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spring 03 Matters Newsletter.qxd - zicklin : school of business - CUNY


Quarterly Bulletin:

The Steven L. Newman

Real Estate Institute

Real Estate Matters is a quarterly bulletin published by The Steven L. Newman Real

Estate Institute at Baruch College/City University of New York. The Institute is a component

of the William Newman Programs in Real Estate at Baruch, comprising, in addition


to the Institute, academic real estate degree programs in the Zicklin School of

Business and the School of Public Affairs, and the Institute’s nondegree

professional Certificate Program in Real Estate, administered

in cooperation with Baruch’s Division of Continuing and

Professional Studies. The programs represent New York’s comprehensive

approach to real estate education and public policy.

Real Estate











Editorial Matters:



Market Matters:

State of Real Estate:

New York City:

Spring 2003

Educational Matters:

Newman Academic


Certificate Programs

Matters of Record:



Matters of Concern:



Matters of Concern:

Jersey City:

Borough Six?

Matters of Concern:

Big Brooklyn Box:


Matters of Concern:

Ground Zero Update:


Archival Matters:

The World’s

Largest Piece of

Conceptual Art–







Round two of the Lower Manhattan

Development Corporation’s effort to secure a

plan for the reconstruction of Ground Zero has

resulted in a “winner” from among six competitors,

a scheme set forth by European architect

Daniel Libeskind. Suitably pleased at his election,

Libeskind radiated awe and humility

across the front page of The New York Times,

almost forgetting, as if one could, the originating

causes of the commission. A brief review of

the six entries is included in section 9 of this

issue of Matters. A comprehensive presentation

of the Libeskind scheme and a broad set of

comments will appear in the Summer 2003


Distinguished principally by its approach to

remembering the more than 3000 victims of the

attack, the iconic element of Libeskind’s submission

was the preservation of a portion of the

enormous pit and adjoining slurry retention wall

that formed part of the foundation system for

the World Trade Center. The collapsing towers

created this pit. The gravity of the exposed pit

and the raw, ravaged wall goes to the heart of

the evocative reaction to the Libeskind scheme.

Libeskind’s authority in such a matter is reinforced

by his authorship of Berlin’s Jewish

Museum, essentially a spatial sculpture-cumbuilding

in memorial to Holocaust victims.

Support for the Libeskind scheme from pragmatic

perspectives came largely as a consequence

of its inclusion for rebuilding a considerable

proportion of the Trade Center's lost ten

million square feet of office space. Support

from New York’s cultural community came as a

consequence of the plan’s incorporation of an

array of “civic” uses. Support from New York

urbanists came as a consequence of its proposal

for building a tower 1776 feet high, which

would become again the tallest in Manhattan.

Despite all this, the issues of an adequate program

for rebuilding remain as forceful as ever:

• The process set out by the LMDC did not

address appropriately the economic issues of

rebuilding Ground Zero in regard to its integration

with either downtown’s or the city’s

economic future. The Libeskind plan cannot,

therefore, address the core problem: The

future of downtown Manhattan’s commercial

life and the balance between the commercial

lives of downtown and midtown. The

Libeskind plan envisions the civic rebuilding

as a necessary catalyst to commercial

rebuilding. This contention is unsupported and

probably unsupportable. Too much latitude

was given to design without a clearly thoughtout

program direction. It was as if the hard

issues were indeed too hard to deal with.

• But even the aesthetic merits of the Libeskind

plan, aside from the conception of the memorial,

and despite certain critical acclaim, are

weak. The ironic resemblance of much of the

urban design underpinnings of the scheme––

central space surrounded by medium to tall

towers––to the ill-fated Beyer Blinder Belle

proposals of round one has been noted. Why,

then, were the round one proposals so mercilessly

vilified while Libeskind’s entry so

embraced? Beyer Blinder Belle carried out

the LMDC instructions for round one precisely:

Focus on urban design issues as opposed

to architectural design; build the scheme

around a restoration of the office space. Was

it the assumption of the round one proposals

that office space would be at the core of the

rebuilding effort that aroused so much antagonistic


• The transportation infrastructure below grade,

which must be the primary focus of initial

action and which, from the perspective of the

future of the city, is more important than anything

that will happen above grade, has hardly

been discussed. It is on this issue that the

first and most crucial public monies will have

to be spent, and from these infrastructure

decisions all substantial future development

will spring.

This disregard of core issues taints the LMDC

process. It turns it, perhaps in retrospect not

surprisingly, into a political program invented to

parry forward two issues in the life of New York

politics: First, to create a public impression that

something indeed has been achieved, decisions

taken, a direction born. Second, to stake

out turfs in resolving the distribution of relative

powers among the governor of New York State,

the mayor of New York City, and the Port

Authority––meaning, here, the governor of New


Thus, round two is less about decisions, and

rather a continuation of an ongoing impasse:

• What does the Libeskind plan actually mean

from the perspective of a coming sequence of

budget expenditures and actions?

• What is the status of the Silverstein claim and

what does Larry Silverstein now wish to do?

• What does the leadership of the real estate

community really think?

• How much of the proposal can the economy

of the city actually support?

Lost in much of the focus on round two is an

effort, led by CUNY’s Lance Jay Brown, in association

with the New York Civic Alliance, to sort

out fundamental issues regarding downtown’s

future––in effect a continuation of much of the

past year’s discussions by a variety of New

York public and civic institutions. The

December workshop tested three propositions

about the future of lower Manhattan:

1. Downtown as the continued home of a New

York global office hub;

2. Downtown as a new home of a creative New

York civic/institutional hub;

3. Downtown as a liveable, if “ordinary” neighborhood

with a strong residential hub.

With each of these three propositions, the

implication of New York’s relations with the

region as a whole was reviewed.

Even if inadequate in its focus on the serious

economic issues driving New York's future, the

conference/workshop laid out precisely the

right questions. Why the press chose not to

give anything approaching adequate attention

to the workshop is beyond comprehension.

