, was what brought out community organizations in support of the 2010 plan. Community Preservation Corporation would have never won the rezoning of Domino Sugar at such density if it was not for the political support of Southside community organizations and Councilmember Diana Reyna. It is that simple. But unfortunately, Community Preservation Corporation’s promises were formalized by a non-binding “memorandum of understanding” that Two Trees has said it will not follow.

Nevertheless, Two Trees, the inheritor of the Domino site and its lucrative zoning with the promise of hundreds of millions if not billions of profit, has a lot to owe those Southside groups.

As a result, Two Trees is “promising” to fulfill the oft-repeated pledge of “660 units of affordable housing.” But the developer is banking that the Williamsburg community is complacent, distracted, or ignorant enough to accept that at face value.

Here’s the reality check of Two Trees’ “affordable housing” pledge

–        Since Two Trees is proposing over 2,200 units, “660” affordable units now represents less than the promised “30% of the total”

–        Two Trees is requesting that only the residential floor area of the development be counted towards its allocation of affordable housing and is committing to allocate only 20% of it.

–        Since the Two Trees proposal reduces the residential square footage compared to the 2010 plan by 160,639 feet, Two Trees is actually proposing less affordable housing than is locked in under the existing zoning.

–        Do the simple math on the square footage Two Trees wants to allocate to affordable housing and we find that Two Trees’ average affordable unit will be less than 700 square feet large. (2,281,666 of total residential square footage X 0.2 (20%) = 456,333 divided by 660 units = 691 square feet each unit)

–        This was confirmed at last week’s meeting when we learned that Two Trees wants to build only a handful of two-bedroom units at Domino and no three-bedroom units at all.

–        Two Trees is promising only a handful of apartments at 40% AMI and the rest will be significantly at higher incomes, leaving out those households that are under the most displacement pressure.

–        One positive measure Two Trees is taking is the promise that all affordable units will be fully integrated and indistinguishable from market rate units.

–        No commitment to fund the “Mobilization Against Displacement” collaborative to help alleviate secondary displacement that the project will undoubtedly accelerate.

In sum, the “affordable housing” plan has absolutely nothing to offer the low-income families of the Southside that are being pushed out of the neighborhood by gentrification. Families with children struggling to get by at incomes of $20,000 to $40,000 will have no relief from displacement pressure by anything proposed by Two Trees’ Domino. Affordable housing is supposed to be the golden promise to help counter gentrification and allow the existing community to share in the growth of the neighborhood, yet this plan shuts them out nearly entirely.

If Two Trees wanted to build with the local community in mind, they would keep all AMI’s at 60% and lower, and build fully 30% of the floor area as affordable housing to allow for more two bedroom apartments and the inclusion of three bedroom apartments for families.

With a new Mayor taking office who’s dedicated to changing the direction of the city to foster more inclusive growth and development, there’s no reason not to expect that the City could contribute more resources to ensure that the Domino affordable housing is actually affordable. If Two Trees’ has to lose a few million in profit in order to accomplish this, that should be part of doing business in this City, especially when the developer is poised to make huge profits off a rezoning that would have never gone through if not for the efforts of affordable housing advocates.

OPEN SPACE

“Open Space” is the second major selling point of the plan, and Two Trees is proudly proclaiming that their plan provides an additional 2 acres of open space compared to the 2010 plan.

But looking at the details, the majority of this additional space would be taken up by the proposed extension of River Street through the site as a “private drive.” 1.31 acres of the claimed additional 1.98 acres is taken up by the additional streets and sidewalks. Taking this into account, the Two Trees plan would do nothing to improve the abysmally low open space ratio on the Southside.

Then there are concerning issues of just how public the open space will be. Two Trees is noncommittal to transferring the new River Street over to the City and is opposed to turning over the other public spaces at Domino to City Parks. This raises the question, why would the community prefer a slightly larger piece of private open space to the public open space promised by the 2010 CPC plan?

Moreover, renderings and diagrams Two Trees has created to illustrate uses at the proposed “Domino Square” (the large open parcel that is the company’s justification for building taller) depict flea markets, banquets, and cocktail parties where public access would clearly be restricted and curtailed. The constant occupation of East River Park by these private uses is spurring considerable controversy in Northside Williamsburg.

