Tag Archives: developer

New luxury NYC condo building gives affordable housing residents their own back entrance

Posted on by

A new luxury condo building in New York City has space for affordable housing – but those residents have to use a separate, back entrance:

The poor will use a separate door under plans for a new Upper West Side luxury tower — where affordable housing will be segregated from ritzy waterfront condos despite being in the same building.

Manhattan developer Extell is seeking millions in air rights and tax breaks for building 55 low-income units at 40 Riverside Boulevard, but the company is sequestering the cash-poor tenants who make the lucrative incentives possible.

Five floors of affordable housing will face away from the Hudson River and have a separate entrance, elevator and maintenance company, while 219 market-rate condominiums will overlook the waterfront…

“It’s a blatant attempt to segregate people,” fumed Rosenthal, who is demanding that HPD deny Extell’s request for tax breaks. “It’s just not a good thing for the city of New York to be supporting.”“I hate the visual of market-rate tenants going in one door and affordable tenants going in another, but that’s a visceral reaction,” Diller said.

I’m not sure we should be all that surprised. Developers generally don’t want to construct affordable housing because it cuts into the profits they could make. This is particularly the case in dense areas like Manhattan where land is at a premium and using some of the space for affordable housing means leaving money on the table. So, if the city is going to offer tax breaks for including some affordable housing units (and this is a common strategy for encouraging affordable housing), why wouldn’t a developer want to separate the exits so the wealthy can think they live in a building solely with other wealthy people (and will pay more for this appearance)?

On the other hand, perhaps New York needs to add to what it means by “affordable housing.” It is one thing just to require units. It is another to place wealthier and less-wealthy residents closer together so they might actually interact. This is the sort of “black box” behind mixed-income neighborhoods that replaced public housing high-rises in many American cities. The idea is that more regular contact between wealthier and less wealthy residents will help those less wealthy residents in the long run.

Housing, IP, and Disney

Posted on by

A New York Times article from last week reports on the convergence of housing, intellectual property, and the Walt Disney Corporation in a recently built suburban home near Salt Lake City:

The sherbet-colored structure sits at the intersection of Meadowside Drive and Herriman Rose Boulevard here, but you don’t need directions to find it. Just look for the swarm of helium-filled balloons that the developer tied to the chimney of a house that has a gabled roof, scalloped siding and a garden hose neatly coiled next to the porch — all details taken from “Up,” the 2009 hit about an old man and his flying abode.

Developer Blair Bangerter duplicated Pixar’s Up house with as much fidelity as physical reality would allow.  And he got permission to do this from Disney!  As the article notes, getting such permission from Disney is highly unusual:

This is a company that once forced a Florida day care center to remove an unauthorized Minnie Mouse mural. More recently, Disney told a stonemason that carving Winnie the Pooh into a child’s gravestone would violate its copyright [though it later “reversed its ruling on that Winnie the Pooh tombstone after the news media reported the rejection”].

So how is a homebuilder in this Salt Lake City suburb getting away with selling a near-identical copy of the floating house in the Disney-Pixar film “Up”?

Although Disney declined to comment for the story, the article suggests several reasons:

  • The developer is the son of a former Utah governor.
  • The developer was able to convince Up‘s director, Pete Docter, to “personally intervened on behalf of the project.”
  • Disney “is trying to evaluate with more care the hundreds of requests it receives a month from people wanting to use its characters and imagery.”

Taking these suggested reasons at face value, it sounds like Mr. Bangerter obtained permission primarily because (a) he was well-connected and (b) Disney sensed a PR opportunity.  There are at least two ways of interpreting this:

  1. Bangerter and Disney saw a market opportunity and bargained to create value.  Most homes in the subdivision are priced around $300,000; the Up home is listed at $400,000.  Disney is often seen as an IP bully; it now looks a bit nicer.  Thus, a deal between Bangerter and Disney created almost $100k in new economic value for the developer and (possible) new goodwill towards Disney.
  2. IP is being used here to create an unnecessary monopoly rent to benefit the already well-connected.  It’s hard to see how Disney would suffer any economic loss if everyone were free to build Up houses–Disney is in the business of selling media and related merchandise, but generally not houses.  However, since everyone is presumably not free to build Up houses, Bangerter and Disney had to spend time and money hammering out an agreement.  As a result of their agreement, Bangerter (apparently) gets ~$100k more for the Up house than he gets for comparable houses in the subdivision, and Disney successfully pacifies a politically powerful developer.

Especially insofar as Disney only considers such deals with well-connected developers like Bangerter, the IP issues quickly blur into fairness issues.

Competition for Empire State Building on NYC skyline

Posted on by

A developer has proposed a new skyscraper near the Empire State Building (ESB) in New York City and the ESB’s owner is arguing against it:

The tower would spoil the famous view of the 102-story skyscraper for millions of tourists, the Empire State Building’s owner, Anthony Malkin, testified Monday at a City Council hearing. It “defines New York,” he said.

“We view this as an assault on New York City and its iconography,” said Malkin, whose grandfather founded the Malkin Holdings company. It’s “the end of the image of New York City that billions of people hold dear.”

The City Council is to vote this week on whether to allow a developer to erect a 67-story tower that’s only 34 feet lower than the 79-year-old Empire State Building, the city’s tallest skyscraper.

The proposed tower’s developer, David Greenbaum, says 15 Penn Plaza would provide critically needed and state-of-the-art office space to midtown Manhattan, creating at least 7,000 new jobs.

“The fact is, New York City’s skyline has never stopped changing, and I certainly hope it never will,” testified Greenbaum, president of Vornado Realty Trust’s New York chapter.

This is an interesting example of many development battles: someone wants to make money with a new building and someone else wants to preserve what the neighborhood (and perhaps wants to protect their own investment).

I have a hard time buying the argument that the building shouldn’t be built because it is “an assault on New York City.” As the developer notes, skylines change pretty frequently. There could be other arguments to make against the building but preserving the skyline doesn’t sound reasonable. In fact, the changing of the skyline is often part of what makes cities interesting; they are consistently changing.