Four Case Studies on the Lower East Side

45-Rivington_AG

In the following case studies I researched four organizations that impact the Lower East Side and comment on them. I explore the issues of local politics, gentrification, government transparency, corporate power, and the voice of the people. I provide bullet points to highlight important facts of each organization and list my sources below, and lastly list common themes all four organizations display.

Rivington House
Provides a compelling but sad case study of gentrification and globalism. This case reveals how businessmen see even nursing homes as a kind of stock investment or some other way to make a profit. To them, it’s about abstract numbers, not the people under their ward.

China Vank show how globalism and gentrification often go hand in hand. Vank buys businesses overseas like Sydney and New York because overseas property gives a lot of advantages when pursuing profit. Vank doesn’t have to build any new buildings and they can attract upper-middle class Chinese tourists, immigrants, and Chinese-American citizens to invest in their condo. They also avoid problems in China’s housing market.

Allure Group has a history of pursuing profit at the expense of their old patients, where they sell a nursing home to a big business (like China Vank) that are willing to pay a handsome price to renovate it into a condo or other apartment complex. How they convinced DCAS to lift the deed under City Hall’s nose is very troubling. It shows a lack of transparency, and how local politicians can’t even communicate with government bureaucracies.

China Vank building a new condo will displace many old patients but it will also have many far-reaching effects. It will drive up the property value and price of living in the Lower East Side and it will aggravate racial tensions, not of just Latinos and Jews to Asians but of Asians to each other.

  • Served as a nursing home for 200 AIDS patients
  • Owners sold the building for $16.15 million to China Vank Co.
    • Will turn it to a luxury condo
  • Former owners were Allure Group, for-profit nursing home provider.
    • Purchased building from VillageCare in 2014 for $28 million
    • Requested DCAS to lift deed in December 2014 to allow the nursing home to be run for profit.
    • Plan on relocating the nursing home around the neighborhood, but this claim has little evidence.
  • Allure Group sold another nursing home to a real estate developer last fall.
    • Real estate developers plan to demolish 4 story nursing home.
    • Replace it with 241-unit residential building at 270 Nostrand Avenue in Bedford-Stuyvesant
  • China Vank Co.
    • A large international corporation that buys from local firms in America, including New York
    • Turn overseas partly because of China’s slumping housing market
    • And escapes need to invest too much money in a real estate project
    • Different motives from Chinese businesses
      • Wanda wants profits from tourism
      • Vanke wants places for Chinese people to live and own property
    • Investigators conclude:
      • “There is a complete lack of accountability within City government regarding deed restriction removals and significant communication failures between and within City Hall and DCAS (the Department of Citywide Administrative Services).”
    • Mayor De Blasio plans to invest $16 million to Lower East Side after this fiasco
      • 13,000 signed petition urges De Blasio to revoke Rivington sale

Sources
http://gothamist.com/2016/07/14/doi_rivington_house_report.php
http://gothamist.com/2016/02/29/les_luxury_condos_everywhere.php
http://therealdeal.com/2015/10/09/park-developers-planning-241-unit-resi-building-in-bed-stuy/
http://therealdeal.com/2016/02/29/vanke-adam-america-slate-pay-116m-for-les-dev-site/
http://therealdeal.com/2015/06/02/what-the-vanke-wanda-partnership-means-for-new-york/
http://evgrieve.com/2015/12/what-next-then-for-45-rivington-st.html
http://www.thelodownny.com/leslog/tag/rivington-house#
http://www.nydailynews.com/new-york/petition-urges-de-blasio-stop-sale-rivington-house-article-1.2690302

Extell Development Company
This case study reveals a broader plan companies like Extell has. Extell does build condos on the Lower East Side but has many buildings in Midtown like One57. It does display a kind of cannibalism, like how they even buy off buildings, like Lee’s Art Shop, in the affluent Carnegie Hall area to turn it into Billionaire’s Row. Other purchases seem perplexing, like building an 18 story condo tower and buying a 17 story apartment building.

But these purchases do make sense when you see that CEO Gary Barnett has an overall business strategy. He wants to combine all the condos he bought in midtown Manhattan over the years into a large development site. It’s effectively a fortress, since Barnett will have a monopoly over the area, meaning he will get almost all the profits. It’s a stake of territory.