It is completely unclear how often the proposed “Domino Square” will be occupied by this kind of event programing, how curtailed the public access will be when these events are taking place, and what kind of access local community organizations will have to hold events. And if the “public” spaces are privately owned and operated by Two Trees, will they have the right to establish their own rules and regulations governing access and uses? Will Two Trees have its own private security patrolling the “public space”?

Maintaining the public spaces in private hands is a dangerous precedent to set on the waterfront where public access and ownership has been a core promise of City government for decades. Two Trees should commit to turning over the public spaces to the City and be very clear in establishing how access to “Domino Square” will be decided and regulated.

Other actions that Two Trees could take in support of open space in Williamsburg include making a financial contribution to the development of “Williamsburg Bridge Park” on the city-owned lots under and adjacent to the bridge. Two Trees has already claimed they will “support” such efforts but they have not committed to financially contributing. Two Trees could also make a financial contribution to the further development of Bushwick Inlet Park just up Kent Avenue from Domino. Both of these actions would be true “win wins” – increasing Two Trees’ property value at Domino while contribution to meaningfully expanding open space in Williamsburg.

JOBS AT DOMINO

The final aspect of the holy trinity of promised community benefits is “Jobs.”

One of Two Trees major selling points is the provision of an additional 405,570 square feet of commercial office space in the development that will help create“3,000 new jobs.” But just as we must ask “affordable housing for whom?” we must also ask “jobs for whom?”

All of the public comments Two Trees has made about the proposed office space indicates that it is intended for companies in the tech and new media sectors. The developer holds up Vice Media as an example of the kind of company it’s office space will be geared for.

So who will be holding these promised 3,000 new jobs? The answer is mostly young white men. American Community Survey data tells us that more than two thirds of workers in the tech and media sectors in the New York City area are white. Only 8% are Hispanic/Latino.

Yet Two Trees has not proposed any programs or efforts to try to improve the access of communities of color to career opportunities in the tech sector. Community Preservation Corporation had committed to job training programs in the 2010 plan but there has been total silence from Two Trees on this issue. In addition to job training, access to affordable broadband access is a major issue for working class-communities. Two Trees could make a valuable contribution by offering free- wi-fi access throughout Domino’s public spaces and community facilities.

In contrast to tech and media jobs, the workforce for industrial jobs is majority people of color and foreign born. Two Trees could commit to preserving a portion of the commercial space at Domino for light industrial businesses. There is also the issue of the numerous lots directly north and inland from Domino that remain zoned M-3 for industrial uses. Will Two Trees support maintaining the industrial zoning or will it seek to rezone these areas for more residential and retail?

INFRASTRUCTURE

Beyond making sure the advertised community benefits of “affordable housing,” “open space,” and “jobs,” are actually meaningful, there is also the issue of the development’s impact on local infrastructure.
In hundreds of other cities across the country, it is common practice to assess developers “impact fees” to help pay for new and improved infrastructure.

According to Two Trees, the proposed development is expected to generate roughly 2,000 additional subway trips during weekday rush hours, roughly 650 more than the 2010 CPC development. These numbers assume only 55% of trips to the site will be by subway or bus, while in Community Board 1 as a whole, over two thirds of trips are made by subway or bus, so the additional subway trips may be considerably higher than Two Trees is projecting

While Community Preservation Corporation pledged to create a shuttle bus to the Marcy JMZ stop to reduce pressure on the Bedford L, Two Trees is proposing shuttle buses to both the Marcy JMZ and Bedford L. The Bedford L station is already dangerously overcrowded.  If Two Trees is going to run a shuttle to the Bedford L, the developer should commit to help fund improvements to the station to alleviate the dangerous overcrowding that already occurs at rush hours. The work that would make the greatest immediate impact would be the construction of additional stairwells to the station from the street at Bedford Avenue. Two Trees could also help lobby for the City to undertake a comprehensive transportation study of North Brooklyn.

