ULI New York Blog

Recap: Does Amazon Signal the End of A Pro-Growth Political Climate in NYC?

By: Laszlo Syrop

In November 2018, Amazon announced that, following a 14-month public competition, it had chosen the Long Island City neighborhood of Queens, in New York City, as one of two locations for its planned second headquarters (HQ2). But in February 2019, following criticism and controversy, the company reversed course and ceased planning for its New York location. From the outset of Amazon’s HQ2 competition announcement, the saga has invited voluminous commentary of all stripes and from all corners of public opinion.

On Monday, May 13th, ULI New York brought together a panel to revisit the company’s withdrawal and its significance for the city at an event titled “Does Amazon Signal the End of a Pro-Growth Political Climate in New York City?” Kathryn S. Wylde, President and CEO of the Partnership for NYC – a non-profit that represents local business leaders and large employers – moderated the group, whose remarks drew on its members’ experience across both the private and public sectors under multiple city administrations.

While it was a wide-ranging discussion, several recurrent themes emerged across the course of the conversation. The panel seemed in agreement that, indeed, the overall landscape – political, social, and technological – has shifted.

Vishaan Chakrabati – founder of the architectural studio the Practice for Architecture and Urbanism, Associate Professor at Columbia University’s Graduate School of Architecture, Planning and Preservation, and former Manhattan Director for the Department of City Planning under Mayor Michael Bloomberg – neatly summarized the political dynamics at play in the initial controversy that followed Amazon’s selection.

“What we saw was an intertwining of [larger political] narratives with [local] anxieties about growth,” he remarked. In part, this is fueled by media accounts that misrepresent the true nature of the subsidies and incentives that private sector actors are offered. However, what is particularly different in the current environment, he emphasized, are the means by which those anxieties are transmitted: “social media is the megaphone.” This in turn, he argued, requires a greater level of responsive agility on the part of city officials and other pro-growth actors.

As a city that has always provided a relatively high level of social welfare programs, there has historically been a widespread understanding across the political spectrum that growth is necessary to provide the resources such programs require, reflected Carl Weisbrod – Senior Advisor to the consultancy HR&A Advisors, former Chairman of the City Planning Commission and Director of the Department of City Planning, and Founding President of the New York City Economic Development Corporation. That calculus is only truer today as state and federal support has diminished over time, he continued, yet support for growth seems to have eroded significantly.

Another difference in the contemporary landscape, Weisbrod pointed out, is that the transformational economic development initiatives the city has long aimed to execute in areas outside of Manhattan, such as Long Island City, are suddenly gaining traction since few scale development opportunities remain in that borough. This change may be partly responsible for the public push-back which caught many of those involved in bringing Amazon to New York off-guard.

“I would wager that if Amazon had announced it were relocating to Hudson Yards, or the World Trade Center, or Times Square, or any [number of other developed Manhattan locations], we wouldn’t be having this conversation today.”

When the conversation turned to the question of lessons learned from the experience – as it did several times – the panelists’ perspectives were less frequently in alignment and concrete answers seemed more elusive. The point that seemed to draw the most universal agreement from the night’s panelists, was that communications surrounding the project could have been improved.

Reflecting on opinion polls which showed a majority of respondents supported the plan to bring Amazon to Queens, James Patchett – President of the New York City Economic Development Corporation – noted that proponents could “do a better job telling the story.”

Engaging community stakeholders in a planning framework as an antecedent to entitlements is an important procedural step and helps provide members of the public with assurance that “back-room deals aren’t being cut,” Chakrabati advocated, before conceding that the unique nature of Amazon’s competitive process meant the deck was stacked, against those who might have advocated greater transparency and community engagement.

A strategic, pre-emptive approach to educating future corporate partners about doing business in New York would be beneficial, Wylde suggested, in response to an audience question.

Adding another dimension to the panel’s meditations on communications strategies, Weisbrod offered that more effective models of community engagement than “the mandatory large meetings, which seem to invite people to yell and scream,” are warranted. Individuated engagement programs take longer, but tend to have more productive outcomes, he observed.

In contrast to the general consensus regarding communications, there seemed to be little certainty or congruence amongst the group when it came to other substantive measures to employ in the future.

At varying points in the discussion, Patchett pushed back against implications that proponents had made significant mis-steps, suggesting that it was primarily Amazon’s unwillingness to work with the city to address opponents’ concerns that deprived the city of the opportunity it would have had to deliver on the promises it had made and the community engagement processes it had laid out, both of which would have ultimately allayed many concerns. Pointing to an example where the city and EDC had successfully built community trust through such a model of delivering on promises made, Patchett highlighted the new, recently opened Essex Market. Separately, he also cautioned that the uniqueness of the Amazon situation might preclude the usefulness of extrapolating many lessons from it.

Nonetheless, he acknowledged, “people have legitimate concerns and we need to have real answers for them.” While not explicitly the province of the EDC, programs like Mandatory Inclusionary Housing (MIH), Universal Pre-K, and Paid Sick Leave help to ensure that New York City remains a place where people can see themselves getting by, he suggested.

Weisbrod had a slightly different perspective. While programs like MIH are beneficial measures for the city to institute, ultimately they primarily matter for their direct beneficiaries, leaving the housing needs of others and other difficult realities unaddressed.

“We can all say that growth is great, but we all also realize that the city is crumbling, at a certain level.”

To address the acute infrastructure challenges posed by growth, it behooves the city to make expansionary programs concomitant with investments in that infrastructure, he argued. As a laudable example, Weisbrod pointed to the rezoning of East Midtown which was begun under the Bloomberg administration and was completed under the administration of Mayor Bill De Blasio. Acknowledging that it might be a somewhat controversial proposal, Weisbrod also suggested that additional tenant protections and rent stabilization measures might be worth consideration to help address displacement risks.

Behind the lack of consensus on tangible solutions to the thorny predicament of Amazon’s departure, lie several vexing structural challenges, the discussion’s participants conceded.

“The city lacks upwardly-mobile entry level jobs,” for people who are neither lower-skilled minimum-wage earners nor highly-skilled workers, Wylde pointed out. With those jobs largely relocated to low-cost states like North Carolina, Utah, and Florida, it is difficult for many recent college graduates to find employment opportunities in the city.

The city’s housing shortage is another major constraining factor influencing growth, Weisbrod stressed. When young people are increasingly priced out of the city, so too will talent migrate away, and eventually this will threaten the city’s attractiveness to businesses.

“Talent attracts businesses, businesses do not attract talent.”

But while all the participants expressed healthy concern for the city’s continued competitiveness and economic health, they acknowledged its strengths in the context of its long history.

The whole back-and-forth with Amazon “validated that New York City is a true tech capital,” Patchett reflected, adding that the EDC has since been in conversation with multiple additional tech-sector companies interested in opportunities to grow locally. Likewise, EDC still believes there are compelling options available for developing the erstwhile Amazon site, though it is taking time to retool its plans and engage the local community more deeply.

Importantly, Weisbrod reminded the audience in closing, we would all do best to contain our sense of nostalgia.

“We’re in a golden age – not everyone is doing well, but as a city we’re in a much better place than we have been.”

Recalling a fabled story, Weisbrod invoked the words of former Mayor Ed Koch, who – when beseeched by a woman on the Coney Island Boardwalk to “make the city like it used to be” – allegedly retorted, “lady, it was never that great.”

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