What is needed to move forward is a plan for

downtown, indeed for the city as a whole,

grounded in the realities of the enormous economic

holes facing New York. From such a

plan, the uses of public and private dollars may

emerge, with each complementary to the other.

But these are issues of great complexity,

requiring study and hard work. It is, sad to say,

easier to conduct a competition devolving into

pretty pictures rather than economic tables or

decision trees, easier to lay out clarion calls for

modernism and aesthetics than urban design

and architecture supportive of economic

growth and future prosperity.

We have allowed twenty months to pass since

9/11. The issues requiring deliberation have

given way to attempts at expediency, couched

in the toniest of tones.

The real voice of New York’s real estate and

civic leadership who knows that none of what

has been proposed can happen in the ways

presented to the public of New York as “conclusive”

is needed.

Leadership voices––capable of acknowledging

that, despite all the preoccupations, the most

important questions thus far have been

shelved––are imperative.




State of Real Estate:

New York City: Spring 2003

Welcome to "Market Matters" is a new

feature of Matters which will appear in

every issue of this quarterly bulletin. This

feature will seek to provide comprehensive,

unbiased coverage of issues that brokerage

firms typically are not comfortable discussing.

This first installment addresses the

weakening midtown office market and the

bubble in Manhattan condominium units.

Market analysis of the New York City real

estate market provides many challenges to

the analyst. New York City has one of the

most complex real estate markets in the

world with its highly regulated residential

market, its office market that dwarfs all

else in North America, and its public works

projects that are planned and constructed

over generations instead of years (i.e., the

Second Avenue subway). There are also

multiple competing data sources for each

product type and many more organizations

interpreting and repackaging the data to

argue their positions. Arriving at something

that resembles the true state of the

market is challenging, but the reward is

that one never runs out of topics to cover.

The long-term goal of "Market Matters" is

to be a resource to real estate professionals

who want coverage of the entire New

York City market and do not have the time

to read reports from different brokerage

services covering different product types.

The feature will provide both regular indicators

of the overall market's health and

will also investigate specific issues.


According to New York City's Office of

Management and Budget, the city lost

70,000 jobs in the wake of 9/11 and

132,000 jobs in the period from 4th Quarter,

2000 to 3rd Quarter, 2002. To put that in

perspective, for the month of November

2002 the national unemployment rate was

6 percent while the city's unemployment

rate remained stuck at 8 percent.

Additionally, many of the jobs that were

lost were high-wage financial services jobs

and as the average office worker in New

York uses approximately 250 sq. ft. (including

common areas), the job loss has strongly

affected the demand for office space.

The finances of the city also have been

affected and while it is unlikely it will face

a repeat of the 1975 fiscal crisis, it will be

at least a few years before the city is on

sound financial footing again.

According to Colliers ABR in December

2002, midtown's vacancy rate for Class A

office space was 9.8 percent and downtown's

vacancy rate for Class A office

space was 14.1 percent. There is an obvious

divergence in the relative health of

these two markets. Downtown used to be

considered as a serious alternative to midtown

when a company planned where to

base its headquarters. After 9/11, with the

damage to the transportation network and

the uncertainty surrounding the World

Trade Center site both in terms of what will

be built and when it will happen, few companies

are comfortable placing their headquarters


Downtown's high vacancy rate also implies

that the market does not see downtown as

New York's second CBD and rather sees it

as a secondary location much like Jersey

City. However, downtown has neither easy

access to the low cost labor that is essential

for back office operations nor sufficient

distance from the midtown CBD that it

could function reliably if midtown was

attacked with a weapon of mass destruction.

In today's New York, downtown is a

market without a clear purpose.

This is not to say that the midtown office

market is healthy. There is a glut of highquality

finished space that is available for

sublease. In fact, almost half of the space

available consists of sublease space and

not direct space. While landlords obviously

prefer to have subleased space in the portfolio

instead of vacant space (as the landlords

continue to receive rent from the tenant

on the over-lease), this sublease space

is a threat to the health of the market. The

sublease space drags down prices on direct

space as it is in competition with direct

space that is often in poor or unfinished


Partially as a result of this available sublease

space, the 1.2 million sq. ft. Times

Square Tower is still entirely vacant even

though Arthur Anderson terminated its




















lease at the end of June 2002 and has had

the other half of the building available

since pre-construction. Further east on

42nd Street is the CIBC tower at 300

Madison Avenue. It was announced in

January 2003 that CIBC World Markets Inc.

will take only 500,000 sq. ft. of the building

and will leave the owner, Brookfield

Properties Corporation, with 600,000

square feet of unfinished space. The construction

of both buildings should be completed

in 2003 and they will drop a total of

1.8 million sq. ft. of brand new Class A

space onto an already weak midtown

office market.

The ironic aspect of this story is that overbuilding

was not supposed to happen

again. The theory that was the rage in

1997 when REITs (Real Estate Investment

Trusts) were growing rapidly was that the

public markets were more efficient than

the private markets and this efficiency

would eliminate overbuilding. Both 300

Madison and Times Square Tower are

being built by publicly traded companies

(Brookfield Properties Corporation [NYSE:

BPO] and Boston Properties [NYSE: BXP]).

It appears that the public market is just as

efficient as the private market in miscalculating


As if an excess of high-quality sublease

space and overbuilding wasn't bad enough,

the situation became worse. "Shadow

space" is the unspoken fear of the office

market. Shadow space is space that is not

being utilized by the tenant but the tenant

is not marketing as available for sublease.

In New York today, there are companies

that have entire floors empty that they are

not marketing for sublease.

Companies may choose not to market their

available space for reasons including not












Note: This covers

Battery Park City to

116th on the West

Side and 96th Street

on the East Side.

Source: Miller Samuel

wanting to publicly admit that their business

is in trouble or not wanting to admit

to themselves that their downturn in

staffing needs could be long-term. Some

companies are unwilling to market their

available space because in order to manage

earnings they need to plan when they

take a write-down. There are several

financial services firms that had poor years

in 2002 and will now put their shadow

space on the market so that any writedowns

will occur in 2003 or later.