New York City is so far behind best practices in development and planning. We need to start undertaking comprehensive urban planning in order to make sure that growth is equitable, sustainable, and rational in relation to the greater public interest. If developers like Two Trees want to build thousands of units on the Williamsburg-Greenpoint waterfront, the cost of the improved infrastructure should not rest wholly on the regular New York City taxpayers. It’s not a radical proposition.

The Bloomberg era is over. This project will be the first ULURP to greet our new Borough President, City Planning Chair, Council Speaker, and Mayor. This project will be their first opportunity to send a message that the old Bloomberg way of doing business, of huge giveaways to the real estate industry at public expense, is over. The rezoning of Midtown East that was being pushed by the Real Estate Board of New York, another proposal with very vague and unclear public benefits, was just killed by the City Council last week. The status quo is already changing.

Unless Two Trees starts lay out specific substantive community benefits that will be legally locked-in to this project, the Community Board should send a message and vote NO.

DOMINO SCREENING AT BEDFORD & BOWERY NEWSROOM BRINGS TOGETHER DIVERSE PANEL TO DISCUSS NEIGHBORHOOD DEVELOPMENT

This past Friday evening of October 25th, “Bedford + Bowery” – the media collaboration between New York Magazine and NYU’s school of journalism – hosted a screening of The Domino Effect followed by a discussion panel on the wider issues of development in Williamsburg. Roughly 30 people attended the event for the screening and the panel – which was livestreamed and remains archived. Derick Dirmaier of Bedford + Bowery moderated and organized the screening.

The panel included myself and Domino Effect co-director Daniel Phelps and three guest panelists with diverse backgrounds and experiences – Esteban Duran, Williamsburg native, longtime Community Board 1 member and community organizer with El Puente, Colin Miles, founder of “Save Domino” and a Williamsburg resident of over a decade, and Daniel Campo, urban planning professor and author of “The Accidental Playground” who spent years undertaking ethnographic research on the Williamsburg waterfront in the late 1990’s and early 2000’s. Campo also worked for the Department of City Planning’s Brooklyn office in the mid 1990’s. Stephanie Eisenberg, a local resident, industrial business owner and longtime opponent of plans for high-rise residential development at Domino Sugar, also participated in the conversation at numerous points.

The panel offered the rare opportunity for local activists and urban planning experts to discuss development in an open public forum, exchanging ideas and finding common ground on many issues.

Issues discussed included industrial retention, the effects of the 2005 rezoning, segregation of affordable housing in separate buildings, Two Trees’ open space plan, and the challenges of engaging local residents in activism. Below I provide highlights of the conversation.

Early in the panel, Esteban Duran, who prominently supported the Community Preservation Corporation’s “New Domino” plan during the 2010 rezoning process, expressed frustration at the way in which supporters were “duped.” CPC’s promises of community benefits were ultimately cast aside when the company got into financial trouble and sold Domino to Two Trees for $185 million in 2012 (CPC paid $55 million for the site in 2004).

“It’s fair to say that we were duped…there were a lot of promises that were made including homeownership, CPC did have a track record of producing affordable housing…we were really focused on the need for affordable housing and I think moving forward there’s an opportunity to work together to make sure that whatever happens next is something that we agree is best for everyone, although that’s always hard to find.”

Esteban’s comments reflect the widespread frustration by many in the community that the benefits promised by CPC in exchange of the rezoning – most prominently the vow of “30% affordable housing” including home ownership units and senior housing – was not written into the zoning as a legally binding restriction but was instead memorialized as a “memorandum of understanding” that Two Trees is not required to follow. While publicly promising 660 units of affordable housing, Two Trees has been very vague on the specifics of their proposals and the percentage will not reach 30%.

Daniel Campo weighed in on the debate about the benefits of “affordable housing” as a small percentage of luxury towers, noting very similar development trends he has witnessed in global cities around country such as Toronto and Vancouver. Considering the flow of global capital into these cities Campo noted that “it’s going to take more than just a few incentives” to create a situation in which the community actually benefits in this growth. “We have to think a little differently than the way we’ve been thinking…the film captured the Bloomberg ideal that real estate development will solve every problem in the City…we lost a lot of value that could have been pulled out of these rezonings…but the Bloomberg administration is leaving and we have an opportunity to impress upon Bloomberg’s successor that there are alternatives.”

