By Flavia Leite

For more than a year, Inwood has been the stage of a drama featuring City Hall and activists from that largely working- and middle-class northern Manhattan neighborhood as the chief actors. The eventual outcome will not only shape one community’s future; it will have broader implications, too, previewing a process that will affect tens of thousands of New Yorkers living in roughly a dozen other neighborhoods that the administration of Mayor Bill de Blasio has identified for rezoning. And while the development-versus-affordability plot of the Inwood story is all too familiar in New York, research by the Center for New York City Affairs suggests ways policymakers and community leaders can learn from what has happened in Inwood and other communities, and rewrite the script in ways that might make a happier ending possible.  

Here’s the story to this point. In the autumn of 2016, the City Council resoundingly rejected a proposed Administration-endorsed “upzoning” in Inwood designed to permit construction of a new 23-story commercial and residential project. The upzoning had inspired stout resistance from community leaders unimpressed with the project developer’s pledges to include affordable apartments at the site.  Meanwhile, a far broader plan, branded “Inwood NYC,” that incorporates larger-scale zoning changes also met significant neighborhood opposition, despite months-long efforts by the City’s Economic Development Corporation (EDC) to secure community input and support. After a trip back to the drawing boards, by mid-2017 EDC was seeking to win local support for a revised plan involving somewhat less ambitious “contextual” rezoning of existing Inwood residential blocks.

But before we dive further into the details of the Inwood story, let’s step back and review how it fits into the broader political and policy contours of real estate development and housing affordability in today’s New York. 

New York City’s Affordable Housing Crisis

The city’s shortage of affordable housing has reached a crisis point. From 2005 to 2012, rents rose by 11 percent while renters’ incomes stagnated, after adjusting for inflation (see Figure 1). At the same time, while demand for housing has been increasing, housing supply has been constrained by many factors. New construction has been insufficient to accommodate growing demand; owners have opted out of subsidy programs, ceasing units' income-restriction; and a significant number of rent-regulated units have been deregulated. Between 1994 and 2012 more than 152,000 rent-stabilized units were converted to market-rate (net loss of units).[1]

In this context, Mayor de Blasio has made affordable housing a top priority, committing the City to build or preserve 200,000 affordable units by 2024. [2]

One of the strategies to increase the housing supply is the removal of regulatory and policy barriers to development. Zoning is one of these barriers. Rezoning is essentially a regulatory change to the limits on the use of land and building size, shape, height, and setbacks.[3] The debate over rezoning has gained more attention since the massive rezoning changes undertaken under the administration of de Blasio’s predecessor, Mayor Michael Bloomberg, when almost 40% of the city was rezoned.[4] Rezonings can be divided into upzonings, downzonings and contextual rezonings. Downzonings essentially reduce the buildable floor area ratio of a lot. The Furman Center at New York University, which focuses on real estate and housing policy, defines a lot as downzoned if the rezoning decreases its residential development capacity to less than 90% of its pre-rezoning capacity.[5] Upzonings increase allowed residential capacity to at least 10% more than its pre-rezoning capacity, while contextual rezonings change the limits on the use of land but do not significantly change a neighborhood residential development capacity. Instead of altering density through floor-to-area ratio (FAR) limits, contextual rezonings regulate development by, for example, limiting lot coverage or reducing the maximum height of buildings.

The primary rationale of the Department of City Planning (DCP) for the upzoning of an area is the stimulation of economic development. According to DCP, allowing the land to be developed more intensely can bring new investment to an area.[6] Evidence corroborates this idea; upzonings in the Bloomberg era immediately spurred residential construction and population growth. However, evidence also shows that even though housing supply outpaced population growth, rents in upzoned neighborhoods still increased far faster than the city’s average.[7] The demographics of neighborhoods upzoned during the Bloomberg administration also changed: the Black and Hispanic population decreased and the number of white residents increased, even though the white population declined citywide.[8]  While these upzonings may have boosted new housing stock and attracted newcomers, they also inflated housing prices, contributing to gentrification and displacement of low-income residents.

The de Blasio administration isn’t convinced that Bloomberg’s rezonings prompted displacement. At the same time it asserts that, unlike those rezonings, its strategy entails comprehensive neighborhood plans and requirements for provision of affordable housing. The City also states that it has been making unparalleled investments in the preservation of existing affordable housing and in the protection of low-income tenants facing harassment and evictions.[9] Indeed, de Blasio’s administration has a much more comprehensive rezoning strategy and many tools to maintain affordable housing; central to this approach is the Mandatory Inclusionary Housing (MIH) policy and the adoption of new tenant protections.

