The Real Deal New York

Domino affordable housing would be permanent, developers say

March 01, 2010 06:26PM
By Sarah Ryley


From left: Michael Lappin, CPC Resources Senior Vice President Susan Pollock and the Domino sign

The developers of the Domino Sugar Refinery site on the Williamsburg waterfront responded to one of the project’s main criticisms — that its 660 affordable apartments would become market-rate after 15 years — by saying today that housing would permanently stay affordable.

Susan Pollock, senior vice president of project developer CPC Resources, said the about-face came after realizing the rezoning for Williamsburg and Greenpoint passed in 2005 required waterfront developers to include permanent, not temporary, affordable housing in their projects in order to receive a density bonus.

Although the five-block Domino site, once the world’s largest sugar refinery, was not included in that rezoning, Pollock said they promised to follow those rules for the project’s 660 affordable apartments, out of 2,200 condos and rental units spread throughout six buildings that would be constructed over a 10-year period.

Additionally, the developers had already planned to include a higher percentage of affordable apartments then dictated in that rezoning — 30 percent, as opposed to 20 percent.

“I think that’s great news. There’s so many big parts to this rezoning, but that was certainly a very important piece of it,” said Ward Dennis, who heads the local community board’s land use committee and has pushed to modify the project.

The developers, CPC Resources and the Katan Group, bought the site for $55.8 million in 2004 after sugar refining operations closed down. Plans for the site were revealed two years later, but were delayed when the city’s Landmark Preservation Commission forced the developers in 2007 to preserve the main 12-story brick refinery, as well as the iconic yellow “Domino Sugar.”

Last week, the $1.2 billion project finally began its eight-month public review process with a rejection from the community board’s land use subcommittee, mainly due to concerns over its temporary affordability, density and the strain it would place on area infrastructure already heavily taxed by the recent development boom.

“People are starting to comprehend the realities of what all the past rezonings have done in terms of the tax on infrastructure and the like,” said Dennis, who abstained from voting last week. He said he would wait to see how the developers respond to all of the board’s concerns before deciding on his vote.

The project will go before the full community board March 8. Although its vote is only an advisory opinion, during the last rezoning the board successfully pushed for increased affordability requirements on the waterfront and smaller density inland.

Phil DePaolo, a local activist who opposes the project, was not moved by the promise of permanent affordable housing, mainly because the income limits for 85 percent of those apartments are higher than the average annual income of a household currently living in South Williamsburg, which is $35,000 for a family of four.

Of the 660 below-market apartments, only 15 percent are rentals set aside for an income equivalent to a family of four earning up to $23,040. Half would be rentals set aside for a household income equivalent to a family of four earning up to $46,080; 20 percent would be for sale to those earning an income equivalent to a family of four earning up to $99,840; and 15 percent would be rentals for seniors with incomes up to $38,400.

Additionally, he said the project’s 1,540 market-rate apartments would put upward pricing pressure on the entire neighborhood since rents and for-sale prices are determined by nearby comparables.

“Not only does it change the landscape as far as gentrifying the neighborhood, but it also changes the commercial corridor,” DePaolo said. “It gets more upscale with bars and restaurants. You walk down Bedford Avenue on the Southside now and it’s party central.”

Pollock said the density of market-rate units is necessary to make the whole project financially feasible, especially considering the preservation requirements.

“The refinery is an incredibly expensive undertaking. No other developer on the waterfront is preserving any historical property on the site,” said Pollock, adding that its preservation added “tens of millions of dollars” to the cost of the project.

Its brick facade “is really like a wrapping paper for sugar refining equipment. And so there are huge vats, centrifuges, ovens that rise many stories throughout the building. And there are catwalks around them so the workers can get to the equipment,” Pollock said.

“It’s nothing you can use, you have to take it apart very carefully because the equipment is so massive and so much a part of the structure of the building that, if you take the equipment down, the walls may collapse. So you have to brace all the walls as you’re doing the work, and cut up the machinery very carefully, and lift it up from the roof in pieces,” she said.

“It’s phenomenally expensive,” Pollock said.

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