GUEST COMMENTARY: City Turns Back on Rational Zoning

Rendering of the proposed new building at 250 Water Street, which will replace a parking lot. Image Credit: NYC LPC

Zoning is under attack in New York City. Not here or there, in this location or that, but the concept itself. This has been the long game of the city’s real estate interests, and after a decade of raids those interests have launched a full assault on several fronts. The historic city should expect no quarter.

Defenders of the historic city face foes on many fronts. One front is what is known as spot-zoning, that is, upzoning a single parcel to allow construction greater than legally permitted. A prime example is the Blood Center on East 66^th Street. The zoning covering much of the Upper East Side permitted tall structures along the avenues while buildings of lower scale would line the side streets, with ample sunshine reaching sidewalks and parks. That pattern has yielded both new development and the preservation of blocks of lower scale row houses. Now a developer declares that such an arrangement ought not to apply to his midblock plot. He claims a right to build taller. If the city agrees, then the established pattern will be smashed and zoning will have no meaning at all.

Another such example is an empty block in the South Street Seaport Historic District. 250 Water Street was vacant when the Landmarks Preservation Commission designated the historic district in 1977, so clearly the commission intended to regulate whatever new construction was proposed. In 2003, specifically to prevent out-of-scale development, City Planning downzoned the block to limit height and bulk there.

But now, the Landmarks Commission, drawing inspiration not from the low-scale blocks in the district but the high rise residential and commercial buildings beyond, has approved a 345-foot residential tower, bursting through the allowable zoning envelope. In this case, the city did not approach zoning as a standard it was bound to enforce on behalf of its citizens, but interpreted it as a minor inconvenience for the Howard Hughes Corporation, which felt it deserved more. The developer muddied the waters by promising units of so-called affordable housing and tying their application to with the fate of the nearly destitute South Street Seaport Museum, dangling a $50 million donation to generate support. In truth, there is no guarantee that the museum will ever receive anything.

The battle over a proposed residential tower in Crown Heights also involves a cultural institution. Pitched as badly needed affordable housing, though the building would have more market rate units, the building would cast the Brooklyn Botanical Garden into perpetual shadow. Here the city is prioritizing the promise of affordable housing over all other values, and is essentially telling Brooklynites that what they prize, a world-renowned botanical garden, is illegitimate and other politically determined needs take precedence. Again, this is spot zoning to benefit a single developer to the detriment of the community in which he intends to build, and to the detriment a world-class institution.

To be clear: in each of these examples of spot zoning community opposition is not, repeat, not opposed to any new construction. Communities oppose granting exemptions from the zoning regulations, rules that all others must adhere to, for the benefit of a private interest, regardless of whether it is cloaked in a public benefit. Had these developers submitted plans to erect an as-of-right structure, there would have been no opposition. But by supporting and advocating for these applications for a zoning variance, the city renders its own zoning regulations less a matter of law and merely a matter of opinion.

A second front in the zoning war involves what might be called a creative interpretation of the rules. Three recent examples ended up in court. At 200 Amsterdam, the developer crafted a 39-sided zoning lot, sections of which were merely sidewalks connecting small open spaces. The Municipal Art Society and the Committee for Environmentally Sound Development sued, claiming that this gerrymandered lot did not comply with the clear language of the rules. Remarkably, in February 2020, State Supreme Court Justice W. Franc Perry not only ordered the Department of Buildings to revoke the permit, but ordered the builder remove as many floors as necessary to bring the tower into compliance with the existing zoning. The developer appealed, and continued to build. Their gamble was rewarded when in March 2021 the Appellate Division reversed the lower court decision and declared the tower legal. The 52-story, 668-foot structure will hold only 112 condominiums. Not one of those units could be classed as “affordable housing.” For whose benefit did the de Blasio administration vigorously defend this building against the citizens who opposed it?

A second case is the residential tower begun at 50 West 66^th Street. Here the Extell Corporation sought to combine zoning lots and apply the rules in such a way as would most benefit their project. Where they originally received approval for an as-of-right building of 291 feet, they amended their design and the now 69-story building would top out at 775-feet. The kicker, however, was that it was to be only 39 stories, for inserted into the design were “mechanical voids” totaling more than a quarter of the height. The City Club of New York sued the Board of Standards and Appeals, and in September 2020 Justice Arthur Engoron ruled against the building. In a stinging decision he wrote:

“This blatant jacking-up of close to 200-feet (originally set at 214-feet, with a cavernous 160-feet floor, more appropriate for a satellite transmission tower or a circus big-top) is too brazen to be called a ‘subterfuge’; rather, the Developer simply thumbed its nose at the rules. The Proposal’s mechanical voids would be ingenious if they were not so transparent (the word “chutzpah” comes to mind). No sane system of city planning, and no sane system of judicial adjudication would allow developers to end-run around height-limits by including in buildings gargantuan mechanical spaces that may not even contain mechanical equipment and have no purpose other than to augment height beyond otherwise legal limits.”

Extell appealed, and in July 2021 the Appellate Division reversed Judge Engoron. The illegal tower was now perfectly legal. As at 200 Amsterdam, not one of the units would be classed as “affordable housing.” Which begs the question: why would a city government so intent on fostering the construction of affordable housing fight so aggressively on behalf of developers building condominiums for the ultra-wealthy?

