Business is booming in America. The economy is on a record tear, corporate profits are soaring and unemployment is at historic lows — there are more jobs than people to fill them. Occupancy rates are high, cap rates are low and inflation has, allegedly, been modest.
Kenneth Rosen, head of real estate and urban economics at Berkley’s Haas School of Business, wants the real estate industry to enjoy the good times while they last — because they won’t for much longer.
During an event hosted by the Urban Land Institute’s New York chapter last week, Rosen warned of a likely slowdown in 2019 before an inevitable recession in 2020 or, at the latest, 2021.
He pointed to the ballooning national debt, rampant over-valuations in the tech sector, stock market trepidation over the U.S. trade war with China and a convergence of short- and long-term bond yields as warning signs.
“The spread between the long bond and the two-year is nearly inverted, which is to say the 10-year almost below the two-year,” he said. “Every single time, 100 percent of the time, when that inverts, within a year we get a recession. It never fails.”
A rash of financial and environmental deregulation has opened the flood gates for business expansion and, though Rosen worries about the long-term impact of weaker pollution laws, “business feels very positive about that,” he said.
Also, the Republican-driven tax cuts that went into effect earlier this year helped extend the decade-long growth cycle and boost consumer confidence, Rosen said. But that doesn’t make it sound policy.
“We added a trillion dollars a year to the deficit,” he said. “This is pouring gasoline on a red-hot fire and it’s actually the wrong policy at this time, but we’re taking advantage of it. It’s a sugar high, so enjoy it, because when it wears off in the next couple of years, we’re going to see a retrenchment.”
A strong job market — national unemployment is below four percent — has benefited both the multifamily and office rental markets, Rosen said, and kept vacancy rates low in most major metros. Low interest rates and moderate wage growth, however, have kept rent rates fairly steady.
For-sale housing markets have stagnated, however, and not just in cities with high barriers to entry, such as New York and San Francisco, which briefly benefited from foreign buyers investing in luxury condos but have since over-built.
Sales figures have been weak nationwide, Rosen said, with similar trends taking shape in other developed countries such as Canada, Australia and the United Kingdom.
Home sales have stagnated, in part because of rising construction costs, Rosen said, adding that builders and developers have seen inflation levels around three percent, contradicting the Federal Reserve’s approximation, which pins inflation in the low two percent-range.
Rosen believes a 3.5 percent rise will soon be felt more broadly, thanks, in no small part, to a barrage of tariffs deployed by the White House.
There are potential off-sets, Rosen noted, such as the low-cost oil, which he attributes to “the beheading effect” — a reference to Saudi Arabia increasing the global oil supply in return for continued U.S. support in the wake of the state-sanctioned killing of a journalist in October.
“Saudi Arabia is, all of a sudden pumping a huge amount more oil to get prices down at the request of our president and he in turn is supporting their regime,” he said. “But all commodity prices have fallen down so the question is, is it demand side or supply side? I think it’s supply but we’ll have to wait and see.”
Rosen believes the valuation of many tech companies is “crazed” and venture capital activity is beginning to resemble the late 90s, during the tail end of the dot com bubble.
Looking at New York alone, where technology growth has outpaced stalwart industries, such as law and financial services, during this recovery, Rosen sees strong evidence that the next downturn will be sparked by a tech correction.
“We think the valuation adjustment alone means roughly 85 percent of startups will not make it and there will be billions of dollars of losses, but most importantly, they’ll cut back jobs like they did two decades ago at the end of the last boom,” he said. “There’s real value, though, in companies like Google and Apple and other people. They have a lot of cash and cash flow, so it won’t be as bad as all that, but there’s really a strong case to think the technology sector, which has led us up will lead us for a correction.”
In addition to its tax cuts and tariffs, Rosen also has concerns about the Trump Administration’s policy on legal immigration, which he said accounts for roughly 45 percent of population growth and is a key distinguishing factor between the U.S. and other mature economies, such as the U.K. and Japan.
An aging population brings increased health care and pension costs. Without a replacement workforce to cover those costs, Rosen said the country risks further exacerbating its growing deficit.
“I’m worried we’re going to hit a debt crisis, not just here, but worldwide,” he said.
For real estate, that demographic shift creates new development opportunities in the health care and senior living sectors.
Rosen also believes industrial assets will continue to return strong profits to service a growing demand for e-commerce distribution.
Over all, Rosen estimates that the next recession is about 18 months away, though he doesn’t see it being nearly as detrimental as the last downturn in 2008.
Moving into 2019, he expects there to be renewed political gridlock in Washington now that Democrats control the House of Representatives, though he’s hopeful that the split government can cobble together an infrastructure bill. He’s also watching China, not only in how it responds to the U.S. roughneck negotiating tactics, but also how it deals with its own debts.
Other potential trouble spots on the horizon include Brexit, which is set to take place next year, and the ongoing war in Yemen, which could have untold ripple effects.
At home, however, the biggest question is about how the country will respond once the adrenaline shot of big corporate tax breaks wears off, Rosen said.
“We have labor shortages, so we never should have put a big stimulus plan in place,” he said. “We didn’t need it. We needed that in 2009, we don’t need it now, but the president doesn’t have any economic advisors, he has Larry Kudlow, he’s not an economist he’s a talking head and he’s a very smart guy, but this is very bad.”
In a state like New York, transportation infrastructure is vital for growth, and a strong transportation system has proven to bring greater economic and social opportunities, including accessibility to additional markets, employment prospects and increased investments. That is why when public entities decided to make the investments that they did, they knew they would serve multiple generations of Yonkers residents.
The upgraded infrastructure helped make the apartments at Hudson Park much more appealing to a variety of people. The first two buildings are fully occupied, mostly by those who work in but did not want to live in New York City, had a job transfer or wanted an upgrade from their current living situation. The third building will have amenities not included in the first two, including a pool and a room that looks directly over the water. These tenants have not only brought new energy to Yonkers, but also helped lift its financial prospects.
A recent case study by the Urban Land Institute’s Tri-State Land Use Council documented the nearly two-decade process it took to make Hudson Park a success. Sitting on eight acres of former industrial land, this almost forgotten area was in desperate need of revitalization, which had been delayed by community opposition to previous proposals.
In order to entice developers to make investments, the Metropolitan Transportation Authority (MTA) spent $43 million restoring the historic Yonkers train station. Many tracks and bridges needed to be replaced and now riders can enjoy a much better experience. Yonkers is just a 28-minute train ride to midtown Manhattan and these improvements gave the private sector the confidence to develop knowing they could attract commuters.
Making the rezoning process transparent was also a key element to putting shovels in the ground. With the city and nonprofits purchasing the land, these entities were able to share control of the process, helping to ensure any development that took place benefited the Yonkers community as a whole. By involving residents through public meetings, developers and city officials had the opportunity to address concerns they saw in previous plans. The buildings were smaller and included public access to the water. The private investment wouldn’t have come without the city investing over $100 million for a new library, a 610-space parking structure for commuters, critical infrastructure and utilities as well as an esplanade along the Hudson River. In addition, the city passed new zoning codes specifically for Hudson Park, sparking a renaissance for the long-suffering downtown which has spurred further redevelopment.
This development strengthened Yonkers’ long-term fiscal outlook by expanding the tax base. Even though Hudson Park generated additional costs to the city for infrastructure, education and emergency services, estimates show that additional revenue will also be generated through the added tax base. In fiscal year 2016-2017, Hudson Park generated over $2 million in city/school taxes and over $300,000 in county taxes.
When manufacturing sectors were created, they included several transportation options so products could be easily sent to their destinations. Today, communities are looking for ways to redevelop these former industrial sites to meet current needs. This could include other types of manufacturing, housing, retail and public amenities. Because these areas were built around transportation, strengthening infrastructure – like they did in Yonkers – would entice the private sector to support revitalization efforts.
Building Hudson Park was a long process, but successful in large part because of the transportation improvements made for the city’s residents. In turn, we saw a multiplier effect of greater public spaces, amenities and economic activity. By implementing similar policies in other parts of New York, even more former industrial areas can be turned into economic and socially vibrant communities.
Arthur Collins is the co-founding principal and president of Collins Enterprises LLC, which developed Hudson Park. He can be reached at 203-358-0004.
At 120 Broadway, he is meticulously marrying the old world feel of a 1915 property with the needs of 21st century tenants; farther uptown, he’s planning the redevelopment of the soon-to-be-former ABC campus on the Upper West Side; and the firm recently threw its hat into the construction lending ring with the launch of Silverstein Capital Partners.
On a particularly rainy day in New York City, Commercial Observer caught up with Silverstein over hot chocolate and freshly-baked cookies (the best this reporter has ever tasted) at his office at 7 World Trade Center.
Commercial Observer: You’re in the middle of restoring 120 Broadway and recreating the former Bankers Club restaurant on the 40th floor. What was so special about it?
Larry Silverstein: It was an exquisite eating facility that was established in the building by the Equitable Life Assurance Society. By the time we bought the building in 1980 the club was closed, but I remember eating there and it was simply spectacularly beautiful—opulent. It was old world and had a unique charm, the food was excellent, the waiters were dressed just so.
Did they have a signature dish?
So many. [Laughs.] But ultimately the world changed, business changed and the pace of life changed. The club was closed in 1978 before we bought the building.
Which elements of the past are you recreating at the building?
What we’re doing today is bringing back a segment of the Wall Street dining experience. On the 40th floor we’re building a special facility for tenants to enjoy a light lunch or a refreshment during the course of the day. In the lobby we’re also creating an exact replica of what the building looked like when it was first built in 1915. We’re restoring the building to its original magnificence and making it shine all over again. It’s a historic landmark, it’s unique and special and it’s totally different from the buildings of steel and glass that we’re building at the Trade Center. I think more and more people are expecting to have a different experience over the course of their work day, and if we can provide that for them then all the better. And why not?
You recently received Urban Land Institute New York’s Visionary Leadership in Land Use award. What does this mean to you, in the context of your work at the World Trade Center?
Is it visionary? I suppose so. Is it an achievement? Sure, I suppose so. Where the hell the time has gone? I don’t quite know. But we’ve spent 17 years since 9/11 rebuilding the Trade Center. I acquired the Twin Towers six weeks before 9/11, and so the circumstance was obliterating from the standpoint of eliminating the buildings we had acquired for $3.2 billion. It changed my life and the direction of my life, because the next 17 years required a hugely intensive focus on anything and everything to do with respect to rebuilding the Trade Center.
Where did you begin?