Barnett does have interests in the Lower East Side too since the area dose not have rezoning protection, meaning he can make a condo as big as he wants. His Extel building, the “Building From Hell”, is an example. The building threatens the literal foundations of people’s apartments, like cracking the walls and sinking the ground. It is a “Vertical Village” where wealthy tenants can have an “authentic” Disneyland Manhattan experience.

  • Develops luxury condos in New York for living and business
  • Serves on the boards of the New York Building Congress
  • Plans on building another luxury condo tower on West 57th St. but is only 18 stories high and in 2008, Extell bought a 17-story apartment building at 134 W. 58th St.
  • But is also building a 1,550 foot condo to rival One57 buildings
  • Other purchases
    • Transforming Carnegie Hall into Billionaire’s Row, like buying Lee’s Art Shop to urban developers for $85 million
    • Buying Calvary Baptist Church and the Salisbury Hotel for $100 million to build another 1,000+ foot condo to rival One57 buildings
  • CEO Gary Barnett’s business strategy: assemble properties over a long period of time to combine into a single, large development site in midtown Manhattan
  • JDS rivals Extell in Lower East Side (north of Washington Bridge)
    • Excel has 85 story tower of luxury apartments
    • JDS plans to build a 70 story tower nearby, razing a Community Center on Cherry St.
    • Promises to flood-proof the property and upgrade the lobby and the $51 million spent should go to non-profits
  • Protestors dub Extel building “The Building From Hell”
    • Construction of building damages their apartments
    • Land under the apartments sinks
    • Building is a “Vertical Village”, providing gardens, romantic fire pits, and other luxuries to rich tenants
    • Department of City Planning rejected Chinatown Working Group pleas for rezoning protection
    • Why billionaires build luxury hotels and apartments there, because no limits on building height

Sources:
http://www.extelldev.com/extell_residential_forsale.html
http://www.crainsnewyork.com/article/20160712/REAL_ESTATE/160719975/extell-development-planned-to-build-another-luxury-condo-tower-on-west-57th-st-now-its-replacing-a-17-story-building-with-one-thats-18-stories
http://www.crainsnewyork.com/article/20160607/REAL_ESTATE/160609914/busy-billionaires-row-area-could-get-another-pricey-project
http://www.crainsnewyork.com/article/20150503/REAL_ESTATE/150509974/
http://ny.curbed.com/2016/4/27/11520138/jds-lower-east-side-tower-247-cherry
http://thevillager.com/2016/03/03/new-extell-building-is-wrecking-the-hood-in-many-ways-locals/

RAD/PACT
PACT is essentially an attempt to improve on the outdated infrastructure and tenant policies on the Lower East Side. They see the problem partly stemming from a lack of federal spending, so PACT requests money from the government to help tenants out. They plan to renovate the many aged apartments themselves and improve the policies and legal work related to the apartments such as paying rent giving tenants a way to efficiently settle any problems they have. PACT also hopes the renovation will attract investments from philanthropists and other businessmen to boost the infrastructure even more.

PACT, at heart, wishes to save Lower East Side tenants and the apartments they live in from decades of neglect and political corruption. They hope to do this in a conventional way: by receiving money from the federal government and investing that money to improve the lives of tenants. However, this attempt is essentially relying on a corrupt system to fix corruption.

  • PACT is the implementation of the U.S. Department of Housing and Urban Development’s Rental Assistance Demonstration (RAD)
  • NYCHA needs $17 billion
  • Major upgrades to 5,200 apartments
    • Modernizations, permanent affordability, tenant protections
    • Implementation of RAD include comprehensive mold remediation, roof or façade replacements, new kitchens, bathrooms, and flooring, renovated hallways and stairwells, upgrades to lighting, fencing, doors, windows, and common areas such as basketball courts.
  • Repairs to almost 30,000 units of public housing
  • Specific buildings in Manhattan
    • Manhattanville Rehab
    • Wise Rehab
    • WSUR Brownstones
  • “A major step forward! Insures decent living standards for everyone!” Declares supporters.
  • Federal funds to NYC tenants have been in decline. PACT and RAD are attempts to pump government money for public welfare.
  • Other stipulations
    • Contracts to make homes permanently affordable are renewed every 20 years to keep them affordable.
    • Tenants pay no more than 30% rent, can run organizations valid to NYCHA, and will have their complaints listened to
  • Part of NextGeneration NYCHA 10 year plan
    • Improve financial stability by improving rent and fee collection and central office costs
    • Play the role of an effective landlord, with efficient customer service, increase safety, and put the power of urban development to local people
    • Rebuild, expand, and preserve affordable housing stock
    • Attract philanthropists to invest money by creating non-profit organizations
    • Give residents contacts to more workforce opportunities