The Components of New York’s Affordable Housing Strategy

Approved by the City Council in March 2016, MIH requires developers to provide permanently affordable housing in areas that are rezoned to substantially increase housing capacity (upzonings). This policy is a key citywide framework for leveraging the private market to alleviate the city’s housing affordability crisis. Under MIH, the City Planning Commission and the City Council apply one or both of these two requirements to each “Mandatory Inclusionary Housing” area:

• Option 1: 25% of residential floor area must be for affordable housing units for residents with incomes averaging 60% of the Area Median Income (AMI) - with a minimum of 10% affordable at 40% AMI.  (AMI is determined annually by the Federal Department of Housing and Urban Development. For 2017, the AMI for the New York City region is $95,400 for a family of four.)
• Option 2: 30% of residential floor area must be for affordable housing units for residents with incomes averaging 80% AMI.

In practice, what this means is that an affordable housing project with an allocation of units for four-person households at 80% AMI currently has an income target of $76,320; 60% AMI equals $57,240; and 40% AMI is $38,160.[10] For purposes of comparison: the City’s poverty threshold, a local measure that is higher than the official measure and reflects the higher cost of living/housing in NYC, is $31,756 for a family of four.[11]

Tenant Protection: The main tenant protection tools created by the de Blasio Administration include:

• Lower rent increases of rent-regulated units: In 2015 and again in 2016 the City pushed for the lowest rent increases of rent-regulated units ever: No increases for one-year leases, and 2% increases for two-year leases were allowed. (These decisions were made by the Rent Guidelines Board, a nine-member body appointed by the mayor.) In 2017, the Board approved increases of 1.25% for one-year leases and 2% for two-year leases. These decisions covered some 1.6 million New Yorkers living in rent-stabilized apartments that had leases coming up for renewal.

• Launching of the Tenant Harassment Prevention Task Force: In 2015 the City joined forces with the New York State Attorney General and State housing officials to launch a Tenant Harassment Prevention Task Force “responsible to investigate potential harassment and bring enforcement actions – including civil and criminal charges – against landlords who harass tenants.”

• Increased legal support for tenants facing wrongful eviction or harassment: The Administration provided a ten-fold increase in funding for civil legal services for low-income tenants, totaling $60 million.

• Creation of the Tenant Support Unit under the Human Resources Administration: The unit’s mission includes door-to-door visits to inform tenants of their rights, documenting complaints related to harassment and eviction, and referring tenants to free legal services when appropriate.

• New anti-harassment laws: These levy increased civil penalties for tenant harassment and prohibit what are identified as “harassing” buy-out offers.

The City is also spending billions of dollars from its capital budget for construction and preservation of affordable housing – far more units of housing, including ones targeted for low-income families, than are being produced through the MIH.

Despite these efforts, de Blasio’s rezoning strategy has still faced criticism, especially when it comes to ensuring the preservation of affordable housing and guaranteeing a democratic participation process. These criticisms were evident in the rezoning process of Inwood.

Inwood: A Neighborhood Confronts Rising Housing Costs

Inwood is located at the northern tip of Manhattan, bounded by the Harlem and Hudson Rivers and by Dyckman Street, which separates the neighborhood from Washington Heights. Long an Irish neighborhood, in the late 1960s the area increasingly became home to Dominican and Cuban immigrants. Today the neighborhood is mostly Hispanic (59% of residents), followed by whites (14%), blacks (9%), and “others” (18%).[14] According to the U.S. Census Bureau, Inwood in 2015 had a total population of 42,676 people and a median household income of $46,007, compared to $53,373 citywide.

Inwood has always been an affordable neighborhood for working- and middle-class families, with housing sale prices on average one-third of prices in Manhattan as a whole.[15]  But Inwood’s economic profile has slowly begun to change. From 2010 to 2015, the number of households earning less than $50,000 a year decreased by 4%, while the number earning more than $100,000 grew 3%.[16] During the same period, the neighborhood lost 6% of its Latino population.[17]

According to the Community Service Society, rents rose 32% citywide from 2002 to 2015, but went up 55% in Inwood.  Census data also show that from 2010 to 2015 the median gross rent in Inwood grew by 10%, compared to 7% citywide. During this same period the number of units renting for more than $1,500 per month jumped from 9.8% of the total to 21.3%, while the proportion of units renting for less than $800 decreased by almost 10 percentage points.[18]

Fear of gentrification and displacement has accompanied these changes. In an interview, Renzo Moyano, a neighborhood resident and member of the coalition Northern Manhattan is Not for Sale, described Inwood as a long-ignored part of Manhattan. So when the City recently repaved neighborhood streets and put in bike lanes, it aroused mixed emotions. “I was realizing all those changes and I was so excited about them,” he recalled, “but then I was like- wait a minute, why did the City finally decide to invest here?”

