The biggest obstacle to building schools in New York City now is not money or political will – it’s simply finding the real estate.
Of the 63,000 desks proposed in Mayor Michael Bloomberg’s plan to construct new schools, the city has yet to find sites for about a fifth – nearly 13,000 – of them. The School Construction Authority has four real estate firms – Cornerstone, Newmark, Colliers and Cushman & Wakefield – under contract to scout potential school sites.
While in most cases the city develops schools on land it purchases or already owns, school construction officials are returning to an older strategy of joining with private developers to build schools as part of new residential projects. The model, pioneered during the fiscal crisis of the 1970s as a way to build schools at a lower cost to the city, has rarely been used since. But the Bloomberg administration revived the process, run through a public benefit corporation known as the Educational Construction Fund.
The World-Wide Group, for example, was tapped by the ECF in a 2006 deal to build new space for the High School of Art and Design and P.S. 59 in return for rights to build a 59-story residential tower at 57th Street and Second Avenue. Now with available space tighter than ever, some see the idea gaining more currency with developers and school construction officials alike.
“I thought way back in the late ’70s and early ’80s that this was the way to go for the future,” says John Caiazzo, former head of the Educational Construction Fund and now the director of real estate development for the DeMatteis Organizations, one of the city’s largest school builders. “The city would probably want to develop as many sites as possible where they can develop a combined occupancy facility.”
That’s the framework that DeMatteis, in partnership with the Mattone Group, is using to build a new 32-story tower on First Avenue at 91st Street. The developers won a 75-year ground lease from the city to build on the site of an old, vacant school. Under the deal, they will build a new five-story, 72,000-square-foot middle school adjacent to their residential development, dubbed Azure.
The developers will pay the cost of both the $45.5 million school and the $103.5 million tower, which is set to be complete in 2009.
The tower will include 205,000 residential square feet and 4,000 square feet of commercial space. The deal will allow the developers to sell 127 co-op units starting around $1,100 per square foot. Leasing the property rather than buying it outright reduced their costs, Caiazzo says, giving the project a competitive price for the Upper East Side. They also benefited from buying the air rights over the school, adding about 23,000 square feet to the residential project.
“All the unused floor area above the school is transferred to the tower,” he says. “A lot of schools sit on valuable property, and they do not take advantage of all the floor area you can build on the site.”
The school plot is an L-shaped strip of land between 91st and 92nd streets in the middle of the block, next to the planned residential tower, which will front on First Avenue. While the desirable location may be a boon to developers, it also demonstrates the difficulty school builders are having in finding adequate space for their budgets. “It’s on an extremely constrained site,” says Paul Broches, a partner at Mitchell/Giurgola Architects, which designed the school. “We were able to slide the school next to the apartment building.”
He adds, “what makes it complicated is the kinds of sites [we have] to work with.” He cited the small or oddly shaped lots, brownfields and other tough spaces that school builders consider. “They weren’t built on for a reason,” he says.
The space crunch is also evident at Millennium High School, which has occupied the 11th, 12th and 13th floors of 75 Broad Street in the Financial District since the city leased the space from JEMB Realty in 2003.
Reading, writing, renderings
Despite the scarcity of land, building schools is a booming business in New York City. The city’s current building plan calls for 110 new schools to start construction between 2005 and 2009. The capital plan, budgeted at $13.1 billion over the five years, is by far the city’s largest.
A large chunk of the spending, $4.7 billion, is slated for new school buildings. The rest goes to renovations, expanding existing schools and leasing space. The expansion outpaces what previous administrations had committed. The prior five-year capital plan, which covered 2000 to 2004, only spent $2 billion on building capacity, according to an assessment by the Independent Budget Office, the city’s fiscal watchdog. (Of that, $1.4 billion went to new school buildings.)
Bloomberg, who won direct control of the city’s schools from the Board of Education in 2002, proposed his ambitious construction plan the next year. The current plan has been expanded dramatically even since the first draft was released in 2003. Although the number of proposed seats remains at 63,000, the number of proposed new school buildings had ballooned from 76 to 110. That’s because many of the sites were too small to accommodate larger buildings. “We are committed to creating 63,305 seats,” says SCA spokesperson Margie Feinberg. “As locations are sited and the optimal number of seats is defined for each location, the number of buildings will fluctuate.”
The building plans come despite enrollment declines that school officials predict will continue into the next decade. New York’s public schools shed 49,000 students between 2000 and 2005, dropping from over 1.1 million to about 1.05 million, according to the SCA’s latest demographic data. In an annual document known as the Grier Report, demographers estimated that the public school population will drop below 900,000 by 2015.
The city is also in the process of closing schools that it says are failing; at least a dozen closures have been announced this year. Some of the schools will be phased out slowly. Others will be closed immediately and reconfigured in the same building – sometimes several smaller schools will share a building that once housed one large school.
Even with dropping enrollments, though, Feinberg says the current expansion is intended to relieve overcrowding that has persisted in many neighborhood schools for years. “While we project overall decline in enrollment, there are and will continue to be pockets of overcrowding and areas of enrollment growth,” she says.
Public/private partnerships may be the key to building schools in the future. Officials are already eyeing a 630-seat school near 37th Street and 10th Avenue in anticipation of the Hudson Yards redevelopment. The city is also reviewing the potential needs around developments on East 25th Street, Queens West and the Atlantic Yards, according to a memo in the latest version of the capital plan.
The school building boom isn’t exclusive to New York City. Nationwide spending on school construction projects completed in 2007 was expected to reach $21.8 billion, with $13.9 billion going to new schools, according to the annual School Construction Report by School Planning & Management, an industry trade magazine. The figure, up from $20.1 billion in 2006, eclipses school construction spending in any previous year.
“Educational facilities generally in a city are expanding due to the increased growth of a city. The city’s getting larger, [with] more people, more children, and it’s a number of seats the Board of Education has to provide,” says Robert Purcell, partner at Bostwick Purcell Architects in Port Chester, N.Y. His firm currently has four school designs under construction in New York City, including Gregorio Luperon High School at 165th Street and Amsterdam Avenue and three elementary schools.
The demographic pressures are evident in New York, but other factors have driven the school building boom as well. For Bloomberg to make his building plan a reality, the city needed an infusion of money from the state. That came in 2006, when the state agreed to pay for half the $13.1 billion plan as part of the settlement to a 13-year lawsuit that charged the state with shortchanging city schools for decades.
Another factor behind the flurry of school building is a reform that greatly cut the per-square-foot cost of new schools: In 2002, the city consolidated responsibility for such projects under the School Construction Authority. Before then, the SCA had shared its duties with the city’s Division of School Facilities. Work was plagued with cost overruns and delays, with no single agency held responsible for getting shovels in the ground, according to reports at the time. The merger, combined with more competitive bidding practices, cut the cost of building new schools (in 2007 dollars) from $590 per square foot in fiscal 2002 to $440 per square foot in fiscal 2007, according to the SCA’s Feinberg.
With available space as tight as ever, some expect the SCA to increasingly join with developers to incorporate schools into their projects. “The city is so in need of seats that they’re really open to any kind of collaboration where they can get land to put seats,” says Mark Lippi, a principal architect at RMJM Hillier, which currently has two city school projects underway. “They’re willing to sit down and work out the contracts and make these things happen.”