One of the first things we had to do was to try to recover the multiple billions of dollars that would be needed to rebuild as it turned out that we had to litigate with 22 insurance companies. That ultimately produced court verdicts in our favor and enabled us to collect $4.5 billion, although that turned out to be totally inadequate in terms of rebuilding—but that’s besides the point. The last building to come down on 9/11 was 7 World Trade Center, and that was the first one to go back up. We finished this building in 2006; 1.7 million square feet, designed by David Childs of Skidmore, Owings & Merrill. He did such a superb job for us that I asked him to also design Tower 1 as well—at that time it was called The Freedom Tower of course. We subsequently did Tower 4 with [architect] Fumihiko Maki. Shortly thereafter Tower 1 was completed in 2014 and then we finished Tower 3 [at 175 Greenwich Street] just a few months ago and it’s 2.5 million square feet. So now, we’re deeply involved in negotiations for Tower 2 [at 200 Greenwich Street], which will be 2.8 million square feet. End of day, it’s been a labor of love, a major personal commitment to rebuild it and it’s been a fascinating study in human nature.
What did this experience teach you about human nature?
It taught me a lot through dealing with different public officials. Over the course of the past 17 years, we’ve dealt with five or six governors of the State of New York, and easily the same number for the State of New Jersey because the Port Authority [of New York & New Jersey] covers both. I’ve dealt with three mayors but primarily with Mayor [Michael] Bloomberg who was just terrific—absolutely fantastic. Plus a whole series of Port Authority executives.
Every time a public official would enter office they would always say, “Stop [building]. I want to see what is going on, I want to be sure [before we proceed].” But the one thing I came to recognize is that you can’t have these 50-,60-,70- and 80-story buildings going up and then stop in the middle because a public official says, “I want to see what’s going on.” It just doesn’t work that way.
Each elected official had his or her own agenda and sometimes those agendas were laudable because they were concerned about the public good. Sometimes the agendas were not laudable. So it was very interesting to see the attitudes of different elected officials and the ebb and flow.
Before you started rebuilding did you have any time to just take a breath and pause? Or was it straight back to business?
It was straight back to business, and it didn’t stop. It’s still going [laughs]. I think it was about 2012 or 2013 that the pressure began to abate because by that time Tower 1 was well underway and Tower 4 was nearing completion. As soon as we knew we were about to finish Tower 4 we started on Tower 3. The memorial was open and they began construction on the Oculus. So things really began to come together. We saw a light at the end of the tunnel, which I was praying wasn’t a train moving towards me [laughs]. Here we are in 2018 with one tower left to go.
It has been totally realized. We just have to finish Tower 2. And once that’s done then I’ll say, “Ok, I quit. I’m gonna find something else to do with my time.”
What will you do?
Well, I don’t know, because that will be 2022 and in 2022 I’ll be 91 years of age. But I’ll find something else.
What can the rebuilding teach future generations?
I would hope they will applaud the quality of what we’ve produced and the quality of the architecture. I think it’s timeless and the architectural language used in each building varies because each is designed by a different architect—the exception being Towers 7 and 1. Secondly, it’s been a public private partnership; the public aspect is that we’re building buildings that are owned by the Port Authority of New York & New Jersey, and I represent the private interest that literally owned the land. So it’s a public-private partnership [PPP] in the truest sense of the word. It has also produced a whole series of issues that you only get when you have a PPP.
Among the benefits is the fact that the experience is significant in size. We’re talking about what started out as a 15-acre site and ultimately became an 18-acre site. We had 10 million square feet of office space on this site. We’re also ending up with a magnificent memorial, which is appropriate considering that we lost almost 3,000 people that day.
There’s a negative aspect to PPPs because one of the realities is that public agencies like the Port Authority—they don’t deal with monetary issues the way that we do. They have the advantage of airport revenues, bus terminal revenues, tunnel revenues and so forth so they have continued sources of income that come in, but issues like time, value and money aren’t focused on to the same degree as they are when it’s your money. We watch every dime like a hawk; we watch every day of construction very closely. Because timelines are essential; schedules are absolute. Government never thinks that way.
Was that the biggest challenge while rebuilding?
Probably the biggest, yes. But it’s been a fascination. The fact that we’ve gotten to where we’ve gotten I think is pretty magnificent.
What’s your favorite aspect of the rebuilt World Trade Center?
If there’s anything that shows the resiliency, the determination and the fearlessness of New Yorkers, it’s the rebuilding of what has taken place here and what it represents in terms of attitude. The fact that we would not cower in light of what happened on that fateful day. The act that we came back and said, “Let’s go,” and we did, with tremendous determination. It’s a reflection of Americans in general and New Yorkers in particular. I hope that when all is said and done and we’re finished in 2022 that the world will look at us and say, “You did a pretty damn good job.”
Do you think your affiliation with Downtown during this time also encouraged you to move down here from the Upper East Side?
It’s an interesting thing. My wife said: “You know, you have so much invested in the Trade Center, you need to diversify.” So I came home a couple of weeks later and I said, “Honey, I just diversified.” She said “What did you do?” I said, “I bought another piece of land. Over there.” [Points out of the window towards the Four Seasons Hotel at 27 Barclay Street]. She said, “That’s not diversification.” I said, “It is, it’s a whole block north of the Trade Center!” We built the Four Seasons Hotel on the site and the Four Seasons luxury condos above it. We decided to move to one of those luxury condos at the top and the view is fantastic.
Does your wife like it?
She loves it.
Phew. I understand that you’re a fan of street art and that some of it is finding its way into World Trade Center. How did that come about?
When we finished the original 7 World Trade Center, I realized that I had put too much of the same marble in the lobby of the building and it looked like a mausoleum. I remember saying to myself , “How could I do such a dumb thing?” I called my wife and said, “Sweetheart, come down here and take a look with me.” She came down and said: “Larry, it’s a mausoleum. Maybe you should try finding some contemporary art to change it.” So we starting looking. We found a piece by [abstract expressionist] Al Held, a major artist of that time [the late 1980s], a very graphic and hard-edged piece with lots of color and activity. Then we went out to find another, a piece by Lichtenstein. We proceeded to buy different pieces of art and developed a terrific collection in that lobby. Of course all that was destroyed on 9/11. The good thing is that we weren’t destroyed, but the art was gone.
I was admiring the Ran Ortner oil painting of the ocean in the lobby.
Oh, I love that one; his work is spectacular.
You also allowed artists to paint a floor in Tower 4, too?
We had an empty floor and we let a group of artists go up there and told them: “Paint to your heart’s delight.” And we let them paint the floors, the ceilings, the windows. One day the CEO of Spotify came in and we took him up to that floor and he fell in love with it. He ended up leasing 400,000 square feet of space there. Now we’re thinking about what we’ll do in Towers 3 and 2. We have street art on the containment wall around Tower 2, we gave the artists the opportunity to have exposure there, which is enormously important.
Switching gears to the Upper West Side, can you talk us through Silverstein’s $1.2 billion acquisition of the ABC Campus?
ABC decided to sell its campus and to move to new facilities; they outgrew what they had up there and needed something new and modern. When they decided to sell it I looked at that real estate and literally fell in love with it; I knew it was a magnificent piece of real estate that was worth buying for future development. They will stay in possession of the main campus—at 66th to 67th Streets on Columbus Avenue—for five years. At the end of those five years they will vacate and we can demolish the real estate and build a residential property. They have additional buildings that we’re also getting on West End Avenue at 65th to 67th Streets. The West End Avenue properties are different from the campus, and that real estate they will probably stay in possession of for three years. There we will develop in 2020 to 2021 and by 2024 we’ll have the residential buildings complete. The redevelopment of the main campus will take longer. We’re thinking multiple towers. But you’ll have to stay tuned to see what it looks like.
Why was Deutsche Bank a good fit for the loan?
We’ve worked with them in the past and when the opportunity came up their acquisition loan made it possible. It was not a difficult thing to accomplish, it all happened pretty quickly in fact.
You recently launched Silverstein Capital Partners. Why is now the right time to get into construction lending?
We came to the realization that we’ve built some very big structures over the past several years—large hotels, residential towers, major office properties and some of them were very complex buildings. We have the knowledge, the ability, the talent and we have the capacity to do all these things, so it became kind of obvious to join forces with two world-class institutional funds who said, “let’s provide this source of capital for construction loans because it’s an area you know very well.” So, we’re doing it.
When you’re assessing a project to lend against, what’s key for you?
Sponsorship is hugely important. Location is also very important, as is quality of design, as is price point. You have to put all these things together and use good judgment and common sense because it is construction financing and there is risk involved. You have to be dealing with competent people of good name and good reputation and those who have good track records. Construction loans for quality residential buildings make a great deal of sense for us, so that’s the stuff we’re focused on. And there’s lots of product to look at.
Any year-end goals?
Oh my goodness, we just want to have continued good health and keep moving forward, it’s all been so exciting so far and continues to be.
Urban Land Institute New York announced Larry A. Silverstein, chairman of Silverstein Properties, will be the first recipient of the organization’s Visionary Leadership in Land Use Award.
It will be presented to Silverstein on April 4, 2019 during ULI NY’s 4th Annual Awards for Excellence in Development Gala.
The award recognizes a leader within New York’s real estate community whose body of work exemplifies the mission and values of ULI, and who has had a transformational impact on our region and the industry.
Individuals must also have demonstrated an enduring commitment — through civic engagement — to industry associations, causes and initiatives.
“Larry Silverstein exemplifies the values this award represents, and I am thrilled we are able to honor him as the first recipient,” said Steven Kohn, Chairman of ULI NY. “From his perseverance in rebuilding the World Trade Center site and helping spearhead the revitalization of Lower Manhattan, to pioneering sustainability in commercial office buildings, to developing state of the art residential buildings on West 42nd Street, Larry’s commitment to responsible development is a model for the twenty-first century developer.”“This honor is in large part a result of my efforts rebuilding the World Trade Center,” said Silverstein “It has certainly been the passion of my life. But it has been a collective effort involving thousands of people.
“Many members of the Urban Land Institute, and others in our industry, put their hearts and souls into the rebuilding effort. We have all been driven – not by ego or personal agendas – but by our unshakeable love for New York and by the need to respond in a way that would make everyone proud.”
At a ULI panel discussion on design and housing, the former New York politician who’s now leading his family’s real estate business says NY is not generating nearly enough housing.
By: Betsy Kim, Globe St., September 28, 2018
NEW YORK CITY—Putting back on his government hat, Eliot Spitzer said he’s not so sure the 421-a program works. Calling the housing policies of the city and state misguided, the former New York governor said, “We are woefully under-housed. We are not generating nearly enough additional housing.”
“The dollars spent per unit of affordable housing we are getting are way too high,” he continued. “The reason for that is the laws were crafted by people who are beneficiaries—developers and builders and not the public at large. We need to step back and say where we get a better bang for our buck and the answer in one word is transportation.”