Private sector investments have also aroused worries about gentrification. A New York Times article in 2014 noted that “In the last few years, Inwood has been inundated with new places to eat — as well as bike shops, wine shops and a Starbucks.” Also, real estate firms and the media have recently named Inwood and Washington Heights the last “affordable” neighborhood in Manhattan for both renting and buying.[19]

According to local City Councilman Ydanis Rodriguez, 16,000 people were priced out of Inwood and Washington Heights between 2000 and 2010.[20]   However, since 2004 the City’s Department of Housing Preservation and Development (HPD) has financed the preservation of only 1,750 affordable units in Manhattan Community District 12, which includes Inwood.[21]  

Nearly 90% of Inwood’s housing is renter-occupied and 74% of these rentals are rent-stabilized.[22] While this rent regulation may help insulate some Inwood residents from rapid rent increases, it also makes them more vulnerable to harassment from landlords seeking to exploit regulatory loopholes.[23]

Even a casual walk through the neighborhood turns up evidence of fears about such tenant harassment, like this poster put up by the Housing Rights Initiative (HRI), a non-profit organization that investigates rent overcharges and helps tenants find legal support. Announcing a neighborhood meeting on the issue, the poster went on to state:

“HRI has received multiple complaints from properties owned by *** Properties about potential illegal rent overcharges and illegal deregulations (…) In the midst of an overheated real estate market, it is important to determine whether you are being overcharged and/or whether your apartment was illegally deregulated to avoid rent spikes and displacement.”

Between 2007 and 2015 Inwood lost almost 500 rent-stabilized units, or roughly 4% of its rental housing stock.[24] During that same period the city as a whole lost 11%, or 30,000, of its rent-stabilized apartments. Nevertheless, the trend lines are worrying for long-time Inwood residents.

Inwood’s current zoning divides along 10th Avenue. The area west of this divide is predominantly zoned for residential developments, with some lots zoned for commercial and manufacturing uses. The result is a truly mixed-use district, with multi-family residences, public facilities and commercial developments. In contrast, the area east of 10th Avenue is zoned for manufacturing and is dominated by subway yards, garages, and parking lots for City agency trucks.

Sherman Plaza: An Early Stumble on the Mandatory Inclusionary Housing Path

In January 2016, Acadia Sherman Avenue LLC and Washington Square Partners submitted the first private application under the City’s new Mandatory Inclusionary Housing program.[25]  The developers sought zoning map amendments for property in Inwood, at 4650 Broadway (facing Fort Tryon Park) in order to develop a 23-story mixed-use residential and commercial building on a site currently occupied by a two-story parking garage.  Under MIH the developer would reserve 30% of the rental units in this “Sherman Plaza” project at 80% AMI.[26]
Nevertheless, Manhattan Community Board 12, which includes Inwood and Washington Heights, voted against the rezoning proposal.  (Under the City’s land use review process, community boards may cast advisory votes on major land use projects.) They considered that the percentage of affordable units in the project was too low and the affordability level was not compatible with the community’s income level. Moreover, they argued that the project was out of scale with the existing character of the community and represented a dangerous precedent for new development in the neighborhood.[27]

Manhattan Borough President Gale Brewer (whose advisory review was the next step in the land use review process) engaged in negotiations with the developers, who agreed to scale down the building to 15 stories and price 50%, instead of 30%, of the apartments at 80% AMI. Nevertheless, community opposition, fueled by fears of gentrification, persisted.

Councilman Rodriguez didn’t take a public position on Sherman Plaza until one day before a City Council vote on it (the final step in major land use reviews).[28] Rodriguez decided to oppose the plan because “in this type of community” it would create “pressure for landlords to increase rents.” In August 2016, the City Council unanimously voted against Sherman Plaza’s rezoning.  While the decision was applauded by many Inwood residents, Mayor de Blasio argued that the outcome was “not a win for the community,” since the developer now would be able to build a 14-story building at the site as of right (that is, without zoning changes or public review) and would not be required to provide any affordable housing.[29]   

Neighborhood Planning Study: Inwood NYC

Meanwhile, EDC’s "Inwood NYC" neighborhood planning study has unfolded over a longer timeline, and its reception has been more mixed.

Released in early 2015, "Inwood NYC" is, according to EDC, a “comprehensive plan of which the rezoning is only one part.” [30]  The study divides the neighborhood into two areas. West of 10th Avenue, the plan’s goal is to preserve affordable housing, support commercial corridors, and improve access to recreation and employment opportunities.[31] East of that boundary, it defines a rezoning area (see Figure 3) to be redeveloped as a mixed-use extension of the west part of the neighborhood, with new affordable and mixed-income housing and retail, commercial, and institutional spaces.