The third example resulted in the dreadful decision by the Court of Appeals in Peyton v. NYC Board of Standards and Appeals in December 2020. That decision has made it almost impossible for citizens to prevail. Residents of Park West Village, residential buildings located on West 97^th Street dating from the 1960s, sued to block construction of an infill tower on open space in the complex. In granting approval, the BSA counted a private rooftop garden accessible only to residents of that building as open space, thereby interpreting the rules to permit the infill tower. The residents won in the lower courts, but in a 4-3 decision the state’s highest court ruled that “the agency charged with administering the Zoning Resolution in all its complexity is well placed to understand how the various parts of the statute fit together.” In sum, what the BSA decides is correct because the BSA decided it, even if it is contrary to the language or intent of the zoning resolution. If deference to an agency decision is all but absolute, citizens now have little chance of a legal victory. Indeed, the Appellate Division recently decided against the City Club in our suit over the tower on West 66^th Street citing the Peyton precedent (attorney John Low-Beer represented the plaintiffs in both cases, and commented on Peyton in CityLand here.

What is clear is that city agencies – the Department of Buildings, the Department of City Planning, the Board of Standards and Appeals, and most disappointingly the Landmarks Preservation Commission – all further the designs of private developers seeking to exceed the allowable zoning or violate the protections granted historic districts. Citizens and good government groups dig deep into their own pockets to file suits seeking nothing more than to compel the city to enforce its own regulations. In return, they are vilified as the enemy.

The complicity of the city in this egregious over-building is especially clear in the upzoning of East Midtown in 2017. This plan might be better understood as “zoning for dollars.” In return for allowing construction of a building taller and bulkier than the zoning provides for, the city would receive payment to fund public amenities. The intent is to improve the transit connections around Grand Central, but that will prove a phantom benefit, as the subway lines are already over capacity, and the new commercial towers will add thousands more workers flooding the area every day. It is scarcely possible to add capacity to the subway platforms under the terminal, regardless of how many more street entrances are opened.

The result of this rezoning is that no structure is too big, or too historic not to be demolished and replaced with something bigger and newer. The collection of masonry buildings surrounding Grand Central, once known fondly as Terminal City, will soon be no more.

The first to fall was 270 Park Avenue. Designed as the headquarters of Union Carbide by Gordon Bunshaft and Natalie de Bois of Skidmore, Owings & Merrill, the 708-foot tower was completed in 1960 (it had been extensively renovated only a few years before to become more energy efficient). J.P. Morgan Chase began demolition in 2019, and the building gained the dubious distinction as the tallest skyscraper in the world to be intentionally demolished. A 1388-foot tower will rise in its place. For the privilege, J.P. Morgan Chase paid the city $40 million intended for transit improvements, broadly defined. Thus “zoning for dollars.”

Next up will be the Hotel Commodore, just east of Grand Central on 42^nd Street. An 80-story tower is planned there, and at street level the design will simply brutalize the urban fabric. The monster is as far from human-scale as possible, and proud of it. Sadly, the Landmarks Preservation Commission gave the tower a pass, even though it will affect portions of the designated terminal. That decision, too, is being challenged in court.

In 2020 the de Blasio administration launched a full frontal assault on historic districts with a proposal to upzone SoHo and NoHo together with a slice of Chinatown, a total of 56 blocks. The stated goal was to foster the construction of affordable housing. By implication, those neighborhoods were exclusionary for limiting what could be built – the obvious result of the zoning resolution and the landmarks law – and the privileged residents were by implication discriminating against the more diverse population that would be accommodated. In truth, the proposal targets many rent-regulated tenements occupied by low-income families, many of them Chinese immigrants and would likely eliminate more units of affordable housing than would be built.

Despite the administration’s rhetoric, not one unit of affordable housing would have to be built. A study by Village Preservation determined that the proposed FAR (floor area ratio) would be set at 12, the maximum allowable under state law. The FAR of Billionaires Row, the supertalls rising along 57^th Street, is only 10. In other words, there is no limit to what could be built under this upzoning, and it goes without saying that the promise of affordable units – affordable being pegged at a family income of $122,000 – will never be fulfilled. Instead the city will gain more units for the super wealthy, and not a few of those will be merely cashboxes in the sky, a safe investment for off shore fortunes.

Proponents of this proposal never specifically rebut the arguments made by opponents, instead tossing out ill-defined but loaded words like affordable housing, privileged, exclusionary, or elitist. Rather than engage in a contest of ideas and facts, they hurl only nasty ad hominem attacks. Never will the mayor explain why towers designed for the ultra-wealthy and big box retail will be good for the city and its citizens.

Should this proposal be approved, every historic district in the city will be in peril, and the residents who oppose new construction for being out of scale and contrary to the historic context will be further vilified by the political class and the media for seeking the exclusion of the less wealthy and less white.

Rebuffed by city agencies, many good government organizations and community groups have been forced to take their battle into the courts. In addition to the City Club, the list includes the Municipal Art Society, Friends of the Upper East Side Historic Districts, Landmark West!, Save Our Seaport, the Committee for Environmentally Sound Development, and the Tribeca Trust. Tenant groups in the Two Bridges neighborhood, supported by Borough President Gale Brewer, sued to block construction of four supertalls on the waterfront, arguing that the applicants had to go through the ULURP process. The lower court agreed, but that decision was reversed and construction can now proceed absent the public review almost all other projects are subject to.

The city, of course, enjoys almost unlimited resources, while citizens must struggle to raise the tens of thousands of dollars required for each filing. Should the citizens prevail in the lower court, as has happened on several occasions, the city simply appeals to the next level, compelling communities to raise additional funds.

The shameful truth is that the de Blasio administration has turned its back on the citizens who have loved their city and dedicated years to enhancing its livability. Notwithstanding the insistent claims that upzoning is necessary to provide affordable housing or that it will result in public enhancements or support for public institutions, the plain truth is that the war on zoning benefits no one but the real estate interests poised to reap enormous profits. It is an ugly form of cynicism that would label civic-minded individuals banding together to oppose such interests as the enemy.

By: Jeffrey Kroessler (Jeffrey Kroessler is the President of the City Club of New York.)