If you want to build a city, you build transportation, according to Spitzer. This provides access to the central business district, and results in enormous growth of public and private capital. He added that building transportation would increase housing in “multiples of the numbers we are getting right now through programs that concentrate excess dollars per square foot on a limited number of projects. That’s simple numbers and arithmetic.”
He also commented that the creation of parks generate flow of capital back into the city. The family’s real estate business which he now heads, Spitzer Enterprises, recently opened 420 Kent Ave. for leasing. The three 24-story glass towers house 857 units, of which 65 were available through the affordable housing lottery. The development borders the Esplanade park on the East River waterfront in Williamsburg.
Spitzer was one of the speakers at ULI’s panel on high-design, mixed-income and new urban housing in Greater New York.
Eran Chen, founding principal of ODA Architecture, which designed 420 Kent Ave. was also on the panel. The traditional idea of separating affordable housing in a different location “brought many social problems,” said Chen. But people are getting used to commingling. “Actually, it’s a brilliant idea to bring people who cannot afford these developments into it and to create a community,” he added.
Gary Handel is the managing partner at Handel Architects, one of the firms working on the Essex Crossing development. The 1.9 million square-foot development will offer 1,079 residences, of which 579 are affordable housing. He agreed with Chen’s opinion and stated, “The goal of the entire project is to make the buildings with the lower income components indistinguishable from the market-rate components.”
Handel explained why Essex Crossing is one of the most hotly disputed and controversial pieces of land in the city. In 1958, Robert Moses with the “slum clearance committee” demolished 14 blocks in the Lower East Side. This action resulted in the displacement of more than 7,000 people, many of whom were immigrants according to Handel. He sees Essex Crossing as “community reparations for an event that happened 50 years ago.”
Panelist Colleen Wenke, SVP at Taconic Investment Partners, one of Essex Crossing’s developers, stressed community feedback was essential for the success of the project. She noted the project allowed for flexibility. For example, after community conversations, the developers increased the number of affordable units in one of the rental buildings. They were able to do this by increasing the market-rate units in a separate building.
“It’s toggling and understanding what can work and based on the programs at hand and a long-term perspective of what you are delivering to the community,” says Wenke. “And that conversation will continue to evolve.”
Aaron Koffman, principal of the real estate firm Hudson Companies, Inc., and Claire Weisz, the founding partner of the architecture and design firm, WXY are both working on creating the Peninsula, after demolishing the Spofford Juvenile Detention Center. The 740-unit development in the Bronx will be 100% affordable. He described the growing complexities of working with federal, state and local programs with a massive development.
The days of off-the-shelf programs where there were no gaps, the programs just worked and everybody just showed up for the groundbreaking—those days are over. So far, the Peninsula will require 13 sources of capital.
Weisz noted that even with the complexities and challenges of affordable housing, it’s important to treat buildings as if they are being constructed to last into the future.
The Urban Land Institute New York (ULI NY) has launched the submission process for the 2019 ULI New York Awards for Excellence in Development.
New for 2019, an award for industrial development will be open to projects where 75 percent of the development’s rentable square footage is being used for purposes such as manufacturing, recycling, processing and distribution.
As in prior years, nominations are also open for housing (both market-rate and affordable), office, mixed-use, institutional, civic development, repositioning or redevelopment, hotel, and retail.
“The excitement for our Awards for Excellence competition continues to grow and I eagerly look forward to what this year’s nominations will bring,” said Steven Kohn, Chairman of ULI New York. “It is important for an organization of ULI’s caliber to acknowledge some of the impressive projects that are contributing to New York’s growth in a responsible and sustainable manner.”
The Awards for Excellence in Development is a statewide contest that acknowledges real estate leaders whose projects are raising the bar from a planning, design, sustainability, resilience and community impact perspective.
Noble Carpenter, president, Capital Markets & Investor Services, Americas Cushman & Wakefield, and John E. Westerfield, CEO of Mitsui Fudosan America Inc., have been named co-chairs for the 2019 Awards competition and gala.
“The Awards for Excellence recognizes responsible development projects that build resilient communities to support generations to come,” said Carpenter,.
“Our industry continues to innovate and drive economic growth and prosperity in communities large and small across New York State, and I am happy to be a part of ULI New York’s efforts to recognize those who are leading the way.”
“As the prestige of the Awards continues to grow, we are setting new industry standards and I am honored to be part of this exciting process,” added Westerfield.
“The new industrial category will highlight the great projects that are creating economic opportunities across the state and I look forward to seeing the submissions that highlight this progress.”
The Awards Nominating Committee and Awards Jury are comprised of ULI New York members across the spectrum of New York real estate, including owners, developers, investors, architects, urban planners, construction managers and lenders.
The Awards are open to ULI members and non-members across all industry sectors who have worked on private, public, and non-profit projects. Applications may be submitted for projects located anywhere within New York State, except for Westchester County which is part of ULI Westchester/Fairfield. The deadline for submissions is November 2, 2018.
“A vision for Sleepy Hollow: Managing Change & Building for Diversity,” was put together by the nonprofit Urban Land New York Institute and the Urban Land Institute Westchester/Fairfield. The study was commissioned by the village Board of Trustees last year.
The goal, according to the report, is to identify strategies to connect Edge-on-Hudson with the village and encourage investment in the downtown “that celebrates Sleepy Hollow’s diversity and history while welcoming new residents and not pushing out lower income households.”
Village leaders also “want to encourage new retail businesses and multi-family residential housing along Beekman Avenue,” the report says.
Edge-on-Hudson is a mixed-use mega-development on the 70-acre former GM site along the Hudson River. Phase one, being built by Toll Brothers, involves construction of 306 apartments on 15 acres. When the entire project is finished it will include parks and recreation space, stores, offices and a 140-room hotel.
The report was based on extensive study and analysis of Sleepy Hollow by a ULI Technical Assistance Panel, comprised of members assembled specifically for their expertise in the issues facing the village.
Kim Morque, chair of the panel and president of Spinnaker Real Estate Partners, said “Sleepy Hollow’s growing population and location… make it ideally positioned for new development and investment.”
The Sleepy Hollow panel spent two days in the village, studying conditions and demographics and interviewing residents, merchants, officials and other stakeholders.
“I was very excited, just to have the opportunity to work with a group of outside, independent experts about the challenges we’re facing,” Mayor Ken Wray said of the study. “They were really enthusiastic about it, and the report is a great tool for us right now. We’re in the middle of updating our comprehensive plan, and this really reaffirms a lot of what we’ve been looking at.”
Wray said the village hopes to finish up the comprehensive plan overhaul next year and will most likely incorporate some of the ULI suggestions.
The report’s recommendations for the next one- to five years include:
- Creation of a Beekman Avenue merchant association or Business Improvement District.
- Encourage food trucks, cars and pop-up businesses to fill vacant store fronts and spaces.
- Institute a building facade improvement program, improve lighting, repair sidewalks, replant trees.
- Create a shuttle system to connect Edge-on-Hudson, Beekman Avenue and both the Tarrytown and Philipse Manor Metro-North stations. Also establish bike routes that can connect to the railroad stations, and make the village more bike and pedestrian friendly.
- Move the Farmers Market at Patriot’s Parkto a downtown location. That would have to be negotiated with Tarrytown, which shares the market.
- Create a park at Beekman Avenue and Cortlandt Street.
- Reach out to shop owners in the Latino community with detailed explanations and workshops on incentives that can help them grow. Constantly communicate with various civic leaders and stakeholders to let people know what’s going on and to get their feedback and earn their trust.
A frequent, reliable shuttle system and bike routes could help alleviate Beekman Avenue traffic, the report says. Parking problems could also be somewhat addressed by considering the use ofWL Morse Elementary, Sleepy Hollow High School and the Phelps Hospital Northwell Health parking areas during evenings and weekends.
Wray said that Edge-on-Hudson is already required to create a shuttle system to the railroad stations and that “expanding that to Beekman, Cortlandt and other areas of the village would be a simple thing to do.
He said the report’s emphasis on making Sleepy Hollow more walkable and bikeable is in keeping with what village officials want to see.
“It’s the 21st century. People want to live in a community where they can walk or bike, and not be in the car all the time,” the mayor said.
In the long-term, the report says, Sleepy Hollow should consider zoning changes to allow greater density and encourage developments that meet the needs of people with various income levels. Other suggestions include looking for ways to streamline the approval process for both residential and commercial development. The village should also be considering incentives to bring in new businesses and residential developers.
Sleepy Hollow landlord Billy Procida, who owns eight apartment buildings in the Cortlandt Street neighborhood, welcomed the long-range recommendations.
“ULI is one of the most respected planning organizations in the country,” he said. “I hope the village takes their advice. The way things are right now, Sleepy Hollow is a difficult place for small businesses.”
Procida, president of Procida Funding & Advisors, said there is “selective enforcement” of zoning and building regulations and would-be entrepreneurs “get buried in red tape that makes things confusing and makes the process too long and expensive.”
He said the village should create a task force to “help attract small business however they can. Instead of chasing business away with red tape, let’s make it easy for them.”
Wray said the village will try to address those issues through its comprehensive plan update.
The vision for the village, the report concludes, “should encompass accepting new residents and businesses, including retail, restaurant and hospitality, and offering a wide range of housing options. The legend of Sleepy Hollow may be old, but its most exciting days may be just beginning.”
ULI also reports that Brian Collins, head of development, Fisher Brothers, is the organization’s new vice chairman. Both Kohn and Collins took on their new roles at ULI New York effective July 1.
Kohn, vice chairman and president of Cushman & Wakefield Equity, Debt & Structured Finance, took over the post recently from chairman, CEO of Silverstein Properties Marty Burger, who held the position since 2016.
ULI New York also reports that Brian Collins, head of development, Fisher Brothers, is the organization’s new vice chairman. Both Kohn and Collins took on their new roles at ULI New York effective July 1.
“I am excited and deeply humbled to serve as ULI NY’s new chairman, and I am looking forward to bringing real estate professionals from every discipline across the state together to continue advancing ULI’s mission and values,” Kohn says. “Marty Burger has brought ULI NY to the forefront of many critical issues in the industry and I would like to thank him for his dedication to the real estate community. I am honored to work with Marty, Brian, and the rest of our leadership team to continue ULI NY’s impressive growth.”
Some of the goals Kohn has as the institute’s new chairman include expanding ULI NY’s influence and impact as a thought leader and go-to resource for New York’s real estate industry.; increasing the profile of its annual awards for excellence in development; expanding its community impact programs—TAPs and Tri-State Land Use Council and increasing the number of schools participating in its UrbanPlan program that teaches students about the roles, issues, trade-offs, and economics involved in creating the “built environment.”