In regards to housing strategy, the plan’s basic goals are:[32]

• New construction: Developers would be mandated to provide either Option 1 or Option 2 under MIH, with the City to use subsidies to incentivize development of 100% affordable housing.

• Preservation: The City would provide loans and tax incentives to encourage building owners to preserve existing affordable units and implement an outreach strategy to promote such financing in exchange for preserving housing affordability.

• Tenant protection: In addition to citywide measures already in place, the City would:  partner with New York State to ensure that rent-stabilized tenants are not being charged unlawful rents; convene a “Problem Buildings Working Group” of elected officials, community groups, and housing advocates to identify buildings where poor housing conditions or harassment are endangering tenants; and, along with elected officials and local organizations, host a tenant resource fair and explore opportunities to set up regular tenant resource meetings.

Rezoning and its Discontents: Community Participation, Affordability, and Infrastructure

EDC asserts that Inwood NYC provides a proactive framework for growth, in the sense that it allows residents, rather than property owners, to determine the regulations that shape long-term development. The agency’s approach to community involvement - engaging over 1,700 local stakeholders through events, workshops and community surveys - was well regarded by some community leaders and by Councilman Rodriguez.[33]

While EDC’s participation process was much more collaborative compared to previous rezonings, there still exist major shortcomings. Renzo Moyano of the Northern Manhattan is Not for Sale coalition contended that months after the rezoning announcement, many members of the community were still not aware of the plan, or didn’t appreciate what rezoning even is. While community board meetings have their usual attendees, he said, they don’t typically attract poor or middle-class residents whose work schedules don’t permit attendance, or for whom English is not their first or most comfortable language. As a result the Northern Manhattan Is Not For Sale coalition and others organizations sent a letter to the mayor requesting “further extension of the timeline for the rezoning study to ensure more engagement with groups that felt underrepresented.”[34] Moreover, Moyano regarded EDC’s presentations as after-the-fact window dressing, designed to validate decisions EDC has already made. “Because of the way the City was conducting this process,” he said, “we were already against it.”[35]

The plan’s housing affordability provisions have also been a sticking point. The three principal criticisms: The promised amount of new affordable units (20% or 30% of the total) is not likely to stop upward pressure on Inwood rents; the EDC’s affordability definition is based on the metro area’s AMI, which is close to the profile of residents that live in west Inwood and earn $55,000 a year, not  those in east Inwood, where the rezoning is planned, who make around $28,000 annually; and the promised tenant protections are not sufficiently proactive, aggressive, or robust.[36]

An interview with a representative of the Housing Rights Initiative revealed that this group has increased its outreach in Inwood due to concerns about increased real estate speculation and tenant displacement. As the interviewee described, the City lacks a proactive and systematic way of looking at fraudulent practices of landlords. In general, the subsequent investigation of a rent overcharge complaint is often confined to the single unit in which the complaint was filed, as opposed to all units in the building and across buildings owned by a same landlord. A second concern raised is that residents do not know their rights and the tools at their disposal. Even though the City has created the TSU, HRI believes that the TSU still is not engaging enough with tenants.

Finally, some community groups worry that an influx of large buildings will stress Inwood’s electrical, gas, and sewer systems, which are already over capacity. Pre-war apartment buildings make up nearly three-quarters of Inwood’s housing stock and problems with electrical distribution cables are frequent.[37]  While the City has responded with promises to update the neighborhood’s old infrastructure, these pledges are not integral parts of the neighborhood plan.

The rejection of Sherman Plaza rezoning and the fierce opposition to Inwood NYC prompted the City to put the Neighborhood Study on hold.  Since the fall of 2016 it has slowed the pace to produce a draft scope of work describing the conclusion of the Neighborhood Study and details of the rezoning proposal. Instead, the City administration seems to be focusing its efforts on another project: Incorporating a residential development with 100% affordable housing units into a renovated Inwood Public Library.  

In late June 2017, the de Blasio Administration released an “Inwood NYC Action Plan” that described the proposed Inwood Library redevelopment and also updated the Administration’s larger rezoning proposals for Inwood. In the weeks that followed, comments on the action plan were taken at public hearings and in writing.

Possible Ways Forward in Inwood: Lessons of Three Other Rezonings

How can the City and community resolve their differences of opinion on Inwood NYC? How can other rezoning projects inform the Inwood rezoning process? Case studies of three earlier upzonings provide possible answers.

We examined Williamsburg-Greenpoint, East New York, and Midtown East – three very different neighborhoods, real estate markets, and zoning plans – that each provide applicable lessons for Inwood and other communities. In Williamsburg-Greenpoint we find a cautionary tale of rapid gentrification and displacement. East New York offers a community win for more units allocated to lower-income households and new investments in local infrastructure.  And Midtown East shows what early and sustained community participation in shaping rezoning priorities can look like.  