Sources:
https://www1.nyc.gov/site/nycha/about/press/pr-2016/nycha-announces-pact-and-plans-for-1-billion-in-major-upgrades-to-5200-apartments-20160630.page
https://www1.nyc.gov/assets/nycha/downloads/pdf/pact-factsheet.pdf
http://www1.nyc.gov/assets/nycha/downloads/pdf/nextgen-nycha-web.pdf

Battery Park City Authority
In this case study we see the typical frictions between people and corporations, even corporations that claim to benefit the people. Yet BPCA is also a state agency, responsible for administrating policy decisions for Battery Park. BCPA shows that there is not a clear line between government agencies or programs, which we like to think helps the people, and corporate interests, which we often see as self-serving. The distinction is actually blurred, as government and corporations are often married.

Either way BCPA is another bureaucracy with little contact with the people it claims to serve. It’s members make decisions on their own terms, not on the terms of the people. Most don’t even live in the area. Ultimately they mimic corporate interests because they ultimately bend over to larger interests like bigger corporations. This case study reveals potential pitfalls in government planning we should be wary about. BCPA made a lot of strange decisions, like replacing the PEP with security guards and removing the Manhattan Yacht Club and Ms. Huxley, but they make sense when the above points are considered.

  • Battery City Park is a public-benefit corporation, a corporation that claims to create a “balanced” community by keeping people in commercial, residential, and park spaces fulfilled while not compromising anyone else
  • Has a rich legacy of Arab-American communities, dubbed “Little Syria”, going on from the 19th century to 1950, but the shadow still remains
  • Before Battery Park the area shipped goods from New York to new Jersey
  • Replaced Park Enforcement Patrol Officers with private security guards
    • Have little power: can’t make arrests or write summonses
    • A more “effective” alternative
    • BCPA does not “listen to the community”, as decision was done with no consideration for the public
    • Other unpopular decisions:
      • replacing Manhattan Yact Club with a larger marina operator
      • retires Huxley, longtime Conservatory executive who maintained the neighborhood through sustainable policies
    • Of BCPA’s seven members only one actually lives in Battery Park
      • State Sen. Daniel Squadron and Assemblywoman Deborah Glick have introduced a bill that would require a majority of BPCA members to live in the area
      • Local people want to gain greater control of BCPA, a state agency

Sources:
http://www.nytimes.com/2010/08/25/nyregion/25quarter.html?_r=0
http://query.nytimes.com/gst/abstract.html?res=9D04E5D91339E23ABC4952DFBE66838D659EDE&legacy=true
https://www.dnainfo.com/new-york/20160201/financial-district/battery-park-city-authority-cuts-all-park-enforcement-patrol-officers
https://www.dnainfo.com/new-york/20160127/battery-park-city/elected-officials-call-for-local-control-of-battery-park-city-authority
https://www.dnainfo.com/new-york/20141010/battery-park-city/longtime-downtown-marina-operator-may-lose-control-bigger-company
https://www.dnainfo.com/new-york/20150818/battery-park-city/new-bpc-parks-head-named-after-controversial-exit-of-longtime-parks-leader
http://www.downtownexpress.com/2015/07/30/huxley-park-leader-of-battery-park-city-is-leaving-in-apparent-forced-move/

Common themes:

  • Large, sometimes oversees corporations, seek to gentrify the Lower East Side, replacing public space into property privately owned by the very wealthy.
  • Often the corporations seek to erect luxury condos to enact a larger plan: to transform the area itself into an affluent living town. Colonizing a neighborhood creates a place where wealthy communities can congregate. Profits can be easily made and commerce with other wealthy interests can take place.
  • PACT is a desperate attempt to use government money to fix a long-neglected infrastructure. The problems run deep and are related to capitalism, racism, and class struggles.
  • BCPA reveals a typical conflict between the people and institutions charged with caring for them. The BCPA does indeed serve the people by tending to the infrastructures and communities of the area, but when push comes to shove they ignore the people’s voice and put them second.

 

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