Kohn is a trustee and governor of ULI and former chair of the Urban Development and Mixed-Use Council (Red Flight). He is also a member of the Association of Foreign Investors in Real Estate, for which he serves on its board of directors, and previously served on its executive committee. He is a member of the Wharton Real Estate Center Advisory Board and the Pension Real Estate Association.
In addition, Kohn serves as president of the Board of Directors of The Catalog for Giving, and as a member of the Board of Trustees for Bucknell University.
Collins has a 30-year real estate career that includes extensive development experience. Prior to joining Fisher Brothers, Collins was hired by Fortress Investment Group as president of Intrawest, one of the largest resort owner/operators and real estate development companies in North America. Previously, Collins was founder of Colgate Development, a development company that specialized in the luxury hotel and condominium development. He also was a principal and COO of Millennium Partners, one of the premier developers of mixed-use projects.
He is an active member of the Urban Land Institute and was on the board of directors of The Sports Club Co. from 1997 to 2003. He is also active in numerous New York real estate groups and councils.
During Burger’s tenure as chairman, ULI New York added the first two university partners-Fordham and NYU Wagner to its UrbanPlan program, launched a new real estate tech and innovation council, and completed three technical assistance panels, including the release of two comprehensive TAP reports—“Waterfront Edge Design Guidelines,” and “A Vision for a Greener, Healthier, Cooler Gowanus: Strategies to Mitigate Urban Heat Island Effect.”
ULI events in the past two years under Burger’s leadership have also tackled some of the latest real estate trends, including the changing face of retail, the rezoning of Midtown East, and how food can be a catalyst for development.
“The prospect for life sciences has changed in New York. . . . The tide has turned,” said Bill Harvey, managing director for commercial real estate firm Newmark Grubb Knight Frank, speaking during a panel discussion at the New York Genome Center.
“New York is uniquely placed for health technology companies,” said Kate Merton, head of Johnson & Johnson Innovation and JLABS in New York, which recently opened a 30,000-square-foot (2,800 sq m) facility in lower Manhattan between TriBeCa and SoHo.
Foundations in Research
For years, New York City has had several ingredients life-science companies need to get started. Firms often begin with ideas explored at academic medical centers, and New York City has nine such institutions. Top universities like Columbia University and New York University also support innovation. New York City is behind only Boston among U.S. cities in the volume of grants received by the National Institutes of Health (NIH).
However, until recently ideas first developed with help from NIH funding in New York City were often developed into new companies elsewhere. That’s changing. Today, new life science companies based in New York City apply for and win their first rounds of venture capital funding at a rate of roughly $300 million a year, according to the experts on the panel.
Developers like JLABS are creating properties where these new life science companies can open for business. JLABS is a life-science technology incubator that offers a mix of new offices and “wet laboratories” for scientific experimentation. Two other life-science incubators are opening in New York City—the State University of New York (SUNY) Downstate incubator in Brooklyn and Alexandria LaunchLabs in Manhattan. Together, the three incubators will have a total of 100,000 square feet (9,300 sq m) of space.
“For a long time there was not a possible path for where entrepreneurs could go after the academic medical center,” said panel moderator Doug Thiede, senior vice president of life sciences and health care for the New York City Economic Development Corp. “There are now more possibilities than ever for entrepreneurs to grow in NYC.”
The young companies that come to JLABS typically plan to stay for 24 months or less. After that they either apply for more time or move on.
The Need for “Step-Out Space”
New York City lacks the kind of spaces that a life-science company needs when it is too big for a small space in a technology incubator like JLABS. “There is an appetite for this space that is ready to go,” said Robert Albro, managing director of King Street Properties, based in Boston and specializing in science real estate.
Young life-sciences companies need “step-out spaces’ with shorter lease terms that can offer them the freedom to grow. Such a company may have anywhere from 40 to 150 employees; the number can change rapidly and unpredictably as the firm develops its technology.
“Five years out, we had no idea how much space we would need,” said Sam Globus, vice president of business strategy and operations for Celmatix, a New York City–based company that uses big data analytics and genomics to improve fertility treatments. Most conventional property owners offered leases of office space starting at about ten years, he noted. “There was no way our investors would let us make a ten-year commitment,” he said.
Life-science companies also need a certain kind of real estate to thrive. The buildings should not be too tall: laboratory spaces need ventilation that would be inefficient in a high-rise. The floor plates should also be relatively large: 30,000 to 50,000 square feet (2,800 to 4,600 sq m) of space per floor is a good amount. “With 20,000 square feet [1,900 sq m], you are spending a lot for staircases,” Globus said.
In addition, like any other employer, life-science firms want to locate in buildings and neighborhoods that will help them attract the best employees.
Evaluated according to those requirements, many existing buildings in New York City are too tall, are too small, or suffer from some other problem like a lack of windows. Other, less expensive, less densely developed cities, however, have found places to build suitable properties. “You can’t swing a cat around San Diego without hitting some kind of appropriate step-out space,” Merton said.
New York City has committed $500 million toward overcoming these obstacles to create a cluster of new life-science spaces, including $100 million to help unlock space for companies to grow. So far, city officials have identified five potential locations for a cluster of life-science developments, though no announcement had been made by early June.
New York City’s Advantages
Despite the challenge of finding or creating the right kind of space, life-science companies benefit from being in a great location like New York City, which helps attract investors and talented employees.
These companies may also benefit from being close to potential partners for outsourcing some operations. Life science properties often build out 60 percent of their space for labs, leaving the remainder for office space. But life science firms in New York may need less lab space – as little a 40 percent of the total space – because these companies may can find nearby partners to outsource a significant amount of their lab work.
Celmatix’s first offices in a WeWork building in New York had no lab space at all. Instead the company partnered with outside labs. “I would not be sitting out here today if we had not outsourced a lot of our wet lab space,” said Globus. The solution gave Celmatix flexibility to grow, though eventually the firm moved to larger offices that provided it with some lab space of its own.
Life-science companies also benefit from being close to the many technology companies that have offices in the city. Partnerships with these firms can help life-science companies handle their technology and cut down on the need to own and maintain infrastructure like computer servers.
New York City has also created several programs that can help individual companies offset some of the cost of building out laboratory space, including by providing low-interest loans or perhaps even an equity investment. “Life-science companies want to spend their money on science and not on the real estate,” Thiede said.
These laboratory spaces may be less difficult to fit into a building alongside conventional office tenants than it might seem at first. Many landlords who hesitate to provide lab space are already comfortable with doctors’ offices that regularly use hazardous materials like the radioactive isotopes in X-ray machines. “There is nothing in our labs that you can’t drink,” said Globus.
Once the laboratory space at the life-science property is built for one tenant, the same space can often be used by future tenants without a lot of expensive upgrades. “If built-out correctly, people don’t appreciate how reusable lab space is,” said Albro. At his properties, the same laboratory space on occasion has been reused by four or five successive tenants without requiring much work to fit out the space.
By: REW Staff, Real Estate Weekly, April 19, 2018
Urban Land Institute New York (ULI NY) announced the winners of the 2018 New York Awards for Excellence in Development.
The statewide awards were open to ULI members and non-members who have worked on private, public, and non-profit projects in one of the eight categories.
“This year’s finalists embody the core mission of the Urban Land Institute – to provide leadership in the responsible use of land and in creating and sustaining thriving communities,” said Marty Burger, chairman of ULI New York.
“We congratulate all of the winners who have truly demonstrated a strong commitment to building vibrant and sustainable communities for New Yorkers to enjoy for generations to come.”
A jury reviewed 19 finalists and conducted site tours to determine how well each exemplified the principles of ULI and the Awards criteria.
“Each of tonight’s winners exemplifies a new era in the real estate industry towards creating more responsible and inclusive development,” said John Gunther-Mohr, co-chair of the Awards and Senior Vice President, Santander Bank.
Washington Square Partners was the winner in Retail Development for City Point. Paul Travis, Founder and Managing Partne, said,
“The City Point project has brought a diverse set of high-quality options in retail, food and entertainment to a market previously underserved by these lifestyle resources.”
The Scott Bieler Clinical Sciences Center won for Institutional Development. “When we set out to design this project, we had three critical goals in mind,” said John Schuyler, Partner at FXCollaborative.
“We wanted to reflect the best qualities of our client Roswell Park; to craft a meaningful design that engages the larger Buffalo community; and, most importantly, to create an uplifting environment for those going through challenging health related issues.”
Jed Walentas, Two Trees Management Principal, accepted the award in Market-Rate Housing Development for 300 Ashland. “Designed by renowned architect Enrique Norten with significant input from the city over a number of years, 300 Ashland is anchored by a sweeping public plaza, Apple, 365 by Whole Foods and will soon offer an array of cultural programs from BAM Cinemas, MoCADA, Brooklyn Public Library and 651 Arts,” said Walentas.
Joanne Oplustil, President and CEO of CAMBA Inc., accepted the award in Affordable Housing Development for CAMBA Gardens.
Washington Square Park, by BKSK Architects won best Civic Space and Tata Innovation Center by Forest City New York won in Office Development.
Modernizing a 19th century coffee warehouse in to the new Empire Stores waterfront oasis with retail, dining, public space, and exhibition development won Michael Cayre, Principal of Midtown Equities, the award for Repositioning / Redevelopment and the World Wide Group was the winner in Mixed-Use Development for 250/252 East 57th Street Redevelopment.
Arash Azarbarzin, President of SH Group, collected the Hotel Development award for 1 Hotel Brooklyn Bridge & Pierhouse at Brooklyn Bridge Park.
By: Kelly Mena, Kings County Politics, April 11, 2018
The Urban Land Institute New York (ULI NY) 3rd Annual Excellence in Development Awards was held in Manhattan’s Gotham Hall last night, but it was Brooklyn developments that took the lion’s share of awards.
The event drew hundreds of attendees from across the real estate spectrum to celebrate New York–based developers, architects, urban planners and other land use industry professionals whose work reflect an exemplary commitment to responsible planning, design, sustainability and community impact.
This year ULI NY Honored 9 Outstanding Development Projects in the Categories of Housing, Office, Mixed-Use, Institutional, Civic Space, Repositioning or Redevelopment, Hotel, and Retail.
Some of this year’s winners from Brooklyn included Dumbo-based Two Trees Development, which nabbed the Excellence in Market-Rate Housing Development award for their breathtaking 300 Ashland building, which is already being regarded as iconic as part of the BAM Cultural District.
Acadia Realty Trust and Washington Square Partners, which took the Excellence in Retail Development Award for their City Point project, 10 City Point just off the Fulton Mall and Flatbush. The development features among other retailers, a Target, a Century 21, a Trader Joe’s and the most happening food court in Brooklyn.