An example of the shadow space problem

is NASDAQ's recent admission that they

are not going to move operations to 1500

Broadway and will remain downtown.

What are they going to do with the 53,000

sq. ft. that they just signed a long-term

lease for last year? Will it go on the market?

In the meantime, their silence keeps

the available space rate at a lower number

than it truly is. The events of 9/11 provide

a window onto how bad the shadow space

problem can get. The brokerage community

expected that there would be a flood of

tenants in need of space. This was not the

case. While many of them shut down their

local operations, a good number of them

relocated to back office space or space

that they had emptied previously due to


Available space for sublease is much better

for the long-term health of the market

(and the market analyst) than shadow

space. Sublease space is public knowledge

and businesses can react effectively to this

information. Shadow space lies in wait,

ready to scuttle any recovery of the office


Regardless of the overhang of empty space

of all flavors and the specter of overbuilding,

some commentators have pointed to



















the relative strength of the investment

sales market as a sign that investors feel

that the office market is still healthy.

Unfortunately, for building owners, this is

more a reflection on the weakness of the

equities market and notably low interest

rates than any strength on the part of the

office market.


The US economy has been on a slow slide

and few feel ready to call the bottom. As

if it isn't bad enough, the stock market is

now down three years in a row, its worst

performance since the start of World War

II. Nonetheless, housing prices keep chugging

along and in New York City, which

has suffered significant blows to its major

industry, housing prices have hit historic

highs. Additionally, New York's prices are

far and away higher than the rest of the

country’s. According to a recent paper that

appeared in the Federal Reserve Bank of

New York's Economic Policy Review, housing

in New York City has risen greatly, relative

to the rest of the country over the

last 25 years. Of course, this needs to be

understood in the light of New York as a

global city. New York City is a veritable

bargain when compared to Tokyo.

According to a recent report by the

Economist Intelligence Unit, the cost of living

in New York is the greatest out of all

North American cities but it ranks only #11

in the world.

Living in New York is still financially challenging

for many residents. New York continues

to have a foreclosure rate that is

higher than the national average on

account of our high prices, continued

weakness in the job market, and well publicized

incidents of fraud and predatory

lending. Overall, the national foreclosure

rate has stayed stubbornly high and while










Note: This covers

Battery Park City to

116th on the West

Side and 96th Street

on the East Side.

Source: Miller


it showed signs of abating in the 3rd quarter,

it has not turned around significantly.

Specifically, the price per square foot for

Manhattan's condominiums reached a historic

high at the end of the 3rd Quarter of

2002, and 9/11 appears to not have

stopped the upward trend in prices. The

first warning sign of a possible turn in this

market will probably be a drop in sales volume.

To date, we have not seen that and

volume remains strong.

Measuring the price of condominiums

instead of cooperatives is the best indicator

of the health of the overall Manhattan

owner-occupied residential market. The

cooperative form of ownership plays less

of a role in the Manhattan housing market

than it used to. According to data compiled

by the Real Estate Board of New York that

came from the New York State Attorney

General's office, in the period from 1997 to

2001, plans were filed to build 11,161 condominium

units and only 1,408 cooperative

units. For new construction, and by extension

the future of Manhattan housing, the

condominium is emerging as the preferred

form of ownership.

One would expect that developers would

produce much more housing in response to

continued high prices and strong sales. As

others have noted, it's not easy to build in

New York City and so even as the market

has remained strong, the filings with the

Attorney General's office have remained

low and the number of building permits

issued for all housing, including rentals,

has remained level. Manhattan developers

are not overbuilding and this should cushion

the market from severe price drops

when the market does turn.

The other big issue concerning the rise in

housing prices is the role of interest rates.

While it has been noted that much of the

rise in national housing prices has been on

account of low interest rates, the average

interest rate on a 30-year fixed-rate mortgage

is now below 6 percent. It is unlikely

that prices could be inflated any further by

a drop in interest rates.


The next year will be tumultuous as the

office market comes to terms with a glut

of high-quality space and the residential

market deals with potential price drops.

The next installment will initiate coverage

on both the retail and hotel markets. It will

also follow up on changes in the office and

residential markets and continue to provide

charts of market indicators.


4 Educational


Newman Academic and

Certificate Programs

School of Public Affairs:

BS in Real Estate and

Metropolitan Development

The B.S. in Real Estate and Metropolitan

Development provides students with a

sound professional education linked to

marketable skills by offering a thorough,

practical and analytic grounding in critical

issues affecting real estate and metropolitan

development, with a major

focus on the New York area.

Offered through Baruch’s School of

Public Affairs with the support of the

Zicklin School of Business, this degree

program prepares undergraduates for

entry-level real estate careers in the private,

nonprofit and public sectors, in

firms and agencies that develop, manage,

finance, appraise and broker in

urban and suburban real estate markets,

as well as in organizations involved in

real estate policy. The curriculum combines

a comprehensive education in real

estate, with a broad-based foundation in

business, public affairs, and the arts and


Students are required to take courses in

appraisal, property management, real

estate law, real estate finance, a real

estate statistics and spread-sheet course

(including ARGUS), land use regulation

including zoning, housing, communication,

and a major year long capstone

course. The capstone courses (PAF 4701

and 4702) integrate prior course work in

real estate through the analysis of real

estate cases as well as the development

of each student’s own real estate development


The School of Public Affairs offers several

scholarships to incoming and current

students. Criteria for these merit-based

scholarships are academic achievement

and demonstrated commitment to public

service. Scholarships are generally

applied directly to tuition. Incoming students

do not need to complete additional

application materials to apply. Admitted

applicants are automatically considered

for any scholarship funding available.

Scholarship applications for continuing

students that qualify will be notified of

application availability via mail.

Zicklin School of Business:

BBA Minor

in Real Estate

Baruch undergraduates receive a nationally

renowned, well-rounded business education.