Case Study Number One: Williamsburg-Greenpoint

Greenpoint and Williamsburg are located in the northernmost area of Brooklyn. Once dominated by working-class immigrant Italian, Jewish, and Polish families, by the 1950s they had become increasingly Hispanic communities.[38] Both neighborhoods used to be zoned for “unrestricted use “with a mixture of commercial, residential, and industrial uses.[39]

In 2003, the Department of City Planning presented a zoning proposal. “The waterfront was to be rezoned to high-density residential, while areas immediately inland would be placed in mixed-use districts. Further from the waterfront, contextual districts were mapped to preserve predominantly residential blocks.”[40] Many stakeholders opposed the City’s proposal. Tenants and business owners feared displacement pressures and manufacturers saw trouble in the new mixed-use district, which would incentivize conversions to residential use. In response, the City, under Mayor Bloomberg, agreed to some small-scale adjustments to the plan: the provision of additional park space; some FAR reductions; the preservation of some industrial sites; and the implementation of voluntary inclusionary zoning on the waterfront.[41]   

In 2005 the City Council approved the rezoning resolution. Since then, residential uses have replaced much of the manufacturing uses in the mixed-use zone, reflecting the large incentives the rezoning provided for such conversions. A study done by Leon Goldberg found that between 2002 and 2013, rezoned parcels underwent many changes, including:

• Addition of nearly 10,000 housing units.
• Loss of over eight million square feet of manufacturing uses and addition of over twelve million square feet of residential uses.
• Median gross rents jumped from inflation-adjusted $949 to $1,603 per month.
• Median household incomes rose from inflation-adjusted $46,255 to $71,325.

Although the housing supply skyrocketed after the rezoning, home values and rents also increased, reflective of the fact that most of the new units were market-rate housing. The City’s new Inclusionary Housing Program (IHP) was introduced by the Bloomberg administration for the first time in Williamsburg-Greenpoint in order to win the support of the community.[42] The program provided a 33% density bonus in exchange for making 20% of the units affordable at or below 80%AMI.  As expected, the low affordability requirements of the IHP coupled with the fact that it was a voluntary program did not do much to protect Williamsburg and Greenpoint’s supply of affordable housing. As data show, from 2005 to 2013 only 13% of the units produced in the neighborhoods were affordable housing.[43]

In spite of all the promises made to the community, the Williamsburg-Greenpoint rezoning was a result of largely unilateral decisions by the City. Residents organized and manifested their concerns in public outreach meetings, but their opinions were mainly advisory. Also, language barriers and insufficient outreach from the City limited the community’s full involvement.[44]      

Although these neighborhoods were already gentrifying prior to their rezoning, data suggests that the upzoning accelerated that process. While change in the neighborhood might have been just a matter of time, the City could have traded these new development opportunities for more affordable units targeting lower income households, in addition to more actively protecting low-income residents and small businesses from displacement pressures.

Table 2- Lessons Learned from Williamsburg-Greenpoint Case Study

Case Study Number Two: East New York

In April 2016 the City approved rezoning of 190 blocks in East New York, the first area to be rezoned under Mayor de Blasio’s Housing Plan. The East New York Neighborhood Plan includes strategies for housing, economic development, and community resources, as well as land use. As the DCP Commissioner described it: “I think it underscores that we are a department of planning, not a department of zoning.”[45]

The plan’s land use strategy changes neighborhood zoning to allow for moderate- and high-density development along the major avenues of East New York while preserving the residential character of side streets and maintaining the zoning for some manufacturing uses. In terms of housing, the plan’s key strategies are:

• New construction: 25% of new housing units at an average of 60% AMI (with 10% set aside for 40% AMI) and, through a Deep Affordability Option, 20% of housing at 40% AMI. Also, through public subsidies, HPD will expedite construction of over 1,300 deeply affordable units, targeting low- and extremely low-income families.[46]

• Affordable housing preservation: The administration plans to target building owners who could benefit from HPD’s financing and tax incentives in exchange for agreeing to maintain the affordability of their units.”[47]

• Tenant protection: In addition to the services already provided by HPD’s Office of Enforcement and Neighborhood Services, the City has committed $36 million for free legal representation in Housing Court to any tenant in a rezoned neighborhood facing harassment. Further, through the City’s new Tenant Support Unit, City employees are to go door-to-door in East New York informing tenants of their rights and making referrals to free legal support.