“We are honored to be recognized for playing a leading role in the reimagining of retail in Downtown Brooklyn. The City Point project has brought a diverse set of high-quality options in retail, food and entertainment to a market previously underserved by these lifestyle resources,” said Paul Travis, Founder and Managing Partner of Washington Square Partners.
Other Brooklyn winners included the non-profit CAMBA, which was a first time winner this year in the Excellence in Affordable Housing Development category for CAMBA Gardens, their innovative design of an affordable housing complex on the campus of the Kings County Hospital, located on the border of Crown Heights and East Flatbush.
The buildings were constructed by the city’s Supportive Housing Loan Program in conjunction with CAMBA, which provides employment, education, health, legal, social, business development, and youth services to New Yorkers.
“It was an incredible experience to work on a transformative project that offers a safe and secure environment for everyday New Yorkers. For a non-for profit to win such a prestigious award for all the work that we’ve done is wonderful. What we have done is wonderful. We are absolutely thrilled to be included with such an array of phenomenal for-profit developers,” said Joanne Oplustil, President and CEO of CAMBA Inc.
Midtown Equities, HK Organization, and Rockwood Capital nabbed the Excellence in Repositioning or Redevelopment Award with DUMBO’s Empire Stores at Brooklyn Bridge Park.
Toll Brothers and Starwood Capital Group received the Excellence in Hotel Development Award for their 1 Hotel Brooklyn Bridge, also at DUMBO’s Brooklyn Bridge Park.
“We cultivated the best of eco-conscious design and sustainable architecture that seamlessly extends to the breathtaking Brooklyn Bridge Park to allow for residents and pedestrians to access the park. With this property, we were able to select every material and develop mindfully, keeping in mind the space’s main purpose to serve, entertain and inspire with some of the best amenities found in the New York hospitality market,” said Arash Azarbarzin, President of SH Group, which shared the award for 1 Hotel Brooklyn Bridge & Pierhouse at Brooklyn Bridge Park.
Besides the dinner awards ceremony there was ample time for the several hundred development executives to mingle, talk shop and network in a relaxed, but semi-formal environment.
“We congratulate all of the winners who have truly demonstrated a strong commitment to building vibrant and sustainable communities for New Yorkers to enjoy for generations to come,” said Marty Burger, Chairman of ULI New York.
OP-ED By: James Lima, Kings County Politics, February 9, 2018
As part of the de Blasio administration’s long-term housing plan, Gowanus is expected to soon undergo a rezoning that would bring significantly more affordable housing to the neighborhood. This is good news for local residents – but it should also be seen as an opportunity to make Gowanus a national model for creating more equitable and sustainable communities.
A new report released by the Urban Land Institute New York, the Fifth Avenue Committee and other stakeholders provides important recommendations for taking this opportunity to improve the health and quality of life of Gowanus residents as part of any future rezoning. By focusing on addressing existing public health challenges alongside the need for more affordable housing, city officials and developers can advance a truly holistic approach to new development.
First, it is crucial to understand the public health challenges currently facing Gowanus and how they affect local residents. The neighborhood is centered around the Gowanus Canal, a storied but heavily contaminated piece of 19th century industrial infrastructure. The Canal was designated a federal Superfund site in 2010 and clean-up efforts are anticipated to begin this month, with some remediation already underway. However, it is important to understand that the area is impacted not only by the Canal’s toxicity, but also by the Urban Heat Island (UHI) effect, a phenomenon that creates higher temperatures in urban areas than in surrounding areas.
UHI typically occurs in densely developed areas where little or no natural vegetation exists to counterbalance the effects of heat-absorbing structures, concrete- and asphalt-paved surfaces and an abundance of car traffic. These conditions are likely to worsen; according to a 2015 report prepared by the NYC Panel on Climate Change, the mean annual temperature in the city is estimated to increase up to 5.7 degrees by 2050.
UHI drives up energy costs, increases air pollution and greenhouse gas emissions and undermines the well-being of residents. Children, the elderly and low-income families without air conditioning are particularly susceptible. Extreme heat events cause more deaths in the United States than all other weather-related events combined.
City officials and developers can address these issues in Gowanus by following the recommendations of “A Vision for a Greener, Healthier, Cooler Gowanus: Strategies to Mitigate Urban Heat Island Effect,” which came out of a partnership between ULI New York, the Fifth Avenue Committee and a 10-member Technical Assistance Panel (TAP) comprised of environmental, real estate, and transportation experts. This diverse team visited Gowanus and analyzed existing conditions to address UHI in the context of a potential rezoning.
The report found that the city can simultaneously attract new families, incentivize small business owners and tackle environmental challenges by employing strategies such as increasing vegetative coverage, boosting transit utilization and maximizing energy efficiency in new and existing buildings.
For example, the report proposes an overall target of 20 percent vegetative coverage in Gowanus, estimating that this additional green space could help reduce neighborhood temperatures by 3 degrees Fahrenheit. Other recommendations include adding vines to the exterior walls of buildings, adding street trees, and redirecting and reusing the solar heat that is already captured in buildings. The panel also explored how green spaces could maximize opportunities for Urban Heat Island mitigation by following the paths of prevailing winds and historic creeks within Gowanus, as well as designing “areas of respite” where residents could pause their journeys in a cooler environment.
The TAP further explored replicable mechanisms which could help finance district-scale improvements, including establishing a Green Infrastructure Fund that utilizes a combination of public monies generated through the purchases of air rights and additional zoning bonuses tied to community benefit. These recommendations offer a means by which to capture some of the increase in real estate value created directly by the city rezoning.
The city’s rezoning tools, deployed strategically with ongoing public capital investments in infrastructure and contamination clean-up efforts offer an opportunity for the community to achieve meaningful and much-needed environmental, social and economic gains.
James Lima is president of James Lima Planning + Development, a national real estate, economic and public policy advisory firm. He served as chair of the Technical Assistance Panel convened by ULI NY and the Fifth Avenue Committee to analyze existing conditions in Gowanus and propose measures to mitigate the impacts of the UHI effect.
By: Betsy Kim, GlobeSt.com, February 2, 2018
NEW YORK CITY—On the heels of President Trump’s State of the Union address where he unveiled plans to ask Congress to pass a $1.5 trillion infrastructure bill, on Wednesday the Urban Land Institute New York emphatically tied together the critical role of public transportation with the success of real estate projects and the city.
In a panel discussion “Driving Development: The Future of Infrastructure,” at the Times Center in Midtown, the moderator Thomas P. McKnight, EVP and head of planning, development and transportation at the New York City Economic Development Corporation, asked transportation and land use decision-makers direct questions about funding and priorities of the region’s infrastructure—all too often described as “crumbling.”
McKnight asked with limited dollars, whether the agencies should be focused on repairing the existing infrastructure instead of on growth.
“The answer is we have to do both,” said Rick Cotton, executive director, Port Authority of New York and New Jersey. “The shortcomings of the infrastructure are significant and need repair. But the fact is the region has grown. There are different centers of population that are growing, so if you are not finding ways to expand, you’re really not serving the agency’s needs and purpose.”
Janno Lieber, the chief development officer at the Metropolitan Transportation Authority, said repairs versus expansion presents a false dichotomy. Projects such as the $2.5 billion Long Island Railroad mainline are described as mega projects. However, the current system when built was designed for 50,000 commuters. Now it serves three million riders.
Transportation Funding and Financing
Tremendous pools of capital available for infrastructure projects exist in the private sector, according to Edward Pallesen, managing director, infrastructure investment group in the merchant banking division at Goldman Sachs & Co. In a low return environment, institutional investors are looking for long-dated, reliable, stable assets to match against long-dated liabilities.
“People from around the world really want to get into quality infrastructure projects,” said Pallesen. “The good news is if you ask people to pick where they would like to invest, the US would be right at the top of that list and in the US, New York City has no better set of opportunities.”
However, he noted a challenge in the US is finding projects where there are few political risks. Permitting, delays, and political infighting can quickly turn off institutional investors. The private-public partnership for LaGuardia Airport was a strong fit because there were revenue sources that could be identified and isolated. For a sustainable role, risk must be transferred to the private sector, whether it’s traffic demand, upside potential or a construction risk, said Pallesen.
However, he reiterated that the private sector is not well positioned to take on governmental entities fighting over what actions to take.
“Leadership and initiative from public officeholders is really essential. If those are put into place with high certainty, a lot of capital will be available,” said Pallesen.
Growth and New Projects
“The essence of transformational projects is unlocking potential,” said Lieber. The extension of the 7 subway line opened up potential for roughly 50 million square feet of development, more than half of which will be commercial, the rest residential and hotels. He emphasized that the economic benefits would be heading toward $300 million per year of recurring public revenue.
In addition to the public transportation supporting Hudson Yards, Lieber touted the completion of Phase 1 of the Second Avenue subway, and underscored the importance of Phase 2. This latter project will extend the subway from the 96 Street stop up to Lexington and 125th Street. Lieber stressed that it will help connect economically deprived populations in Harlem with jobs and access to the Metro-North railroad system at 125th Street.
The estimated $6 billion project includes three new stations, power substations, signal and communication systems, and car cleaning facilities. Instead of being a blank wall station to catch trains, it will focus on a value capture model to integrate its above-ground presence and streetscape additions within the neighborhood.
The city council has already approved the East Harlem rezoning. However, it is the subject of litigation that warns against untoward effects of gentrification, as the rezoning allows for a special transit land use district with luxury high-rises, along the Q subway when it is extended.
Janno sees the project as taking advantage of real estate opportunities that will help the neighborhood with more economic activity. Opponents fear the influx of luxury housing will drive up prices, making real estate too expensive for long-term, lower income residents.
Maintenance and Repairs—Signal Systems
Lower profile projects that do not gain headlines are nonetheless critical in improving the existing infrastructure. The MTA and PATH are updating signal systems, so throughout the subway system, cars can safely run more closely together, increasing the number of trains operating on the system during peak hours.
“In addition to the systems being old, the technology they are built on is ancient,” said Lieber. “So, thinking about technology to allow more throughput is not just a state of repair project.”
The current signal system was blocked by outdated technology that required a great deal of equipment to maintain communications. The new technologies will reduce the need to do work in the right-of-way. Lieber anticipates the process to lead to an announcement in the next couple of months.
By: Will Parker, The Real Deal, January 31, 2018
On the morning following President Trump’s State of the Union address, RXR Realty chairman Scott Rechler called the president’s $1.5 trillion infrastructure pitch unrealistic.