The real estate minor consists of a

four-course sequence including transactional

law and finance that provides students

with a solid real estate industry


Undergraduate Real Estate Courses at

the Zicklin School of Business

Real Estate Valuation and Appraisal

REA 3702

Real Estate Management

REA 3710

Financing Real Estate and Metropolitan


REA 4725

The Law of Real Estate Transactions I

LAW 3301

The Law of Real Estate Transactions II

LAW 3302

The Law of Real Estate Finance

LAW 3303

Zicklin School of Business:

MBA Concentration

in Real Estate

The Zicklin School of Business now offers

a commercial real estate concentration

within the General MBA option. The threecourse

sequence includes core courses in

real estate finance, urban economics, and

transactional law. A good fit for those

seeking an entrepreneurial real estate

career or positions in the real estate

finance sector, the concentration complements

other areas of the Zicklin graduate

business curriculum.

Graduate Real Estate Courses

at the Zicklin School of Business

Law of Real Estate Transactions

and Land Use Regulation

LAW 9790

Urban Economic Development

PAF 9136

Real Estate and Finance

and Capital Markets

REA 9795

The Newman Institute

Certificate Program

at Baruch College

The Certificate Program, offered in conjunction

with the Baruch College Division

of Continuing and Professional Studies,

continues to grow. The spring semester

continues with the following courses:

An Overview of the Real Estate Profession

NCP 1000 F/Sat, Apr 25–May 3,


The Changing Dynamics of Real Estate

NCP 2000 T/Th, Apr 1, 3, 8, 10, 15, 17, 22,


Real Estate Financial Analysis (II)

NCP 5000 TR68 T/Th, Apr 24–May 21,


Real Estate Law

NCP 7000 T/Th, Apr 15–May 15,

6:00– 8:30pm

ARGUS Real Estate Financial

Analysis Software

NCP EL 05 M/W, Apr 21, 23, 28, 30


Basic Real Estate Investment

NCP EL 11 M/W, Apr 7, 9, 14, 16,


Developing New York’s Brownfields

for Communities

NCP EL 14/20 M/W, May 5, 7, 12, 14, 19,

21, 6:00– 9:45pm

Introduction to Design and

Construction in New York

NCP EL 24 M/W, Apr 21–May 7,


Retail Real Estate

NCP EL 25 M/W, Apr 7, 9, 14, 16,


Landlord-Tenant Relations and Law

NCP EL 30 M/W, Apr 21, 23, 28, 30,


Real Estate Writing (II)

NCP EL 95B Mondays, Apr 21–May 19,


Residential Appraisal II

(Course 120–Appraisal Procedures)

NCP APR2 M/W, Apr 21–May 21,


Fair Housing, Fair Lending and

Environmental Issues

(Appraiser Qualification- AQ1)

NCP AQ1 Sat/ Sun, Apr 12, 13,


New Real Estate Appraisal Program

In conjunction with the Metropolitan

New York Chapter of the Appraisal

Institute, a new real estate appraisal program

is being offered this spring as part

of the Newman Institute Real Estate

Certificate Program. The program consists

of the full sequence of courses in

real estate valuation that is required to

become a licensed real estate appraiser

in the State of New York, as well as to

obtain a Baruch/Newman Institute

Certificate in Real Estate Appraisal.

Four courses will be offered in the spring

semester. The new appraisal concentration

in the Certificate Program marks a

major expansion for the Newman Real

Estate Certificate Program, providing a

new, highly professional and well recognized

series of courses in real estate valuation

and appraisal.

The new joint program will be the educational

home for the Metropolitan New

York Chapter of the Appraisal Institute,

allowing for an expanded offering of

courses leading to the highly respected

MAI designation.

A Joint Newman Institute-

Hunter Urban Planning

Certificate in Housing and

Community Development

The Newman Institute has begun working

with the Department of Urban Planning

program at Hunter College to provide

new course offerings leading to a new

joint Newman/Baruch-Hunter Certificate

in Housing and Community Development.

This program will combine both real

estate and urban planning aspects of the

housing and community development

processes in New York, focusing on the

needs of the city’s wide array of community

housing and development organizations

and the government agencies that

much of their projects engage.


This spring the Newman Institute will

also offer a new six-session seminar

course on developing affordable housing

on New York’s often environmentally

challenged sites. An agreement between

the Newman Real Estate Institute and

the Local Initiatives Support Corporation

(LISC) will provide that those who are

affiliated with any LISC-supported nonprofit

organizations may be eligible for

special scholarships for this new course.

As part of the Newman Institute’s Real

Estate Certificate Program, this new

course, NCP EL 24, will be offered on

Monday and Wednesday evenings, May

5, 7, 12, 14, 19 and 21.

5 Matters



Newman Institute


Midtown-West: Manhattan’s Future

Day Two

May 30, 2003

Part Two of Midtown-West: Manhattan’s

Future, a comprehensive three-part conference

and exhibition on the development

of 21st-century midtown, will feature

the ideas developed by four specially

commissioned academic-professional

teams. To complement the work

organized by the Department of City

Planning, the Newman Institute has

invited each academic team—from the

architecture and urban design programs

of Harvard, Princeton, Columbia, and the

City University of New York—joined by

leading New York professional architectural

planning firms and leading members

of the New York land-use bar to

prepare specific land use, zoning, and

urban design suggestions for public consideration

and review.

In addition, special presentations will

also be made by The Architectural

League and the Cityscape Institute.

China’s Emerging Global Cities:


June 3-4, 2003

The Steven L. Newman Real Estate

Institute this spring introduces a new

conference series entitled “Global

Cities: Complement/Competition for

New York City Real Estate.” The series

will explore the ways in which global

cities establish and sustain economic

hegemony in the digitalized global economy,

urban qualities that go beyond

function, and the increasing preeminence

of regions. The first installment in

this series is the US-China Real Estate

Summit, which will focus on Beijing and

Shanghai as China’s emerging global


As Shanghai approaches 2008, when it

will host the Summer Olympics, it is

transforming itself into a world city.