These proposals resulted from a 21-month negotiation process with stakeholders and community groups that yielded some important results. The “deep affordability” pledge, for example, increased dramatically, from an original proposal of 100 units to 1,300 units.  Also, the modified plan includes a substantial increase, to $250 million in capital funds for, among other things, schools, transportation infrastructure, and parks.[48]

Nevertheless, the plan did not meet with universal neighborhood support.  New York Communities For Change, a nonprofit organization, issued a report in March 2016 demanding their councilmember push for deeper levels of affordability. At the same time, the East New York Neighborhood Rezoning Plan, developed by local nonprofits, called for 5,000 new apartments affordable to current residents.[49] And although the local community board and the Brooklyn borough president rejected the plan, their votes are just advisory; when the plan went to the City Council it was approved by a vote of 45-1.[50]

The East New York rezoning also reveals how even preliminary discussions of upzoning can stimulate displacement pressures. Darma Diaz, a resident of the area and a member of the Coalition for Community Advancement, said that before rezoning talks began, residents could not see gentrification and displacement pressures in East New York. However, with the rezoning announcement they saw a rise in displacement, rent increases, and an expansion in the number of single-room occupancy (SRO) units.[51] Data from the City’s Environmental Impact Statement (EIS) provides stronger evidence of this trend – it shows that the demand for housing in East New York started to accelerate two years before the rezoning announcement, that is, when rezoning talks started by DCP. The EIS also pointed out that 50,000 people were at risk of displacement.[52] However, Tom Angotti, a professor of Urban Affairs and Planning at Hunter College, argues that “the real estate speculation that had placed many people at risk was stimulated by DCP’s talk of rezoning that began some two years prior to the actual proposal.”[53]

Low-income renters are most affected by this process, especially in East New York, where a large share of the rental housing is not under rent stabilization—and is therefore harder to protect. And while the City contends that tenant protection strategies ensure that this population will stay in place, this is still unclear. Many experts and community leaders of East New York argue that they are implemented too late: after the rezoning announcement, when demand for housing had already accelerated and many tenants were being harassed or under risk of displacement.[54] Nor, critics argued, was there enough outreach to tenants facing wrongful eviction or harassment.

Table 3- Lessons Learned from East New York Case Study

Case Study Number Three: East Midtown

East Midtown Manhattan – the area surrounding Grand Central Station – is one of the largest job centers in New York City.[55] Nevertheless, the area has been facing challenges that may compromise its long-term competitiveness as a premier business district.[56] A primary issue is the area’s aging and outdated office building stock. In addition, the existing zoning framework in East Midtown discourages new construction of office buildings. Towers constructed before 1961 contain more floor area than would be permitted today.[57] According to the DCP, only three office buildings have been constructed in East Midtown from 2001 to 2013, a significant drop from preceding decades.[58]

In 2013, the City announced an East Midtown rezoning designed to ensure the area’s future as a world-class business district and major job generator for New York City.[59] But while it was approved by the City Planning Commission, that year it was withdrawn by the City “with the understanding that the project lacked City Council support for adoption.”[60]

Renewed negotiations for East Midtown rezoning – a process that concluded with unanimous City Council approval of a rezoning plan in August 2017 – began when Mayor de Blasio took office. DCP initially targeted a smaller, five-block area for a zoning text amendment, which offered the possibility to increase lot density in exchange for substantially improving the surrounding open space. The proposal allowed the development named One Vanderbilt Avenue a 30 FAR in exchange for over $225 million worth of improvements to Grand Central Terminal.[61]

After this targeted approach proved to be successful, de Blasio established the East Midtown Steering Committee.[62] It included representatives from Community Boards 5 and 6, real estate and business representatives, citywide civic organizations, and labor organizations, and was co-chaired by Manhattan Borough President Gale Brewer and the area’s councilman, Dan Garodnick. The committee was tasked with developing a new planning framework for the future of East Midtown, informing the final rezoning proposal, funding and capital commitments, and other policy decisions. In other words, the idea was to get input from all stakeholders before the official public-review process begins, “so they will be more likely to support the plan once it comes up for a vote.”[63] The East Midtown Rezoning Steering Committee met every two weeks from September 2014 until June 2015 and was advised by four planners who were part of the Pratt Institute’s graduate City & Regional Planning program.[64]

In October 2015, the committee released its final recommendations that served as a framework for the rezoning proposal led by DCP. The key recommendation of the report was that additional FAR should be earned in exchange for transit improvements, or through plaza bonuses and/or air right transfers from designated landmarks.[65]

After the committee submitted its final recommendations, DCP announced the actual rezoning proposal. The plan, which entails rezoning 73 blocks, allows the FARs in the area to reach between 18.0 and 27.0 if developers use one of these three new zoning mechanisms: (i) The completion of pre-identified improvements to subway infrastructure; (ii) Transfer of landmark development rights from landmarked buildings in East Midtown; or (iii) The rebuilding of legally overbuilt floor area for pre-1961 buildings.[66] City planners say that this rezoning proposal has the potential to pay for nearly $800 million of upgrades to subway stations and above-ground streetscapes.[67]