Campo also criticized Two Trees’ open space plans as “generic waterfront” esplanades and plazas that be found in any city, rather than plans tailored to the needs and strengths of North Brooklyn. Esteban Duran raised concerns about “what the open space is going to be, how it’s going to handled because we do want to make sure that it’s something very inviting and allows for real community exercises and activities to happen and we should welcome collaboration to discuss that.”

Colin Miles noted Williamsburg’s very low ratio of open space/population and correctly recognized that Two Trees’ proposed Domino open space would do nothing to actually improve the open space per person in the neighborhood because of the thousands of new residents and office workers the development would bring in. More generally, he also noted the extreme lack of public investment in Williamsburg-Greenpoint in comparison to the tidal wave of private real estate capital flowing into the neighborhood. Community infrastructure has not kept up with the growth.

Beyond the debates over specific developments, this is indeed the overarching issue – the lack of public action and investment in comparison to the flood of private dollars. When asked by an audience member what solid actions the City government could take to combat gentrification and environmental injustice, I noted the complete lack of comprehensive urban planning – at the community or citywide level – in New York City. Other cities send their planners into neighborhoods to comprehensively analyze the environment, economy, and social structures and work with the community to develop strategies for broad and equitable growth. New York City under Mayor Bloomberg simply uses zoning as a blunt instrument to spur investment.

Daniel Campo correctly pointed out that there’s nothing preventing the city and state from re-engaging in more direct forms of affordable housing development such as the Mitchell Lama program, 100% affordable housing development not hitched to luxury housing. He also observed that more parkland could be built if the City was more open-minded about the definition of a “park” – not every park needs to be lavished landscaped and designed.

Later, an audience member asked the panel about our “personal motivations” for getting involved in local activism and development issues. Colin Miles answered first: “Save Domino is about more than Domino, it’s about getting people aware of the issues and what’s going on around them…a lot of the people don’t give a shit. We’ve petitioned every day and some people don’t care, they’re like “what do I care, why are you bothering me?” The problem is the communication, they’re not aware of the issues. I used to be that hipster do didn’t give a shit…now we’re building a counter-campaign to deal with all of this but it takes time…we want to work with the community and work with government to change things but it’s not going to change overnight.” “

Esteban Duran emphasized that “It’s important to look at what happened in that process of the rezoning of Domino…as much I was want to focus on the new, I think that we as a community…we also have to look at the fact that we were duped by CPC and we deserve to be reinvested in by CPC. Because we bailed those bastards out…they completely turned their backs on this community while they reaped a windfall of over $100 million. So I think that’s another issues that we can’t forget about…where are we holding this corporation responsible for having this project and selling it? How are you going to come back and help this community out? We need to keep an eye on them and make sure they come back and invest in this community.”

The City should examine what’s happened at Domino and learn that much stronger, binding community benefits agreements are an absolutely necessity in holding developers accountable. Esteban’s call for a campaign to hold Community Preservation Corporation accountable for their failed promises is an compelling idea – since CPC profited $130 million on the sale of Domino, would it be unreasonable to ask that half of that sum be reinvested in Williamsburg developments of 100% truly affordable housing, including home ownership opportunities and senior housing as promised in 2010?

Stephanie Eisenberg weight in from the audience and implored the panel to “stop using the word gentrification. What happened to this community is not gentrification…I call it “class warfare” because the rezoning actually promoted gentrification, it’s not a process that just “happened.” It’s a process that landed on us…changing the classes, getting rid of manufacturing, saying “manufacturing is dead.” The City deliberately did this, it’s not accidental…we’re all in the same boat. And by dividing this community and having the “affordable housing” people on one side and predominantly the “newbies” and white people on the other side, the City has achieved their goal…Now if you’re willing to all get together we can do something…but if we continue on this path of “you go your way, we’ll go our way,” you’re going to get screwed again and I’m going to be really pissed off because…I don’t want to live in DUMBO! And that’s what you’re going to get with Two Trees.”