Local and national politicians must

ensure that the city’s infrastructure, as

well as its political atmosphere, can

accommodate an influx of athletes, officials

and spectators of an unprecedented

magnitude and diversity.

Such an effort places in high relief the

Chinese government’s efforts, particularly

in Shanghai and similarly in Beijing,

to integrate its non-democratic, noncapitalist

system into the global economy.

With the cooperation of the Chinese

Embassy and the Chinese Consulate,

this conference will explore China’s tenuous

position, and its potential payoff,

as it plays out in Shanghai and Beijing.


New York Futures:


September 12, 2003

The second annual City University Urban

Consortium Seminar, “New York

Futures: City/Region/Global,” will

explore the causal relationship between

economic development and urban development

with a global city’s metropolitan

area, and with each other.

Research from Columbia and Harvard

universities suggests that global cities

are remarkably resilient entities. London

and Jerusalem, for example, have

bounced back from terrorist attacks;

both have retained their populations.

Using these and other examples, the

seminar will attempt an explanation of

the unique characteristics of a city’s

employ that allows it to persist through

the centuries.

Historical context cannot perfectly predict

the future, however, because many

cities are now facing a threshold in

evolution. Population trends, political

reconstitution and cultural renaissance

are placing unprecedented pressures on

the seams that bind the world’s cities.

New York City exemplifies some of

these conflicts, and the New York Real

Estate Forum’s 2003 Finance Conference

will anticipate these and alternative

realities in order to assess the city’s

historical resilience within these competing


The First Newman/CUNY Fellow

Elizabeth A. Roistacher has been named

the first CUNY/Newman Urban Fellow,

in cooperation with the City University

Urban Consortium. A breakfast symposium

on rent regulation and taxation,

and their impact on the housing structure

of New York, will be held on June

10 in honor of the inaugural Newman

Fellow in a new annual program.

Dr. Roistacher is a founding member of

the Urban Consortium and is professor

of economics at Queens College and the

Graduate School of the City University

of New York, and a member of the

CUNY/Newman Institute Urban

Consortium. She has written numerous

articles on housing and urban policy and

is co-author of Tax Subsidies and

Housing Investment and co-editor of

Rental Housing: Is There a Crisis?

Consortium Postings

Lance Jay Brown, chair of CUNY’s

School of Architecture, Urban Design

and Landscape Architecture, has been

awarded ACSA (American Collegiate

Schools of Architecture) Distinguished

Professor. He was also recently named

a Fellow of the American Institute of



April 2003


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CUNY Institute for Urban Systems/Newman Real Estate Institute:

Breakfast Program

Moving East: Second Avenue Now?

Building the Second Avenue Subway Line:

Options, Costs and Benefits

Thursday, April 10, 2003




May 2003


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25 26 27 28 29 30 31

CUNY Institute for Urban Systems/ Newman Real Estate Institute:

Designing for Securities

The National Arts Club, 6:00–8:00pm

Wednesday, May 14, 2003

CUNY Institute for Urban Systems/Newman Real Estate Institute:

Breakfast Program

Moving West: Do We Really Need New Rail?

Extending the Number 7 Line: Options, Costs and Benefits

Friday, May 16, 2003

The New York Real Estate Forum

The 2003 Development Conference:

Midtown-West: Manhattan’s Future

Day Two: Ideas & Issues: Midtown-West

Friday, May 30, 2003

June 2003


1 2 3 4 5 6 7

8 9 10 11 12 13 14

15 16 17 18 19 20 21

22 23 24 25 26 27 28

29 30

The US-China Real Estate Summit

3-4 The New York Real Estate Forum

The Global Cities Conference:

China’s Emerging Global Cities: Beijing/China

Tuesday and Wednesday, June 3-4, 2003




The CUNY/Newman Institute Urban Consortium

Announcing the appointment of the inaugural CUNY/Newman Institute

Urban Fellow: Elizabeth Roistacher

Tuesday, June 10, 2003

The City Roundtable:

Jersey City: New York’s Sixth Borough?

Day One

Friday, June 13, 2003

The City Roundtable:

Jersey City: New York’s Sixth Borough?

Day Two

Friday, June 20, 2003



Rebuilding: Midtown-West



At the turn of the 20th century, the city

buried the rail yards north of Grand

Central Terminal beneath a grid of

streets and building sites, creating a

grand boulevard––Park Avenue––that

became the heart of the midtown business

district. Almost one hundred years

later, city officials hope that building a

platform atop another rail yard, this time

on the far west side of Manhattan, will

create an enhanced commercial and residential

center in the 21st century.

At a hearing on February 10, the

Department of City Planning unveiled

the outline of its plan to promote the

growth of Midtown-West over the next

40 years. As envisioned by planners, the

Hudson Yards area would feature a mix

of commercial and residential buildings,

with a large concentration of office towers

on its western edge and open space,

along with new streets, a stadium and

an expanded Javits Center, all served by

a subway extension.

Amanda Burden, the director of City

Planning, told an overflow crowd at the

Javits Center that the goal is to turn the

area stretching from 24th to 43rd

Streets and Eighth Avenue to the

Hudson River from a hodgepodge of

body shops, tenements, under-used

industrial buildings and empty lots into

a "vast and dynamic district" that would

help retain jobs by giving midtown room

to grow. "We want to create a very special

place where people want to live,

work, visit and spend time," she said.

As envisioned by the city, Hudson Yards

would develop gradually, with the entire

district built out by around 2040. The

city would set the stage for development

with transportation and other

infrastructure improvements, among

them a controversial stadium atop a platform

over the West Side rail yards that

would house the New York Jets, the

2012 Olympics and perhaps serve as a

replacement for Madison Square Garden.