The debates conducted by the East Midtown Rezoning Committee over the course of more than nine months were praised for their significant community involvement and transparency. Panel discussions were organized with outside groups, such as commercial property owners, owners of designated landmarks with large amounts of unused development rights, and sustainable development and urban planning experts. According to Manhattan Borough President Brewer, “the extra time needed for the meticulous pre-planning process was necessary to iron out disagreements between stakeholders that would have stymied the plan down the road anyway.”[68]

Real estate leaders argued that such a lengthy process may not be applicable or practical in other communities.[69] Also, the precedent of requiring developers to fund public improvements may not be as applicable in other communities as it is in East Midtown, a strong market mainly composed of commercial developments. Another peculiarity of the East Midtown rezoning is the fact that the region is already very dense. As Alex Schwartz, a professor of Urban Policy at The New School, argues, much of the resistance to upzoning elsewhere in New York City reflects concerns about increased density and tangible changes to the physical character of the neighborhood, and this may be less of a concern in East Midtown.

Despite the particularities of the East Midtown rezoning, the process sets a precedent of re-zonings with meaningful community engagement and delivery of real public benefits. As Councilman Garodnick said, East Midtown “will hit the mark, and will serve as a useful precedent for other parts of the borough (…), the principles can be applied in lots of different contexts.”[70]

Table 4- Lessons Learned from East Midtown Case Study

Conclusion: Recommendations for the Inwood Rezoning

For years, New York has been watching battles play out among long-time, low-income residents, private developers, and public authorities. With Mayor Bill de Blasio’s plan to rezone as many as 15 neighborhoods, these conflicts are not likely to decline.  Low-income renters, who live in communities that have suffered from long-term disinvestment, fear that new investments and improvements will spur gentrification and displacement. Private developers, searching for developable land at a good price, want to invest in new areas. Public authorities, trying to address the city’s affordable housing crisis, seek to create opportunities for housing growth through rezonings.

Rezoning is a strategy that the City can use to leverage the private sector to generate some assistance and support for low-income renters. De Blasio’s rezoning policy, put in place with mandatory inclusionary requirements and increased tenant protection tools, has the important role of supplementing the affordable housing already built with public subsidies. Without this strategy, New York would have fewer resources to provide affordable housing assistance.

However, this rezoning strategy does not go without criticisms. As many community advocates argue, the inflationary pressures on rents caused by increased densities (upzonings) and other changes in neighborhood fabric may make many more units unaffordable and foster landlord harassment.  In other words, rezonings may cause a net loss of affordable housing in spite of a higher percentage of mandatory affordable units. Indeed, data shows that upzonings made during the Bloomberg administration have inflated housing prices, contributing to gentrification and displacement of low-income residents. However, the idea that rezonings inevitably lead to gentrification and displacement not only fails to recognize that rents are rising in many neighborhoods even without upzonings, but also ignores the fact that de Blasio’s administration has put in place a much more comprehensive rezoning strategy.

Inwood’s classic profile of a hot real estate market in a traditionally low-income/working-class neighborhood suggests that a rezoning can act as a "Trojan Horse" for real estate speculation and gentrification. However, as the case studies indicate, there is a place for rezoning strategy if it is done right. As the case studies suggest, engaging communities in comprehensive planning for their own neighborhoods, making rents more adequate to the income level of residents in the targeted neighborhoods, and improving tenant protection tools may be part of the solution for this battle.

Table 5- Inwood Rezoning: Issues and Recommendations

[*] In October 2016, Council members Ritchie Torres, Dan Garodnick and Jumaane Williams introduced two bills that would offer protections against abusive landlord practices. The first one (Intro 1210-2016) requires HPD to keep and publish a watch list of multiple dwelling owners who have engaged in tenant harassment.   The bill would “require the Department of Finance to assist HPD in determining certain financial information about covered multiple dwellings.”[71] The second bill (Intro 1211-2016) “creates a rebuttable presumption that where a multiple dwelling has a debt service ratio of less than 1.05, harassing acts or omissions committed by the owner of such multiple dwelling caused or were intended to cause the tenant to vacate the dwelling.”[72]  In other words, tenant charges against landlords due to harassing acts or omissions that caused or were intended to cause tenants to vacate their housing unit will be believed to be true unless the owner can prove otherwise.

[1] [2] City of New York 2013

[3] NYC Planning n.d.