Esteban responded directly to Stephanie stating“We need to have more dialogue…I want to make sure we say to the point that I think we should not be divided in any way. There should be real discussions, the divide and conquer strategy is effective…and in this go-around we should not allow that to happen. And that’s not going to happen by there being enlightenment, by there being a real discussion of what we want out of Domino, also knowing that Domino is not going to solve all our problems, and also looking back at how we’re going to hold accountable the entity that turned its back on this community (Community Preservation Corporation)…this is something that can’t be done alone and has to be done with everyone.”

After viewing The Domino Effect where the disagreements between those in the community who supported Community Preservation Corporation’s Domino plan for its inclusion of affordable housing and community facility space and those who opposed the development seemed unbridgeable, this dialogue was highly encouraging.

Near the closing of the panel, Colin Miles summed up the issues facing Williamsburg-Greenpoint: “We have so many quality of life issues facing us outside of Domino. Then you bring in Domino, doubling the population because of the waterfront development…What’s our quality of life going to be in 10 years? The Community Board can only make suggestions…they have their ear to the ground and then they can’t do anything about it.”

Indeed, we cannot rely on the community board or any of the existing nonprofit organizations in the neighborhood to solve the intractable issues of development on their own. Only if more residents get involved with new forms of organization and collaboration can we hope to make an impact on the new administration and shift the destiny of development in Williamsburg-Greenpoint.

FROM “POOR DOOR” TO “POOR HOUSE” : PROPOSED 421-A RULE CHANGE COULD FURTHER ENABLE SEGREGATED AFFORDABLE HOUSING ACROSS THE CITY

On Friday October 4th, HPD held a public hearing regarding a rule change for the 421a program that was specifically requested by Two Trees for the Domino Sugar development. “421a” is the name of the property tax break that developers receive in exchange for providing at least 20% “affordable housing” in the development. For a project like Domino, it is worth tens of millions of dollars (see my previous blog on 421a for more)

The Domino property includes the five block long waterfront complex as well as the large parking lot across Kent Avenue that is currently serving as the pop-up “Havemeyer Park.” The current 421a rules would require the waterfront section to include at least 20% affordable housing. But Two Trees would prefer to build most of the affordable housing away from the waterfront on the inland parcel to maximize waterfront profits.

To do so while also receiving the multi-million dollar 421a tax break, Two Trees needs a rule change from HPD that would consider the waterfront and inland site a single “covered project.”

The proposed rule change would allow lots across the street from each other to county as a single project and affects not only Domino but projects across the city. “On-site” affordable housing could actually be built across the street from the luxury portion in an entirely separate building.

Below is the testimony I submitted to HPD on this issue:

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TESTIMONY OF BRIAN PAUL TO NEW YORK CITY HOUSING AND PRESERVATION DEPARTMENT Regarding proposed change to Subdivision (c) of Section06-01 of Chapter 6 of Title 28 of the Rules of the City of New York by amending the definition of “Covered Project”  

Within the exclusion zone on the Williamsburg waterfront, the 421a tax abatement, alongside the inclusionary housing program, is intended to incentivize the production of on-site affordable housing in new developments.

During the 2005 rezoning of the waterfront, as well as the 2010 rezoning of Domino Sugar, “affordable housing” on the waterfront was the key community benefit claimed by supporters and City government. The goal of this policy is to encourage socio-economic diversity and allow longtime residents of the neighborhood a chance to participate in the economic growth and remain in the neighborhood

But in the projects that have been built so far on the waterfront, Northside Piers and the Edge, we have seen the spirit of this policy violated as affordable housing is constructed in structurally separated low-rise buildings on the back end of the towers, with separate entrances and no access to building amenities.

This method of segregating the affordable housing through a separate “poor door” has been widely criticized by City leaders. Two Trees’ Jed Walentas has also publicly denounced it and promised that his Domino development would be different. Now, however, we see this special request to HPD to change the rules for 421a to allow Two Trees to concentrate its Domino affordable housing at the upland site across Kent Avenue.

If Two Trees or any other developer wants the tens of millions of dollars of public money offered by the 421 tax break, affordable housing should be top quality and integrated throughout the development.

