It’s been roughly two decades since any real construction occurred in a 73-block stretch in Midtown East, even though it’s considered one of the region’s prime office districts. 
That may soon change amid a controversial plan set forth by Mayor Michael Bloomberg, which would result in rezoning the area, making it available to develop a host of new skyscraper office spaces, restaurants, hotels, and more.
Our New York City commercial zoning lawyers know that going up against current zoning standards can be an uphill battle for any business. Those hoping to develop on the property would best secure sound legal advice while these processes are underway. Something on this scale was bound to draw at least some ire – and this certainly has proven no exception.
Hundreds of opponents – met by hundreds of supporters – showed up at a recent council hearing to voice their stance.
The area in question surrounds the Grand Central Terminal. It’s been largely abandoned by developers over the last several decades. On average, most buildings are nearly 75 years old. The Real Estate Board of New York estimates that 8 out of 10 buildings are at least 50 years old.
Over the last ten years, just two new offices have been developed in the neighborhood. Modernization must occur if the area wishes to compete globally – which many have said continues to be one of New York’s core goals.
That will mean the renovation of current structures and the construction of many new ones.
Proponents of the re-zoning effort say that Bloomberg’s plan would allow the neighborhood to draw some tax revenue, something many say is desperately-needed. A recent council amendment would allow 20 percent of the space in any new commercial skyscraper for residential purposes.
Additionally, Bloomberg’s plan would allow developers to purchase more air rights from the city for as little as $250 per square foot through district improvement bonuses. That would help to pay for improvements to public space in the area.
The way the zoning for the area is currently written, developers can’t redevelop an older office structure unless a quarter of the structure is maintained. By being granted permission to tear down entire structures and rebuild from the ground up, developers say they can build a more sustainable area.
For opponents, one of the major problems with the New York City rezoning is the perception that air rights are being sold at basement bargain prices, in some cases for much lower than the market rate.
There are also tightly-held parameters within the legislation. One of those involves a clause stating that to qualify for the deal, the property has to occupy a full block front. On this basis alone, some say the benefits of the rezoning initiative would be limited at best, as many properties wouldn’t qualify. They say the proposal is rushed and has the potential to quickly overwhelm a neighborhood whose streets are already packed with congestion and where subway lines are already overcrowded.
Some are suggesting a more modest proposal of the same measure be introduced.
The council is expected to vote on the New York City rezoning sometime this month.
The Wright Law Firm is a business law firm located in Midtown Manhattan. Call (212) 619-1500 for a confidential consultation.
Additional Resources:
Clock Ticking, Bloomberg Seeks Council Approval of East Midtown Rezoning Plan, Oct. 21, 2013, By Charles V. Bagli, The New York Times