A new ferry terminal at 38th Street and

the Hudson River is already under construction

and is scheduled to open in

2004. Also planned are the renovation of

the Postal Service's Farley Building as a

new Pennsylvania Station by 2007; an

extension of the Flushing IRT (the No. 7

line) from Times Square to the vicinity of

33rd Street and Eleventh Avenue by 2009

and the expansion of the Javits Center

northward by 2010. Planners also envision

moving certain city facilities, such as

the tow pound now located on Pier 76, to

less obtrusive sites, among them spaces

beneath the proposed stadium.

Once the infrastructure is in place, making

the neighborhood more accessible,

the city expects a mix of uses to develop,

encouraged by zoning changes in areas

that are now reserved for manufacturing.

Housing would be scattered throughout

Midtown-West, with concentrations in

existing buildings on Ninth Avenue and in

new buildings along Tenth. Loft-style

housing would be encouraged in warehouse

buildings between 28th and 30th

Streets. Large office buildings and retail

would rise along Eleventh Avenue opposite

the Javits Center and in the southern

portion of the area near 34th Street.

Two new north-south thoroughfares

would aid circulation through the area

and provide open space in a district that

currently has almost none. One of the

new corridors, with northbound and

southbound streets separated by a green

mall, would run between Tenth and

Eleventh Avenues over what is now an

open railroad cut. The other would consist

of a series of small mid-block squares over

and around the sunken approach road to

the Lincoln Tunnel, with paths and footbridges

linking them.

Other public spaces would include outdoor

athletic facilities near the stadium, a green

buffer next to the stadium to give it a "soft

edge," a square about the size of Bryant

Park in the southern portion of the neighborhood,

a waterfront park that would tie the

Javits Center to the river and public access

to the Hudson through the expanded convention

center at 39th Street. Some sidewalks

would be widened and street trees

would be planted extensively.

Guy Battle, a consultant who worked with

the City Planning Department on environmental

concerns, noted that orienting much

of the open space in a north-south direction

between buildings would block some

of the cold winds from the river while maximizing

sunlight. The new open spaces and

corridors would also help disperse pollutants

from the Lincoln Tunnel approaches.

The city hopes to preserve the character of

Ninth Avenue, with its mix of ethnic food

shops, relatively low-rise housing and lively

pedestrian traffic, while encouraging dense,

mixed-use development farther west. Even

before details of the plan were unveiled,

community groups in Hell’s Kitchen were

critical, saying the arrival of large office

buildings and new apartments will drive up

rents and gentrify their neighborhood.

At the hearing, the plan drew a mixed

response. A large contingent of union

workers from the Javits Center and the

building trades were present to demonstrate

their support for the proposal

because it would create jobs. The unions

and representatives of the tourism industry

called for going ahead with the Javits

Center expansion immediately, noting that

the current facility is undersized and loses

many large trade shows to other cities.

Residents and elected representatives of

Hell's Kitchen and Chelsea, however,

questioned the appropriateness of a stadium

in Manhattan and said that the dense

office development envisioned along

Eleventh Avenue and elsewhere would

destroy the Midtown-West’s low-rise,

mixed-income character. Some speakers

said they wanted to see more affordable

housing and less dense development.

"We don’t want to be another midtown,"

said Councilwoman Christine Quinn, a

Democrat who represents the area.

Jocelyn Jacobson, representing

Manhattan Borough President C. Virginia

Fields, said the financing plan, which

would use tax increment financing (TIF) to

pay for the platform over the train yards

and other improvements, "raises serious

questions." Under tax increment financing,

the city pays for improvements using revenues

generated when those improvements

drive up the assessed value of

nearby property. If values do not rise

quickly enough, however, the city would

have to use other funds to pay off the

bonds issued to fund improvements.

Planners said they hope to have the

design and zoning proposals finished in

the spring with a draft environmental

impact statement ready a year later.

Zoning changes could be adopted in the

fall of 2004 or the winter of 2005 and subway

construction could, optimistically,

start in spring 2005.



The New York City

Department of City

Planning’s vision for

the growth of

Midtown-West features

a mix of commercial

and residential

buildings. The

Hudson Yards area

would develop gradually––with

the entire

district built out by

around 2040.


Two new north-south

thoroughfares are

meant to aid circulation

through the area and

provide open space. One

of the new corridors

would run between

Tenth and Eleventh

Avenues. The other

would consist of a

series of mid-block

squares over and around

the sunken approach

road to Lincoln Tunnel,

with paths and footbridges

linking them.





Jersey City:

Borough Six?

The ferry from Staten Island is telling: There

is a moment where you are truly confused.

Skyscrapers lining the riverfront are suggestive

of Manhattan––but they are on the

wrong side.

That is, of course, Jersey City, the new

Jersey City, the Jersey City coast, a rapidly

emerging new urban side of the harbor. But

how did it get there and how did it get so big

so quickly, and why does it look bigger than

downtown Brooklyn, and why, most of all,

will it get bigger and should New York care?

The table and maps below outline part of

the story. Beginning in the mid-1980s at

Exchange Place in Jersey City, around the

PATH station of the same name, a string of

developments were begun, led by New

Jersey banks and financial institutions and

then followed by Wall Street financial eminences.

These commercial developments

transformed the work contexts for both the

Jersey City and downtown Manhattan office

districts: What began as a cheaper source of

“backoffice” space evolved to a new series

of Class A office towers and emerged serving

both New Jersey companies with no

interest in moving into Manhattan, and more

ominously for New York, major New York

businesses who see Jersey City as a host for

far more than backoffice uses. Witness: the

scale and intended occupancies of Goldman

Sachs tower now under construction: A new

“vertical campus” for Goldman, one of two

towers which they may build, ultimately.

Linked to these commercial developments was the

sale and transformation of the famous Colgate

complex of loft structures. Many old Colgate

buildings were transformed into housing. This

spurred other new and rehabilitated residential

projects along blocks adjacent to the waterfront.

