Sunday, October 16, 2011

Gateway Redux: Wal-Mart and the Need for Willets Point Oversight

Crain's is reporting on the bids that NYC EDC has received for its phony Phase I of the Willets Point development-a phase that simply didn't exist when the plan was approved by the NYC Council three long years ago. And lo and behold, one of the bidders is the Related Companies-the same out fit that has used a bait and switch strategy to site Wal-Mart at its Gateway Mall in East NY:

"Almost five years after Mayor Michael Bloomberg unveiled a sweeping plan to make over Willets Point, a 61-acre swath of pockmarked streets and auto shops in northeast Queens, the redevelopment is finally springing to life. At least four teams of bidders submitted proposals to build the project's first phase, and off-site infrastructure improvements will begin this fall in an area that has bedeviled politicians and planners since Robert Moses.

Crain's has identified four of the bidders, including The Related Companies and Silverstein Properties, though none of them would comment, citing a gag order imposed by the city

It was the failure of the City Council to conduct an adequate oversight of the Gateway expansion-with CM Barron relying on the company's "word"-that allowed Related to sneak Wal-Mart into its retail mix. And it is the same lack of oversight that will allow Related-or any of the other developers-to do the same thing at Willets Point because, in giving its approval for the Iron Triangle, the Council gave the city carte blanche to site whatever retail use it wanted on the site.

This isn't sitting well with Local 1500 of the UFCW: "Some of the bids themselves have sparked controversy. United Food and Commercial Workers Union Local 1500 said it will vigorously oppose Related's bid because the developer is considering leasing a Brooklyn site to Walmart. The union is trying to prevent the retail giant from entering New York City."

Well, we feel 1500's pain; but a remedy is available to all of the folks in the anti-Wal-Mart coalition. That remedy lies with the fact that this Phase I is arguably an illegal segmentation that was never approved by the city council-and with enough political pressure the entire Phase could-and should-be subjected to a full ULURP review (with another EIS to address the concerns that have been raised by us here at WPU.

The only reason that there is this phased approach is because WPU has stymied the city on the building of ramps off of the Van Wyck-a matter that is now before Judge Madden's court. In pleadings before the judge the city had said that it wouldn't go forward with the project and condemn anyone's property until the ramps were approved: clearly it lied and Phase I is an illegal end around the nettlesome ramp issue.

This all opens up an opportunity for a full oversight review of the development-one that should include an economic impact analysis because no one knows what the real price tag of the development is:

"Even as the project moves forward, questions remain. The redevelopment is complicated, requiring environmental remediation, infrastructure upgrades and land acquisition. The city controls 90% of the phase-one areas, but has not ruled out using eminent domain to secure the remaining parcels, which would create a storm of opposition.

Perhaps more significantly, the division of the project into three stages—intended to get it started faster—has raised doubts that it will work financially for developers. The first phase calls for up to 680,000 square feet of retail space, as many as 400 units of mixed-income housing, up to 387 hotel rooms and about two acres of open space. The city has also asked developers to propose a vision for future stages

At a time of budgetary cutbacks does this development still make fiscal sense? And then there's a clamor to make the area into the next Silicon Valley:

"To reach the full potential of Applied Science NYC, the city will need to think bigger and more holistically. And to build an educational and robust commercial tech corridor capable of competing with Silicon Valley, the university will need more developable space and to be globally accessible. There is a location, though, that offers accessibility and expandability, and the opportunity to build not just another Silicon Alley or Square, but a Silicon City, and it is right here in our borough’s backyard: Willets Point."

Is that a good idea? Who knows? But what we do know is that this concept wasn't part of the discussion three years ago and the fact that it might be considered highlights how all of the oversight from back then is just so inconsequential-reinforcing the need for the council to finally do its job.

For us the fact that TDC is a bidder adds insult to injury-part of the reason why we have pushed the NYS AG to act:"The TDC bid has also elicited howls from opponents of the project, led by the holdout property owners group Willets Point United. It argues that TDC should be barred from participating because it was part of the Flushing Willets Point Corona Local Development Corp., a nonprofit organization partially funded by the city that advocated for the redevelopment. Attorney General Eric Schneiderman is investigating whether the LDC illegally lobbied for the project."

We also can't know whether a phased approach is economical:

"The biggest challenges, though, may lie in the impact that dividing the project into phases may have on the redevelopment's economics. The city won't reveal what the firms have proposed, but observers question whether the first phase has enough housing units to make residential development viable. Responses are likely focused on entertainment, retail and hospitality, they said. Because the project requires substantial remediation, is in a flood plain, and the first phase is just 12.75 acres, it will be hard for its developer to make the finances work."

All of the above makes it imperative for the city council to step into the breach it has created for itself-a refocus on Willets Point, its environmental impact, its economic plan and its fiscal feasibility, all need to be re-examined before the city creates the same kind of empty lot that exists in New London where Suzette Kelo's house used to stand.