NEW YORK | Critics wrong on Hudson Yards

[NYguy]

https://therealdeal.com/new-york/?p=804785

Lander on Hudson Yards: “I got it wrong”
Comptroller admits development producing more tax revenue than expected





JUN 20, 2023
By Erik Engquist

By Erik Engquist
Hudson Yards has for years been a punching bag for progressives. They called it a giveaway to Big Real Estate, a bad risk for taxpayers and a billionaires’ playground. When the pandemic set the project back, they called it karma.

So it was surprising, even shocking, when City Comptroller Brad Lander — successor to Bill de Blasio as the city’s top elected progressive — openly admitted the Bloomberg administration was right about Hudson Yards’ public financing scheme.

It’s not just working, but working better than anticipated — even after the development was slammed by Covid.

“One really interesting thing we looked at this month, in the Class A, in the trophy parts of the market, things are actually really rebounding well,” he said on NY1. “Hudson Yards is giving about $200 million more a year than we expected, and that’s going to grow to $300 million.”

The interviewer, Errol Louis, a veteran of city politics and a former candidate himself, did not miss the significance of Lander’s statement. A couple of minutes later, he returned to the subject.

“You had been a skeptic of the financing of Hudson Yards,” Louis noted.

The city issued bonds to pay for billions of dollars’ worth of infrastructure, notably an extension of the No. 7 line, to make the massive development possible. Bondholders would be paid back by the resulting increase in property tax revenue, Doctoroff promised. If revenue fell short, city taxpayers would be on the hook.

Lander was one of the voices on the left who openly questioned the administration’s financial alchemy. But after looking at the numbers — which, as comptroller, is his job — he has come around. All the way around.

”I own this,” Lander said. “You know, one thing you try to do in the comptroller’s office is collect the data and have it test your priors. In this case, I was a critic of the Bloomberg administration’s financing scenario. They basically used the city’s credit card to finance Hudson Yards and put the city at risk, and I and others raised concerns that it would expose the city.”

“As it has played out, Hudson Yards is financing that debt and now returning, again, a couple hundred million dollars more to the city than we expected,” the Park Slope Democrat said. “So this is one place I gotta say I got it wrong.”

Subways, pedestrian improvements and parks are things that government is supposed to pay for. No one thinks of Central Park as a subsidy for Billionaires’ Row, Prospect Park as a handout for Brooklyn property owners or Grand Central Terminal as welfare for Midtown.

Another fact long forgotten is that the Related Companies only got to develop Hudson Yards because Tishman Speyer pulled out, deeming it too risky in the wake of the Financial Crisis. If Related got a “sweetheart deal,” it’s worth asking why a rival developer turned it down.

….. “The data has helped me see some changes there,” Lander said on NY1. “Still some questions about the architecture, I guess, but on the financing, at an important moment for the city, it’s making a big difference.”

[Antares41]

So the real question now is what was the lesson learned? How do they rework the model to determine successful development? What criteria is being overlook? and, what egos need to be put in check to allow for a truly objective analysis?

[Gantz]

Originally Posted by Antares41

So the real question now is what was the lesson learned? How do they rework the model to determine successful development? What criteria is being overlook? and, what egos need to be put in check to allow for a truly objective analysis?

Lessons learned: investing in subway infrastructure coupled with upzoning to open up new areas for commercial private development, thus increasing tax base revenue is good, despite the shadows cast on an urban tomato garden that NIMBYs care about. Billions in revenue and a new neighborhood vs a few dead tomato plants.

[C.]

Originally Posted by Gantz

Lessons learned: investing in subway infrastructure coupled with upzoning to open up new areas for commercial private development, thus increasing tax base revenue is good, despite the shadows cast on an urban tomato garden that NIMBYs care about. Billions in revenue and a new neighborhood vs a few dead tomato plants.

What he said.

I do wonder if more of these types of developments happen as we’re in a major housing crisis and there is a need to increase revenue as Federal pandemic funds run out. NIMBY’s be damned.

[Busy Bee]

Originally Posted by Gantz

Lessons learned: investing in subway infrastructure coupled with upzoning to open up new areas for commercial private development, thus increasing tax base revenue is good, despite the shadows cast on an urban tomato garden that NIMBYs care about. Billions in revenue and a new neighborhood vs a few dead tomato plants.

Excellent.