“It’s not a reality. The trillion-and-a-half dollars isn’t possible,” Rechler said at a panel for the Urban Land Institute New York on Wednesday morning. “The money that we would use for infrastructure was repatriation dollars… has been used for tax reform. Not saying good or bad, but the answer is, there’s no trillion-and-a-half dollars.”
Since the 2016 campaign, Trump has proposed reviving America’s outdated roads, bridges, airports and other infrastructure by leveraging mostly private investment, offering incentives to those willing to take on new projects. Rechler — who advised Trump on the matter during the presidential transition last January and who is a board member of the Metropolitan Transportation Authority — said he is largely supportive of public-private partnerships, but suggested that much of the infrastructure work that needs to be done wouldn’t result in a profit for private firms. He used the potential repair of water systems without a consummate rise in the price of water as an example.
“There’s no revenue stream for the private sector to come in and potentially take advantage of that,” he said. “So I think this concept of we’re going to invest $200 billion dollars and that’s gonna raise a trillion to a trillion-and-half dollars is not realistic.”
Rechler was joined on the panel by TPG Real Estate Finance Trust’s CEO Greta Guggenheim and Jimmy Kuhn, the president of Newmark Knight Frank. The talk was moderated by PwC’s Mitch Roschelle. The participants discussed the outlook of national real estate in 2018 and even swapped some insider gossip about where Amazon’s second headquarters may be likely to land (Rechler’s heard the Washington, D.C., suburbs, but Guggenheim said she’s been hearing Atlanta).
All of the panelists commented that recently enacted federal tax reforms, which will cut effective rates for most real estate investors, was positive for the industry, though some conceded that there may be unintended consequences that will reveal themselves with time. Rising interest rates were also a key topic of the discussion. Guggenheim cited the U.S.’s “interest rate bull market for 30 years” that is now changing, with a still to be determined effect on real estate capital markets.
Rechler previously served on the board of the Port Authority of New York and New Jersey, but left in early 2016, citing frustration with the body’s internal and external political disputes. He is currently the chairman of the Regional Plan Association.
In this season of bomb cyclones and polar vortexes, it is hard to remember how hot this town gets in the summer. Thanks to a phenomenon known as the urban heat island (UHI) effect, cities can be more than 20 degrees warmer than surrounding suburbs and countryside. UHI is deadly: extreme heat causes more deaths in the U.S. than all other weather-related events combined. And the risks are greatest in communities—like Gowanus, Brooklyn—that are impacted by poverty, pollution, and a lack of cooling green space.
Here’s the good news: The proposed rezoning of Gowanus presents an unprecedented opportunity to tackle the UHI effect, saving lives while creating a more equitable and sustainable community.
Gowanus faces daunting public health challenges. The neighborhood is home to more than 15,000 residents, some 4,000 of whom live in public housing where tenants tend to be lower-income and older than the population at large. The Gowanus Canal, designated as a Superfund site in 2010, has been a dumping ground for waste and contamination for decades and two major traffic arteries, the Brooklyn Queens Expressway (BQE) and the Fourth Avenue corridor, on Gowanus’ southern and eastern borders, contribute to poor air quality. Air and water pollution are linked to high rates of asthma and other chronic health problems.
UHI makes all of these problems worse. Because extreme heat can exacerbate chronic medical conditions, the impacts of UHI can be greater for at-risk populations that suffer from higher incidences of heat-related mortality. UHI also leads to higher energy consumption and costs, as well as increases in air pollution and greenhouse gas emissions.
Rezoning could turn up the heat in Gowanus. If higher density buildings are permitted without comprehensive sustainability plans to promote localized cooling, the UHI effect could worsen, further burdening vulnerable residents—many of whom are not able to afford air conditioning to keep cool, and who live in older buildings that have not been renovated to meet current housing code.
But rezoning also presents an opportunity for positive change. With Gowanus expected to see significant land use changes and new public investment as part of Mayor de Blasio’s plans to address the city’s growing population and long-standing affordable housing crisis, there’s no better time than now to focus on environmental justice needs and the health and overall quality of life for residents. The rezoning of Gowanus should include New York City’s first ‘Eco-District’ that directly addresses UHI and advances a number of local and city-wide sustainability and resilience efforts. As the country’s fairest and most progressive big city, New York City should be creating innovative land-use models that advance equity and sustainability to both meet local community needs and advance New York City’s bold affordable housing and climate goals.
To bring attention to the disproportionate negative health and environmental impacts to at risk populations, the Fifth Avenue Committee partnered with the Urban Land Institute New York’s Technical Assistance Panel. Ten real-estate, transit, and environmental experts—advised by public-housing residents and other local leaders—analyzed the existing conditions in Gowanus and proposed a series of measures to mitigate the impacts of UHI. These recommendations are included in a new ULI NY report, A Vision for a Greener, Healthier, Cooler Gowanus: Strategies to Mitigate Urban Heat Island Effect.
Steps include increasing vegetation by 20 percent to reduce air temperatures, support storm water retention, and help mitigate flooding. Vines could be added to the external walls of existing buildings to reduce outside temperatures and cool the buildings themselves. New buildings should use green infrastructure to reduce, rather than contribute to the UHI effect, by installing green roofs and double- or triple-pane windows; creating breezeways to provide ventilation and encourage airflow; and redirecting and reusing solar heat, which, if allowed to be wasted, can contribute to higher temperatures.
Transit systems should be more efficient to encourage people to take public transit rather than drive. This will help reduce congestion and decrease car emissions, which contribute to the UHI effect. There should be more frequent bus service, sufficient bike parking, and stop-sign and traffic-light improvements. And because Gowanus offers few places for pedestrians to escape the heat, the community’s network of hidden creeks should be daylighted, and areas of respite should be created to provide cool and inviting public spaces. In addition, green workforce development opportunities for local residents are essential to any rezoning effort.
While implementing green infrastructure is smart and sensible, it’s of even greater consequence to ensure that the anticipated multi-billion dollar public and private investments in Gowanus contribute to environmental equity goals before any zoning changes are approved.
No community should bear a disproportionate burden of impacts due to environmental, planning, and policy decisions. Today, we have an opportunity to put in place innovative and forward-thinking land use and sustainability standards while also advancing tangible and meaningful social, economic, and climate justice remedies. Let’s not waste this unique moment to make Gowanus a model community that is greener, healthier, cooler, and more equitable.
Michelle de la Uz is the executive director of the Fifth Avenue Committee and oversees its mission of advancing economic and social justice. She is also a member of the New York City Planning Commission. This commentary was produced in collaboration with the Island Press Urban Resilience Project, which is supported by The Kresge Foundation and The JPB Foundation.
By: Betsy Kim, Globest.com, January 16, 2018
NEW YORK CITY—The anticipated rezoning of Gowanus, Brooklyn in furtherance of Mayor Bill de Blasio’s housing plans, Housing New York: A Five-Borough, Ten-Year Plan and Housing New York 2.0, will increase development opportunities in the upcoming years.
The Urban Land Institute New York and the Fifth Avenue Committee, a South Brooklyn community non-profit group, organized a technical assistance panel (TAP) of environmental, real estate and transportation experts to study the Gowanus neighborhood. ULI then issued a report, recommending quality-of-life strategies, contemplating increased densification of buildings.
The report focuses on the Urban Heat Islands phenomenon, which occurs when buildings, asphalt and concrete replace plant life; and cars and air conditioners release additional heat into the environment. This heats up urban areas. The US EPA says in a city of a million people, this can increase the temperature 1.8 to 5.4 degrees hotter than its surroundings neighborhoods.
Urban heat islands can prevent cities from cooling off at night, getting up to 22 degrees hotter than neighboring areas. The CDC reports that each summer more than 65,000 people visit the ER for heat illnesses, and that between 2006 and 2015, heat caused the deaths of 1,130 people.
ULI states 4,000 public housing tenants live in Gowanus. It notes they tend to be lower-income, older, and having higher rates of asthma and other chronic diseases compared with the general population. The US Census Bureau reports 25% to 50% of Gowanus residents live below the poverty level.
Urban heat islands particularly affect the poor and underserved populations, as most do not have air conditioning and are vulnerable to heat-related health problems.
In addition, the report points out that extreme heat increases energy demands, air conditioning use, air pollution, greenhouse gas emissions and water pollution.
“Offsetting the impacts of this UHI phenomenon should be a high priority during any redevelopment plan for Gowanus,” says TAP chairman, James Lima, president of James Lima Planning + Development.
“Gowanus faces a series of complex challenges ranging from UHI effect to Superfund site toxicity, and poor air quality, among other public health concerns. The anticipated rezoning process presents a timely opportunity to coordinate and implement numerous important measures that can help ensure the health and vitality of Gowanus residents for years to come.”
ULI NY Chairman Marty Burger, CEO, Silverstein Properties, commends the ULI NY TAP process for bringing together land use experts who provided advice and solutions on a volunteer basis. Burger also commends the process for including residents to share their concerns and ideas on making neighborhoods more livable.
Michelle de la Uz, executive director of Fifth Avenue Committee, says the process allows residents to voice concerns and make recommendations before any zoning changes are approved. She describes the cooperative efforts as transforming one of New York City’s most toxic and environmentally challenged communities into a example of sustainability and resilience.
The report includes the following key recommendations:
(1) Increase vegetation by 20%, which could reduce air temperatures by approximately three degrees, support stormwaterretention and help mitigate flooding.
(2) Provide incentives for green buildings in new developments. This could include green roofs, double or triple pane windows, breezeways and solar energy use.
(3) Design public areas and paths for pedestrians to escape the heat.
(4) Increase transportation system efficiency.
(5) Turn the Con Edison lot between Baltic and Butler streets into a temporary park, especially with the only neighborhood park, Thomas Greene Park, slated to be temporarily closed for remediation efforts of the Superfund clean-up.
Several green building incentives are already in effect in New York City and New York State including green roof tax abatements available through March 18, 2018, as well as green building programs, such as the Bronx Environmental Revolving Loan fund. This initiative provides zero interest loans of up to $100,000 to install measures that improve air quality.
The report supports encouraging developers, businesses and homeowners to pay for heat mitigation measures and to later get rebates. It describes similar environmental programs across the country.
In Minneapolis, Minnesota, building owners who improve storm water management, including a green roof, receive 50% credit towards storm water fees.
Philadelphia, Pennsylvia provides green roof rebates of 25% of cost up to $100,000.
The Seattle, Washington Rainwise program gives rebates for rain gardens or cisterns if the property is in a sewer overflow area.
Nashville, Tennessee allows $10 in sewer fee reduction for every square foot of green roofing.
Montgomery County, Maryland offers rebates of up to $10,000 to property owners installing approved stormwater management systems.