Do Manhattan and Jersey City futures converge

or compete? For Jersey City, questions concerning

their future center on whether this gold coast

strip of development can be brought inward to

affect development in the rest of the city. For

New York, and downtown Manhattan in particular,

the question is whether the financial district

will be organized as an integral relationship

between the two cities, with complementary

uses supporting enhanced growth of both sides,

or whether the development of Jersey City will

assume a competitive life of its own and, for various

reasons––mass-transit and vehicular

access, tax policies, cost of operations––outpace

or replace downtown Manhattan.

These questions, among others regarding retail

and residential uses, will be explored in the

2003 New York Real Estate Forum City

Roundtable, dedicated to the theme ”Jersey City:

New York’s Sixth Borough?“ The questions posed

are: To what extent will the growth of Jersey

City be complementary or competitive to

Manhattan? And, why hasn’t downtown

Brooklyn shared in the same pace of growth? Is

New York tax policy in comparison to New

Jersey’s at the root of this? Or is the fact that

Jersey City sits on the other side of the Hudson

River the root?

Jersey City Recently Completed Development Projects

Project Name Type DU/Rooms Office Retail Parking

New Town Houses residential 8 - - 4

Gotham residential 220 - 18,438 328

The Legacy at Liberty Park residential 324 - - 359

Sugar House residential 74 - 1,080 67

72-78 Morris Street residential 19 - - 10

70 Hudson–Hartz commercial - 357,866 - 273

90 Hudson–Hartz commercial - 371,728 - 285

95 Green Street–SJP commercial - 261,184 8,146 128

Hyatt Hotel commercial 350 - 19,000 0

Harborside Plaza 4A commercial - 170,000 25,000 1,100

Harborside Plaza 5 commercial - 817,500 8,500 1,258

321-333 Washington commercial - 40,000 - 0

Harborside Plaza 10 commercial - 518,578 13,482 367

Project Name Type DU/Rooms Office Retail Parking

Candlewood Hotel commercial 215 - - 133

Portofino residential 283 - 4,800 299

Double Tree Hotel commercial 200 - - 187

Noc III commercial - 547,795 12,000 750

South Hampton Apt Tower residential 409 - 4,239 269

Marriott Courtyard Hotel commercial 189 - - 79

Noc IV commercial - 858,135 11,318 653

Noc V commercial - 704,510 15,584 723

Noc VI commercial - 293,430 16,637 207

Modells/Office Max commercial - - 40,946 183

Lincoln residential 153 - - -

Subtotal 2,444 4,940,726 199,170 7,662


tubes linking


City to


and lower



The gold coast

pattern of

Jersey City







Big Brooklyn Box:


Big-box stories tend to sound the same.

Following the initial shock of something/anything

unusual appearing on the

horizon, there are a handful of the usual

issues: for and against disrupting a

neighborhood with increased traffic;

resistance to a building type that is perceived

as anti-urban, vs. the convenience

and choice and economic benefits of a

large office supply or book/music/café.

For IKEA, though, the by-product of the

business formula it established and the

resulting good will it has carefully cultivated,

may be leading to a far less controversial

process. Jesse Masyr, landuse

attorney and partner in the

Manhattan law firm Wachtel & Masyr

had been assisting IKEA in the establishment

of a new facility in the Red

Hook section of Brooklyn. And he

believes that the distance people will

travel to get to an IKEA––such as from

Brooklyn to a store on a far-off highway

in Elizabeth, New Jersey––is an

endorsement that probably is not available

to other big-box retailers. Helpful

also in this case is that IKEA’s Elizabeth,

NJ store is its #1 performing store in

the United States and the largest customer

base for that store is, reportedly,

from Brooklyn.

Masyr, whose firm has “handled the

arrival of every Home Depot in New

York,” describes the potential arrival of

IKEA as exponentially more peaceful.

New Yorkers, he said, who have shown

a surprising willingness to travel to

Elizabeth, NJ for IKEA’s home furnishings

(“No one,” Jesse Masyr points out

even though both are his clients “would

swim that far upstream to go to a Home

Depot.”) were expected to be, and were,

less likely to object to the insertion of a

new IKEA in Red Hook. If this store is

built on the designated two-millionsquare-foot

site (a site owned by a former

ship repair business with existing warehouse

space still on it), comparable in

size to Macy’s on 34th Street, it may

serve as proof of the axiom that customer

goodwill is like money in the bank.

Elements that were used to guide this

project to acceptance were various and

inventive. IKEA, for example, plans to

invest in its own NY Waterways ferry

that would run across the East River from

Pier 11 (at Wall Street) to Red Hook and

back on the weekends––without any

requirement for shopping at IKEA. Masyr

says IKEA will run shuttle buses from subway

stations in Brooklyn to its new Red

Hook store with the buses serving as

“moving billboards.” Businesses serving

IKEA customers, including restaurants and

parking might expect to benefit from a

temporarily captive population.

This is NYC and it is not conceivable that

there would not be some neighborhood

opposition to the insertion of big-box retail

in a residential area even if the 28 percent

unemployment rate is frightening. Red

Hook has been discovered by artists who

have seized upon the available warehouse

space in a city that has less and less of

such environments. Their proprietary interest

is not hard to understand.

Displacement is always an issue in such

cases. As is the issue of where the next

frontier might be. And yet disparity of

scale may turn out to be a new condition

of life from city to suburb.


New Yorkers,

who have

shown a surprising


to travel to

Elizabeth, New

Jersey, for

IKEA’s home furnishings,


less likely to

object to the

insertion of the

big-box retailer

in the Red Hook

section of





Ground Zero Update:



In December 2002 the Civic Alliance presented a

design workshop, led by Professor Lance Jay Brown,

Chair of the City College Architecture School, that

examined three different alternative futures for

lower Manhattan. The workshop, which was held in

an open storefront near South Street Seaport, included

many well-known planners, architects and urbanists

who volunteered their efforts to explore visions

beyond the sixteen acres of Ground Zero.

