City Hall’s minions will not shut down construction of Jeff Sutton’s game-changing retail project at 100 W. 125th St., which will bring Whole Foods to central Harlem in 2015, faces no risk of being padlocked.
It doesn’t mean the city’s new leadership doesn’t spell a change in the development climate — of course it does. But contrary to fears, it may be more incremental than revolutionary.
Less jittery dealmakers can take comfort in the fact that as a city council member and as public advocate, de Blasio was no knee-jerk anti-development advocate, but more of a pragmatist.
Developers might also have to work harder with the city to negotiate variances from as-of-right regulations at specific sites. While de Blasio has pledged to “demand” that developers create low-cost housing, he has no way to require them to do so in projects requiring no zoning changes, tax incentives or other municipal favors. But he could require more affordable units at sites where developers receive tax-exempt bond financing than those needed under the current 80-20 program. Developers might have to crunch the numbers to see if, say, 75-25 works for them.
The prospect of even incremental new rules can be daunting given the number of things that can go wrong — such as last week’s court ruling to block for now a major part of NYU’s expansion. Yet, the overwhelming majority of new projects are built as-of-right. Real Estate Board of New York president Steven Spinola said, “We believe fewer than 10 percent have to go through ULURP.”
Some fear that even without statutory changes, “progressive” rhetoric from a mayor more passionate about income inequality than about the city’s world-capital status will have a discouraging effect — and that de Blasio’s words alone could stifle development momentum more than 9/11 and the crash of 2009 temporarily did. But the city’s underlying strengths remain. New York’s enduring magnetism continues to attract global wealth and commerce.
Massey Knakal chairman Robert Knakal predicted in the Commercial Observer that 2014 will be a banner year for investment-sale volume and prices, topping the record $62 billion worth of properties sold in 2007. Manhattan office availability dipped to a major market low of 10.8 percent, according to Cassidy Turley’s report on a “monumental” fourth quarter. That was despite the completion of 4.1 million square feet of new inventory. The firm also reported Midtown Class-A asking rents topped $80 per square foot for the first time in five years.