The report also recommends creating a green infrastructure fund, using both public and private money.
It states Gowanus is likely to experience increased density. Thus, “Rezoning provides an opportunity to leverage the tremendous real estate value created to proactively address UHI risk and incorporate strategies for mitigation.”
By: Pamela Wong, Bklyner, January 9, 2018
GOWANUS – The Urban Land Institute New York (ULI NY) released a report on Monday outlining recommendations on how new developments, that will be built as part of the rezoning of Gowanus, will be able to help mitigate the urban heat island (UHI) effect.
UHI occurs when buildings, cement, and pavement replace natural vegetation, and cars and air conditioners convert energy to heat and release it into the air. ULI NY’s report notes that the extreme heat from UHI increases energy costs, air conditioning use and costs, air pollution, and greenhouse gas emissions. It also affects water quality and can exacerbate chronic health conditions.
Gowanus is more vulnerable to extreme heat because of the area’s heavy traffic and lack of shade trees, parks, and greenery that cool and improve air and water quality, the report states. If higher density buildings start rising in Gowanus, ULI NY says UHI risks could increase unless measures are taken to implement green infrastructure.
Extreme heat events cause more deaths in the United States than any other weather-related hazard, including hurricanes, tornadoes, and flooding, according to the report. Studies show heat-associated deaths primarily affect low-income and environmental justice communities—highly polluted areas with significantly fewer trees and less green space, according to ULI NY.
In April 2017, ULI NY and the Fifth Avenue Committee assembled a ten-person Technical Assistance Panel (TAP)—a group composed of environmental, real estate, and transportation experts who spoke with community stakeholders, analyzed existing conditions in the neighborhood, and compiled a list of strategies to address UHI in Gowanus in anticipation of rezoning projects.
The goal of the report is to make Gowanus safer and healthier, as well as more comfortable and pleasant. The panel’s recommendations aim is to help reduce energy use in the neighborhood which will benefit local homeowners, tenants, business owners, and manufacturers.
The Gowanus UHI TAP team created a series of measures to mitigate the UHI effect, some of which include creating more green spaces and implementing measures that encourage human-powered transportation.
Some of the key items the Gowanus UHI TAP proposed include:
- Increasing vegetation coverage in Gowanus by 20-percent (approximately 1,000,000 square feet) in an effort to reduce air temperatures by approximately 3 degrees. This would also support stormwater retention and help combat flooding. The panel suggests planting trees and adding vines to exterior walls of buildings to help reduce outside temperatures and cool the interiors. They also suggest adding planters at locations where soil contamination or groundwater levels prevent trees from being planted.
- Incentivizing green building and green infrastructure technology, such as green roofs and green walls, as well as promoting efficient building design including double or triple-pane windows, insulation, and breezeways for natural ventilation.
- Creating “areas of respite” where pedestrians can escape the heat during the summer, such as green spaces, green corridors, and “micro parks” featuring cooling green infrastructure, trees, and other structures that provide shade and encourage social activity.
- Improving transportation options and encouraging locals to use public transit and/or human-powered transportation instead of driving to reduce congestion and decrease emissions. The panel suggests more frequent bus service, more bike parking, and stop sign and traffic light improvements at major intersections. The team also suggests the addition of a new pedestrian bridge on Degraw Street over the Gowanus Canal to provide easy foot access across the canal.
- Creating a temporary park at the Con Edison lot located on Nevins between Baltic and Butler Streets while the area’s only public park, Thomas Greene Park, is closed for several years as part of the Superfund clean-up. Like Thomas Greene, the temporary park would feature a pool to help locals stay cool and serve as a community space. The panel also suggests redesigning Thomas Greene Park with additional green space when it reopens.
Founded in 1936, the Urban Land Institute is a non-profit research and education organization that provides leadership in responsible land-use by facilitating the sharing of ideas, information, and experience among industry leaders and policy makers committed to creating better environments.
You can read Urban Land Institute New York’s full report titled A Vision for a Greener,Healthier, Cooler Gowanus: Strategies to Mitigate Urban Heat Island Effect here.
By: NY1 News, January 9, 2018
While a warm up is in the forecast this week, people in one Brooklyn neighborhood are looking for ways to keep cool.
Gowanus, a notorious industrial area suffers from what experts call urban heat island effect or U-H-I.
Because of the high number of concrete buildings and little green space, higher temperatures last for longer periods of time and plague the neighborhood in the warmer months. Experts say U-H-I can worsen the effects of pollution and cause health problems.
Members of the Urban Land Institute and the Fifth Avenue Committee conducted a study to come up with ways to alleviate the problem.
“If you walk down third avenue on a hot summer day, it is hard to find a tree in the entire length of the community and so it is something that resonated for people,” said Michelle de La Uz, Executive Director of the Fifth Avenue Committee.
The groups recommendations include adding new parks, more vegetation and giving developers more incentives to construct green buildings.
Their findings come as the city prepares to rezone the neighborhood which would likely spur more development.
By: Rich Bockmann, The Real Deal, January 8, 2018
A portion of an estimated $600 million in value that could be created by rezoning Gowanus could be captured to help fund infrastructure investments to help mitigate the “urban heat island” effect, according to a new report.
As the city considers rezoning the industrial Brooklyn neighborhood, the Urban Land Institute put out a report that recommends the city take into consideration how new developments could impact heat and temperature in the neighborhood.
Gowanus, unlike neighboring areas such as Park Slope and Carrol Gardens, was developed without the abundant tree coverage and shade that cools neighborhoods. As a result, Gowanus is more vulnerable to heat than its neighbors.
“Offsetting the impacts of this [urban heat island] phenomenon should be a high priority during any redevelopment plan for Gowanus,” said James Lima, president of James Lima Planning + Development, who chaired the ULI panel that produced the study. “The anticipated rezoning process presents a timely opportunity to coordinate and implement numerous important measures that can help ensure the health and vitality of Gowanus residents for years to come.”
ULI put forward several proposals for how to mitigate the heat effect, such as creating a Green Infrastructure Fund – which could be funded through tax assessments or penalties on developers who don’t comply with certain requirements – or providing density bonuses for buildings that include things like green roofs.
By: Mary Frost, Brooklyn Daily Eagle, January 8, 2018
Gowanus is one of the trendiest neighborhoods in Brooklyn, but will its upcoming rezoning make the neighborhood way too hot?
Gowanus — an area already subject to a poor air and water quality, heavy traffic and lack of parks and open space — could suffer the effects of a phenomenon known as the urban heat island effect as higher density buildings are developed, according to the nonprofit Urban Land Institute New York (ULI NY).
In the urban heat island effect, buildings, cement and asphalt paving cause cities to be hotter than surrounding, less developed areas, especially at night. While daytime temperatures can be as much as 5 degrees Fahrenheit hotter, evening temperatures can be as much as 22 degrees hotter than neighboring areas.
According to the Environmental Protection Agency, increased heat from the urban heat island effect has been linked to respiratory difficulties, heat cramps, heat stroke and deaths.
Gowanus is one of several neighborhoods facing rezoning as part of Mayor Bill de Blasio’s affordable housing push.
ULI NY was invited to look into the issue by the nonprofit community development corporation Fifth Avenue Committee. Together, they convened a Technical Assistance Panel in April to study the potential rezoning and offer recommendations to ameliorate drawbacks. ULI NY issued a report on Monday.
Some of the recommendations in ULI NY’s report include more trees and plantings, green roofs and breezeways, “paths of respite” along windy corridors, better public transit, and turning the Con Edison lot between Baltic and Butler streets into a temporary park while the area’s only public park, Thomas Greene Park, is closed as part of an area Superfund cleanup.
Land values in the area north of Third Street are expected to explode following rezoning, according to the panel.
“What if you could capture some of the value of the real estate and use it for public benefit?” James Lima, chair of the Technical Assistance Panel and president of James Lima Planning + Development, told the Brooklyn Eagle on Monday. Lima said requirements and incentives aimed at addressing urban heat island effect could be incorporated into the rezoning.
The effect would be to “leverage” the planned rezoning for the benefit of the community, Lima said. While building requirements for developers into rezoning plans is not unique, Lima said, Gowanus has “extraordinary existing conditions,” such as very little tree canopy.
Although the exact details of the rezoning are not yet known, maximum building height and Floor Area Ratio (FAR) are likely to increase in portions of the district, resulting in an overall increase in height and bulk. Tall buildings prevent surrounding streets from releasing their heat at night.
Urban heat island effect presents “a pressing health issue,” Katharine Burgess, senior director of Urban Resilience at ULI told the Eagle. The tactical approach taken to the issue in Gowanus could be repurposed as a national model, she said.
Urban heat island’s effects are not insignificant. In Europe during a heatwave in August 2003, for example, the effect was estimated to cause up to 70,000 excess deaths, according to the March 8, 2016 issue of the journal Environmental Health.
In 2016, the NYC Department of City Planning announced that Gowanus would be one of 15 neighborhoods to be rezoned by the de Blasio administration. In anticipation of potentially dramatic changes to the neighborhood, Fifth Avenue Committee convened a coalition of local tenants, workers, businesses and community organizations to focus on issues of economic and environmental justice, protecting tenants from displacement, investing in NYCHA and other issues.
More details on recommendations in report
* Increase vegetation in the area by 20 percent, which could reduce air temperatures by approximately 3 degrees. This includes not only trees, but vines on the external walls of existing buildings and planters. This also would support stormwater retention and help mitigate flooding.
* Incentivize green building in new development. Strategies include installing green roofs, using double or triple-pane windows, and implementing envelope improvements such as insulation and breezeways. Builders could redirect and reuse the solar heat that is captured in buildings, which, if allowed to be wasted, can contribute to higher temperatures.
* Design areas and paths of respite. Major thoroughfares in Gowanus currently offer few places for pedestrians to escape the heat. Areas or paths of respite could feature cooling green infrastructure. To maximize impact, the areas could follow the area’s prevailing winds, and involve the community’s currently hidden network of creeks.
* Make the transportation system in the area more efficient. Encourage more people to use public transit to help reduce congestion and decrease emissions, which contribute to the urban heat island effect. The panel recommends more frequent bus service, sufficient bike parking, and stop sign and traffic light improvements at key intersections. The addition of a new pedestrian bridge over the Gowanus Canal on Degraw Street would allow residents to traverse the canal without using public transit.
* Turn the Con Edison lot between Baltic and Butler streets into a temporary park. With the only public park in the area, Thomas Greene Park, slated to be closed temporarily for Manufactured Gas Plan (MGP) remediation efforts in support of the Superfund cleanup, transforming the Con Edison lot into a temporary park would help residents stay cool while also serving as a place for recreation. Recommendations include a pool to compensate for the closure of the community’s only public pool, installing a pop-up tree nursery to grow trees for neighborhood streets, and adding shade elements such as trellises with vines.
