Columbia University has already won approval for a controversial $7 billion expansion of its campus into West Harlem. But now New York City’s proposal to rezone another piece of Harlem—the neighborhood’s cultural and business center on 125th Street—is igniting another firestorm.
In October, the Department of City Planning proposed the creation of a “special purpose district” ranging from 124th to 126th streets, between Broadway and Second Avenue. According to the city, it would create 1.8 million square feet of office, retail and hotel space, and 2,500 new residential units, including 500 affordable housing units.
The proposal has won conditional approval from two community boards, but was voted down by another in Central Harlem, Community Board 10. The city must complete its review of the plan by March 10.
On one side of the battle are real estate developers, many of whom have already placed their bets on changes in the neighborhood; on the other, local businesses and residents who fear displacement.
Harlem’s main retail corridor, 125th Street, already hit a turning point in 2001, when former President Bill Clinton signed a 10-year lease on a penthouse office there.
The street has since seen the opening of storefront branches of national chains like Starbucks and Old Navy, but the new rezoning will bring both new mixed-use development and cultural institutions. In November, after three years, the state selected the Danforth Development Partners to redevelop the Victoria Theater, which will house the Jazz Museum, the Classical Theatre of Harlem and the Harlem Arts Alliance in addition to a hotel and condominiums. Many expect that to act as a magnet for other cultural institutions along the 125th Street corridor.
Vornado leads
Commercial investment around 125th Street took on a new reality in 2006, when Vornado Realty Trust announced plans to take over the dormant Harlem Park project on 125th Street and Park Avenue.
That project had originally been envisioned as a $236 million office, retail and condo complex to be anchored by a Marriott Courtyard hotel; however, the developer failed to obtain the necessary financing. Vornado and MacFarlane Partners stepped in and unveiled a new plan last year that would offer 540,000 square feet of Class A office space and 90,000 square feet of retail.
After that, more developers started snapping up property in the area. “That brought a tremendous number of developers who never would have considered commercial development uptown,” said Shimon Shkury, managing director/partner at Massey Knakal.
Late last month, sources said that Major League Baseball would move a new cable channel into Vornado’s planned 21-story cubed office tower and that Inner City Broadcasting, a radio network with a largely black audience, was negotiating with Vornado for space at the site too. Vornado is, however, pushing for the city to lift its proposed height requirement for the project.
If the project gets built, it would be the first major office building on 125th Street in about 40 years. But there have been other deals since Vornado announced its plans for Harlem Park.
Denver-based Aimco paid $53 million to buy 189,000 square feet of rental apartments and commercial space on Adam Clayton Powell Boulevard in the 130s.
And, a 70,000-square-foot storage space at 40 Convent Avenue, between 129th and 130th Street, was put on the market in January by brokerage Eastern Consolidated for owners Bejam International Corp. The owners are entertaining offers in the range of $14 million, or $200 a square foot, according to Jared Toothman of Eastern Consolidated.
“The fact that 125th Street is coming up helps anything in the immediate vicinity,” Toothman said.
As mayor, Michael Bloomberg has aggressively promoted zoning changes as a tool for
economic development, rezoning more than one-sixth of the entire city. Harlem has seen two rezonings in the area around 125th Street: from East 99th Street to East 122nd Street, and a 44-block area around Frederick Douglass Boulevard, between West 110th and West 124th Street. Both passed in 2003.
However, the deal that fueled much of the current outrage occurred in July, when commercial brokerage Giscombe Henderson brokered the $50 million sale of 16 retail stores on Frederick Douglass Boulevard to Sigfeld Group and Kimco Realty Corp., a New Hyde Park, N.Y.-based developer of shopping centers.
The partnership paid a record $1,430 a square foot, the most ever paid for a retail acquisition in Harlem, and moved to evict several long-time restaurants and retailers in the neighborhood, including Bobby’s Happy House, the oldest black-owned retailer in the community. Bobby’s closed last month.
When it voted down the 125th Street proposal, Community Board 10 indicated it would reconsider if provisions were added to preserve space for local businesses and nonprofit groups and lower the income requirements for affordable housing to prevent displacement of residents.
“I would like to see our local merchants that have been here for such a long time to have the opportunity to remain in Harlem,” said Franc Perry, chairman of Community Board 10. “I would not like to see 125th Street develop into one large commercial mall. We want the flavor of Harlem and 125th Street to remain.”
A spokesperson for the planning department, Rachaele Raynoff, said, “We are not upzoning areas on 125th Street where there is a solid residential presence.” Raynoff added, “We are imposing height limits for the first time so there is not an incentive to tear
down buildings.”
Larry Rose, vice president of development at Kimco, said he considers the site the best available retail location in the area and insists the partnership is committed to Harlem.
“We’re very bullish on Harlem, and we’re long-term players,” said Rose. “We’re not looking to buy these properties, fix them up and sell them.”
Rose said the new project will be a mixed-use development, with retail on the ground floor—and possibly the second floor—as well as office space. He said he understands that asking retail rents are going for anywhere from $150 to $225 per square foot in the area, and that he has been talking with major retail brands, but he declined to elaborate.
At press time, community activists were scheduled to rally in late January in front of the Record Shack, a local music store facing eviction by its landlord, United House of Prayer. Sikhulu Shange, a South African immigrant who has owned the store for 35 years, said the rezoning is nothing more than an attempt to change Harlem’s demographic.
“Here comes somebody from another neighborhood and says that these businesses are not worthwhile,” said Shange. “The entire idea of rezoning 125th Street is to get rid of the residents of Harlem, period.”