[4] The New York Times 2013

[5] [6] Armstrong, et al. 2010

[7] [8] Goldberg 2015

[9] The Official Website of the City of New York 2016

[10] HPD website: http://www1.nyc.gov/site/hpd/about/what-is-affordable-housing.page

[11] NYC Government Poverty Measure – 2017 Report.  Citing 2015 data and the poverty level for a family of four

[12] City Planning Commission 2016

[13] Thomas Angotti 2016

[14] United States Census Bureau 2017

[15] Hughes 2014

[16] [17] [18] United States Census Bureau 2017

[19] In 2016 one-bedroom apartments in the area were available for $300,000, an amount significantly below the median $815,000 price of a one-bedroom across Manhattan as a whole. Hackman 2016

[20] Wishnia 2016

[21] NYC EDC n.d.

[22] Krauss 2015

[23] Savitch-Lew, Aging Infrastructure an Issue in Bid to Reshape Inwood 2016

[24] Krauss 2015

[25] City Planning Comission 2016

[26] 10 percent would have been for families earning 60 percent of AMI ($49,000) and 20 percent for families making 110 to 135 percent of AMI ($90,000–$110,000). (City Planning Comission 2016)

[27] City Planning Comission 2016

[28] Wachs 2016

[29] Toure 2016

[30] [31] NYC EDC n.d

[32]  The 2015 Plan was presented during a forum in Inwood. (NYC EDC n.d.)

[33] NYC EDC n.d.

[34] Savitch-Lew, City Takes Time With Inwood Rezoning Process 2016

[35] Interview with Renzo Moyano

[36] Interview with Renzo Moyano and U.S Census Bureau Data

[37] Wishnia 2016

[38] Thomas Angotti 2016

[39] [40] [41] [42] Goldberg 2015

[43] Office of Council Member Brad Lander 2013

[44] Thomas Angotti 2016

[45] Savitch-Lew, Fight Over De Blasio Plan for East New York Will Be About More than Housing 2015

[46] The City, through HPD, will only finance buildings that are 100% affordable: 40% of all units will be reserved for households earning less than 50% of AMI and the remainder of the units would primarily be affordable to households making 60% of AMI. HPD will provide the Extremely Low & Low-Income Affordability (ELLA) Program across the neighborhood, including all private sites that choose to take City subsidy (NYC City Council 2015)

[47] NYC Department of City Planning 2015

[48] NYC City Council 2015

[49] Even though the East New York Plan represents a new way of planning for a rezoning, with unprecedented affordable housing and capital improvements, many argue that its broader strokes are not revolutionary: more than 6,000 new apartments by 2030, only half of which will be guaranteed below market-rate. Further, many consider that the affordability levels established are not adequate, considering that more than a third of East New York families make $23,350 (30% AMI) a year or less.

[50] Whitford 2016

[51] (Schwartz, Angotti and Diaz 2017) Once a single-family home, a building can be dissected into single room occupancy units offered at a fraction of the cost of a full apartment. Four/five people share the rent that before was paid by one family.

[52] NYC Department of City Planning 2016

[53] Thomas Angotti 2016

[54] Schwartz, Angotti and Diaz 2017) and Interview Tom Angotti

[55] The proposal area straddles the border of Manhattan Community Districts 5 and 6, and is generally bounded by Fifth Avenue, Third Avenue, East 39th Street and East 57th Street. This area is anchored by Grand Central Terminal.

[56] NYC Department of City Planning 2015

[57] [58] NYC Department of City Planning 2013

[59] [60] [61] [62] NYC Department of City Planning n.d.

[63] Anuta 2016

[64] [65] East Midtown Steering Committee 2015

[66] Overbuilt sites (where FAR exceeds that now allowed by zoning) should have the ability to be demolished and build back their existing FAR as-of-right without transfers or bonuses, if they contribute to the Public Real Improvement Fund. (NYC Department of City Planning n.d.)

[67] Cuozo 2017

[68] Anuta 2016

[69] Coltin 2015

[70] Anuta 2016

[71] [72] City Council, 2016

INTERVIEWS

• Tom Angotti (Professor of Urban Affairs and Planning at Hunter College and co-editor of the book Zoned Out!) - Interview: 03/17/2017
• Robert Snyder (Director of the Graduate Program in American Studies at Rutgers-Newark, author of Crossing Broadway Washington Heights and the Promise of New York City) – Interview: 03/13/2017
• Renzo Moyano (Northern Manhattan Is Not for Sale) – Interview: 03/14/2017
• Aaron Carr (Housing Rights Initiative) – Interview: 04/21/2017

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Flávia Leite holds a BA in economics from the University of São Paulo and a master’s degree in Urban Policy Analysis and Management from The New School. She prepared this policy brief for the Center for New York City Affairs as her master's thesis.

Karla Polo designed this report, including the chart and graph. She is a research assistant for the Center for New York City Affairs working on graphic design and website management, and a master’s candidate at Parsons, the New School for Design, majoring in Fine Arts, Design and Technology.

Cover Photo by Kim Snyder