The full report may be found at:
Gowanus development presents timely opportunity
A chance to address neighborhood’s unique challenges
OP-ED By: Marty Burger, Crain’s, January 8, 2018
Nearly eight years after the Environmental Protection Agency named the Gowanus Canal a Superfund site, throwing long-envisioned plans to redevelop the area into uncertainty, Gowanus is once again on the precipice of a development boom.
The South Brooklyn neighborhood is undergoing a major revitalization that is bringing residential and mixed-use development. Just last year Mayor Bill de Blasio selected Gowanus as one of several communities where developers could build bigger if 25% or more of any project’s residential units are set aside as affordable housing.
New residential dwellings, along with retail and community amenities, are welcome news for an area once dominated by industry including gas and chemical plants, paper mills and tanneries that discharged waste into its waters. But it’s important that any new development in Gowanus only move forward if it incorporates responsible green infrastructure.
The neighborhood’s troubled environmental past—along with the challenges associated with it being an urban heat island—are exactly why planners and developers need to implement a comprehensive plan to create a thriving and sustainable Gowanus.
As noted in a new report by the Urban Land Institute New York, Gowanus is significantly warmer than its surrounding neighborhoods due to a phenomenon known as the urban heat island effect. UHI happens when structures and concrete replace natural vegetation and as cars and air conditioners convert energy to heat, releasing it into the air.
UHI can lead to serious economic and health impacts, particularly for children, the elderly and underserved populations. Extreme heat events cause more deaths in the United States than all other weather-related events combined.
Gowanus is particularly vulnerable to the UHI effect because of heavy traffic, poor air and water quality and a lack of parks and other open space. And the urban heat island effect could worsen if higher-density buildings are permitted without plans in place to promote localized cooling. With responsible development, the effect can be mitigated at the same time developers are transforming Gowanus into a desirable and thriving neighborhood.
As outlined in the Urban Land Institute report, green strategies include increasing vegetative coverage wherever possible, undertaking a series of transit improvements and significantly increasing building efficiency.
For example, increasing vegetation in the area by 20% could reduce air temperatures by approximately 3 degrees, as well as support stormwater retention and help mitigate flooding. This could be accomplished by adding green roofs where possible and vines to the external walls of existing buildings, thus helping to reduce outside temperatures and cooling the buildings themselves.
Also, exposing the community’s network of hidden creeks and creating a network of green space, or areas of respite, could offer a cool and inviting public amenity. Linked together, these green corridors—aligned with prevailing winds and underground streams—could be established along wider east-west streets to capture summer breezes and circulate the air, allowing the neighborhood to cool off at night.
When building, developers should include green infrastructure technology, so their buildings can reduce the UHI effect rather than contribute to it. They should install green roofs and implement envelope improvements such as insulation to minimize energy waste. Breezeways can provide natural ventilation and encourage airflow that helps keep buildings cooler. In addition, builders should redirect and reuse solar heat that is captured in buildings rather than let it contribute to higher temperatures.
Because transit also plays an important role in mitigating the UHI effect, steps are needed to make the transportation system in the area more efficient. To entice more people to use public transit—which will help reduce vehicle congestion and emissions—there should be more frequent bus service, sufficient bike parking, and stop-sign and traffic-light improvements at key intersections. The addition of a pedestrian bridge over the Gowanus Canal on Degraw Street would allow residents to cross the canal without the need for transit.
We have a unique opportunity at hand to make Gowanus a better place to live and work for generations to come. As developers set their sights on parcels ripe for residential and mixed-use development, and as city officials plan a rezoning that will allow new high-rise complexes to grace the skyline of South Brooklyn, comprehensive plans for green infrastructure must not be overlooked.
Marty Burger is Urban Land Institute’s New York chairman and CEO of Silverstein Properties.
Seven Brooklyn developments are competing in categories such as market-rate and affordable housing, mixed-use, civic space, hotel and retail in the Urban Land Institute’s Awards for Excellence in Development
The Urban Land Institute New York (ULI NY) announced this week the 2018 final nominees for the Awards for Excellence in Development, a statewide competition that honors responsible land use and development practices. Among the 19 finalists are seven Brooklyn developments including the affordable housing development Camba Gardens, Fort Greene’s 300 Ashland and the gigantic mixed-use space City Point.
“From Buffalo to Brooklyn, our 2018 finalists represent the best in industry standards,” said Marty Burger, chairman of ULI New York. “I am delighted to announce the final 19 nominees who are the driving force behind New York’s most innovative, transformative and responsible land use projects.”
The annual Excellence in Development Awards recognize New York’s real estate leaders who demonstrate a strong commitment to planning, design, sustainability and resilience, market success and community impact. Awards categories include market-rate and affordable housing, office, mixed-use, institutional, civic space, repositioning or redevelopment, hotel and retail. Seven Brooklyn developers and development projects are among the 19 total finalists.
In the category Excellence in Housing Development – Market-Rate Housing, One John Street, a 130,000-square-foot residential development transformed from a vacant lot along the Dumbo waterfront, competes against Fort Greene’s 300 Ashland, the cultural hub and residential development that includes a 32-story residential tower and a public plaza. East Flatbush’s Camba Gardens was named a finalist in the category Excellence in Housing Development – Affordable Housing. The development was chosen as a model for public-private partnerships between a public hospital, nonprofit community-based affordable housing developer and a social service provider to facilitate tenant and community health and economic stability. Camba Gardens is competing against 461 Dean Street in Prospect Heights.
City Point, the 1.9-million-square-foot mixed-use development with a 700,000-square-foot retail center, creative office space and three residential towers with over 1,000 residential units, was named a finalist for Excellence in Retail Development. The eco-conscious 1 Hotel Brooklyn Bridge & Pierhouse at Brooklyn Bridge Park is competing against Manhattan’s Four Seasons in Excellence in Hotel Development. And last, but not least: Empire Stores, a former 19th-century coffee warehouse reimagined as a creative workplace and community hub that features retail, dining, public space and exhibition galleries in Brooklyn Bridge Park, was picked for the category Excellence in Repositioning or Redevelopment.
In September, ULI NY, which works to promote responsible use of land and the creation of sustainable communities through open exchange of ideas, information and experience, invited the development community from all across the state to submit their projects for consideration.
The awards jury, consisting of New York developers, architects, urban planners, construction managers, lenders and investors, will analyze each finalist’s project to determine how well it exemplifies the principles of ULI and the awards criteria. The winners will be announced at the Awards for Excellence Gala at Gotham Hall in NYC on April 10, 2018.
By: Rick Moriarty, Syracuse.com, January 3, 2018
Syracuse, N.Y. — A vacant downtown Syracuse office building that was turned into a mixed-use structure with apartments, office and retail space, is a finalist in the Urban Land Institute’s 2018 Excellence in Development Awards.
Icon Tower at 344 S. Warren St. is one of three finalists in the Excellence in Repositioning or Redevelopment category of the Urban Land Institute New York’s awards.
This is the third year of the statewide competition, which recognizes real estate leaders who demonstrate the strongest commitment to planning, design, sustainability and resilience, market success, and community impact.
A total of 19 finalists have been selected in eight categories. The winners will be announced at the Awards for Excellence Gala at Gotham Hall in New York City on April 10.
The Syracuse tower went vacant in 2006 after its tenant, the Excellus BlueCross BlueShield insurance company, moved to DeWitt, a Syracuse suburb.
The Icon Cos. redeveloped the building and reopened it last year with 89 apartments, office and retail space.
“By incorporating innovative and creative design, Icon Tower is now one of the centerpieces in the revitalization of Syracuse’s central business district,” the Urban Institute said.
“Featuring great city views, the ground floor is home to a thriving 5,000-square-foot restaurant, the second-floor features 20,000 square feet of Class A office space, and what had once been a 2,000-square-foot mechanical room is now a glass enclosed 24/7 rooftop fitness center.”
Completed in February 2017, all 89 apartments were leased within six months, bringing increased pedestrian traffic and new businesses to the Warren Street corridor, a previously dormant neighborhood, the institute said.
“Icon Tower not only exemplifies the resurgence of Syracuse’s central business district, but it serves as a model for the adaptive reuse of underutilized and vacant buildings in urban centers throughout Upstate New York,” it said.
Icon Tower is one of only two Upstate New York buildings among the finalists in the competition. The other is the Roswell Park Cancer Institute’s Scott Bieler Clinical Sciences Center in Buffalo. The other finalists are all in New York City.
Here is the full list of finalists:
Excellence in Housing Development:Market Rate
- One John Street – Brooklyn, NY (Alloy Development Holdings LLC, Monadnock Development Inc., and DLJ Real Estate Capital Partners)
- 300 Ashland – Brooklyn, NY (Two Trees Management)
- CAMBA Gardens – Brooklyn, NY (CAMBA Housing Ventures)
- 461 Dean Street (B2) – Brooklyn, NY (Forest City New York)
Excellence in Repositioning or Redevelopment:
- Empire Stores – Brooklyn, NY (Midtown Equities, HK Organization, and Rockwood Capital)
- Walker Tower – New York, NY (JDS Development Group)
- Icon Tower – Syracuse, NY (The Icon Companies)
Excellence in Mixed-Use Development:
- 250/252 East 57th Street Redevelopment – New York, NY (World Wide Group and Rose Associates)
- 35XV – New York, NY (Alchemy Properties)
Excellence in Institutional Development:
- The House at Cornell Tech – New York, NY (The Hudson Companies, Inc., Cornell University, and The Related Companies)
- Scott Bieler Clinical Sciences Center – Buffalo, NY (Roswell Park Cancer Institute)
Excellence in Civic Space:
- Moynihan Train Hall & James A. Farley Building Redevelopment – Phase 1 – New York, NY (Empire State Development and Amtrak)
- Washington Square Park House – New York, NY (NYC Department of Parks and Recreation)
Excellence in Retail Development:
- 195 Broadway Master Retail Redevelopment – New York, NY (L&L Holding Company)
- City Point – Brooklyn, NY (Acadia Realty Trust and Washington Square Partners)
Excellence in Office Development:
- The Bridge at Cornell Tech – New York, NY (Forest City New York)
- 4 World Trade Center – New York, NY (Silverstein Properties)
Excellence in Hotel Development:
- 1 Hotel Brooklyn Bridge & Pierhouse at Brooklyn Bridge Park – Brooklyn, NY (Toll Brothers and Starwood Capital Group)
- Four Seasons Hotel New York Downtown and Private Residences at 30 Park Place – New York, NY (Silverstein Properties)