At a time when more New Yorkers are advocating against the “poor door” segregation of affordable housing, this rule change would be moving policy in the opposite direction. While Two Trees claims they will only put about half their affordable housing units on the inland parcel and that it will not be a segregated affordable housing building, with this rule change there is nothing to stop them from doing so if they needed to “cut costs” in the future, and nothing to stop a new developer if the site once again changes hands.

Moreover, changing the rule for 421a to allow adjacent tax lots separated by a street to count as single “covered projects” would allow developers the flexibility to pursue even more egregious “poor door” segregation of affordable housing. This rule change would appear to give other developers throughout the City free license to segregate their “on-site” affordable housing in separate buildings across the street from their main developments.

As an urban planner and Williamsburg resident, I strongly urge HPD to consider the larger ramifications of this rule change and firmly reject it

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At the hearing, Two Trees’ spokesman David Lombino testified and once again promised that all affordable housing at Domino will  be fully integrated without separate entrances, and that this rule change is necessary to allow Two Trees to fast track the construction of desperately needed affordable housing units at the inland parcel building which will be built first.
Two Trees’ commitment to integrated affordable housing sis a good step forward. The problem is that it’s just a promise and there’s no mechanism that legally binds Two Trees to fulfill this promise.

The previous owner and developer of Domino, the Community Preservation Corporation, made public promises for years of 660 affordable housing units representing 30% of the total, and of a broad spread of affordability levels including 100 units at the very low level of 30% AMI, senior housing units, and homeownership units. The developer promised all this to the public over and over again. But when it came down to the final rezoning, this commitments were memorialized as a non-binding memorandum of understanding rather than locked into the zoning. Community Preservation Corporation at this point had a sterling reputation, known as the developer who successfully rehabbed the Parkchester complex in the Bronx and helped fund the Nehemiah Houses in East New York. So many assumed that they would fulfill their promises. Fast forward to 2012 and it is suddenly revealed that the Community Preservation Corporation is in dire financial straits due to poor investments elsewhere in the metropolitan region that were negatively impacted by the financial crisis (http://www.nytimes.com/2012/03/15/nyregion/community-preservation-corp-hobbled-by-housing-investments.html?pagewanted=all&_r=0). In order to bail out their organization, the Community Preservation Corporation sold Domino to Two Trees for $185 million. At the time of the rezoning, those who suggested that Community Preservation Corporation might eventually sell Domino after they got the rezoning were laughed out of the room, as the company’s sterling history was often invoked as proof of their impeccability. Now, the promises made by Community Preservation Corporation are worthless. Two Trees says they intend to honor “660 units” but it will not represent 30% of the total and the company has been silent on the issue of affordability levels.

The truth is, unfortunately, promises cannot be relied upon. I am not saying that Two Trees does not intend to keep their promises — but sometimes circumstances change and what was promised is no longer feasible. The bottom line is that this rule change would allow the developer to stack most or all of the affordable housing units in the less valuable inland parcel. What if Two Trees’ financial condition were to be abruptly undermined like what happened to the Community Preservation Corporation? The site could be sold, a different developer could come in and build the inland site as a segregated affordable housing building.

If a binding mechanism were devised to legally require everything Two Trees is promising, regardless of whether the site changes hands, I might feel different about this situation for the Domino site. The rapid construction of affordable units is a valid point but we have to ask more questions — will they be affordable to the people who need them the most? If this is really about rushing to provide affordable housing for those who are being displaced from the neighborhood then the units should be set at 30-40% AMI and reserved for current or recently displaces Community Board 1 residents. Two Trees has been silent on affordability levels so I am skeptical.

Then there is the citywide affect this rule change could have. This rule change allows developers to place their “on site” affordable housing in separate buildings across the street from the luxury development. Think of what could happen in Greenpoint where the developers may be “less enlightened” than Two Trees — it would be like the current situation at The Edge and Northside Piers with segregated affordable housing but even worse — across the street in a separate building entirely, not really part of the waterfront development at all.

We could go from “poor door” to “poor house,” a step backwards from the already unacceptable status quo.