Three alternative concepts for lower Manhattan

were advanced:

1) continuation as the world’s financial center but

utilizing potential sites in transportation catchment

areas throughout downtown;

2) constellation of “creative hubs,” using older as

well as new buildings and providing an expanded

range of amenities and economic activities;

3) opportunity for an expanded group of diverse, livable

residential communities. Workshop participants

were able to identify major themes: key

public investments in infrastructure and amenities,

neighborhood connections, downtown’s

opportunity sites, and sustainability, while leaving

the World Trade Center site more, but not

entirely, for civic and public uses.

This process and its work product framed an

approach to redevelopment systematically different

from the approaches to both process and product

adopted by the Lower Manhattan Development



The planning






In February 2003, the Lower Manhattan Development

Corporation announced the selection of the design of

Daniel Libeskind as the winner among a second-phase

competition for the master redevelopment plan for the

World Trade Center site. The seven second-phase

entrants are pictured below. (The original first-phase

designs were presented in the autumn 2002 issue of

Matters.) They will be reviewed, along with a complete

presentation of the Libeskind scheme, in the

summer issue of Matters. An editorial on this subject

appears elsewhere in this issue.


Foster &












on the


of the
















on neighborhoods




and Urban


Team of


Meier &





Siegal &


Steven Holl




10 Archival


“The World’s Largest

Piece of Conceptual

Art – WTC”

Reprinted from “atelier”, Tokyo, June 1993

On February 26, residents of New York City

watched in horror as cable television and the

one network station that was still able to

broadcast delivered images that previously

had been unimaginable: smoke pouring from

the 100-story twin towers of the World Trade

Center – the city’s tallest structure and one

of its icons – and glimpses of some of the

50,000 persons who worked in those buildings

and who had struggled down 60, 70,

even 100 flights of stairs in smoke-filled

blackness in the aftermath of a tremendous

explosion, when all backup safety and communications

systems had failed. Traffic was

completely disrupted in Lower Manhattan,

and also on New Jersey highways and the

bridges and tunnels that connect the two

states, as additional ambulances sped in to

help the 1,000 persons that had been injured.

At first there was speculation about infrastructure

failure as the cause (a boiler

exploding, or something like that) – which

would not have been surprising in a city

where infrastructure generally is treated as

an afterthought. But the size of the crater

that was found in the underground parking

garage – directly under the adjacent Vista

Hotel rather than the towers themselves –

turned out to be 200 feet long and 70 feet

wide, which meant explosives have been

used. Additional horror was caused by the

realization of how easy it had been to disrupt

the entire financial district; it had taken about

$400 worth of materials, a do-it-yourself

method of assembly, and then lax security at

the garage. What had been accomplished,

according to law enforcement officials, was

“the most destructive act of terrorism on

American soil.”

The thought of 50,000 persons trying to

escape from a fire, all at once, anywhere, is

frightening enough. But watching them try to

escape from a tall building – from the skymade

many residents of the city feel even

more vulnerable. And besides the arrival of

international terrorism in a place where it

had not been a daily concern, and where

there still is curbside check-in at the major

airports, questions about tall buildings took

on greater urgency.

There is hardly a better city than New York in

which to consider the skyscraper. It is here

that the competition for the tallest tower on

earth has been conducted in earnest. The

Metropolitan Life, Woolworth and Chrysler

buildings have all held the record. The

Empire State Building captured it in 1931 and

held it for almost forty years – until, in 1970,

the startling World Trade Center designed by

Minoru Yamasaki was completed.

These identical rectilinear towers of

immense height were built by the government

as a reinforcing symbol of New York’s

dominance in world commerce. But unlike

the romantic and decorative towers of the

past which usually were associated with a

particular company, Yamasaki’s towers rose

seamless, minimal and flat and gave away

nothing about their purpose or who their

occupants might be. Status value resided

only in size and technology. (It is now

thought that these factors may have made

them especially attractive to terrorists, who

like some ambiguity). The State of New York

has, in fact, been the major tenant among

400 international businesses and government

and trade missions, and the principal

foreign tenants have been Japanese companies.

The World Trade Center had only a brief victory

in the height race, though. Just months

after it officially opened, the Sears Tower in

Chicago was completed and became – and

still is – the world’s tallest building. But the

World Trade Center still manages to hold its

own as an international icon because it has

two; it can be referred to as the world’s

tallest twins. And one could say that Minoru

Yamasaki created the world’s largest piece of

conceptual art.

Although the towers were hailed as technological

wonders when they were completed,

Yamasaki chose not to provide a reassuring

visual sense of solidity. Instead, he merged

every three of WTC’s steel columns into one

as they neared the ground, so that these

enormous buildings appear – eerily- to be

resting on delicate and widely spaced

columns. His floor-to-ceiling windows also

made some tenants nervous. And among

architects, a story circulates that, determined

to prove the windows were not a safety hazard,

Yamasaki went up to a very high floor

and, in front of witnesses, hurled his body

against one of the glass panes. The sight of

terrified, suffocating people trying to break

those windows two decades later raised

chilling questions about concepts of safety.

Completed during an energy crisis, the WTC

also was immediately, if not widely, recognized

as an environmental disaster: an energy-intensive

structure using as much electricity

per day as a city of 100,000 inhabitants.

But, along with questions about terrorism

that have arisen, from time to time, over the

years, environmental concerns have been

obscured by the drive to maximize profits on

expensive urban sites – which is what skyscrapers

are essentially about.

Now, though, as thought occurs about what

would have happened if the explosives had

been under one of the towers and whether

anyone would want to be on the 80 th floors

of any building when disaster strikes, there is

an opportunity for some reassessment.

Parking facilities under buildings are a fact of

life: in terms of finance and urbanism, there

is no other place to put them. Architects can

design for seismic contingencies. They also

can design buildings that are like fortresses.

Do we want them to? Can safe and environmentally

responsible office buildings become

the new status symbols? These are some of

the questions that will help us define the

urban landscape of the 21 st century.


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