Preservation Issues

Midtown East Rezoning Passes

-Grand Central Terminal

-1925 Postum Building at 250 Park Avenue

-Hotel Intercontinental - 111 E. 48th Street

Update: August 2017

The future of Midtown East is bigger and taller buildings as the City Council voted on August 9 to approve the area’s rezoning. The final version of the proposal contained several modifications that had been revealed at a Council Subcommittee hearing in July, including a reduction of the minimum contribution assessment on any transfer of development rights from landmarks, from $78.60/sq. ft. to $61.49. Funds from those assessments are set to go toward public realm improvements.

The vote came at the end of a lengthy process which resulted in 12 new landmarks across the area. We will continue to campaign for additional designations.

July 2017

The City Council voted unanimously to approve the Midtown East zoning proposal at a July 27 hearing of the Subcommittee on Zoning and Franchises. The proposal encourages construction of large commercial office towers in the area around Grand Central Terminal (39th to 57th Streets, Madison to Third Avenues) without additional public review. It also provides new opportunities for landmarks to transfer their unused development rights within the entire area. But it assesses each transaction at a cost of 20% of the sales price or $61.49 per square foot, whichever is higher. The money will go toward public realm improvements.

The Conservancy had urged the Council to do away with the minimum contribution amount, which will decrease funds available for restoration and maintenance of landmark buildings. In the end, the Council lowered the minimum contribution from $78.60, based on a new analysis of air rights sales.

This vote comes at the end of a lengthy process. Councilmember Daniel Garodnick and Manhattan Borough President Gale Brewer co-chaired a Steering Committee that looked at rezoning Midtown East and issued a series of recommendations in 2015, following the collapse of an earlier plan under the Bloomberg Administration. As a member of the Steering Committee, the Conservancy pushed for designation of new Midtown East landmarks; 12 were designated in late 2016 and affirmed by the Council this year. We appreciate the work of the Landmarks Commission and Council in completing this work before the official public review of the rezoning. We hope that the Commission will continue to consider designation of significant historic architecture that will face new development pressure with the rezoning. Unprotected buildings that we called for designation include the Postum Building and Hotel Intercontinental. The Department of City Planning has tagged these among 16 projected development sites.

In addition to lowering the minimum contribution, the Council voted on the proposal with commitments from City Hall to make some other adjustments. The non-mayoral appointed members of the group that will govern the public realm improvement fund will have more authority; the City is providing starting funds to improve open spaces; parts of the east side of Third Avenue were removed; and new buildings will be required to have some public space. The full Council still has to approve the proposal but the subcommittee vote ensures that it will.

Defending Midtown East Landmarks From Unfair City Proposal
APRIL 2017

Protection of Midtown East landmarks was the focus of the Conservancy’s testimony at an April 26 City Planning Commission hearing on a proposed rezoning of the area (Read our testimony). The proposal gives landmarks a central role by expanding their ability to transfer unused development rights. We spoke against the part of the plan that would guarantee the City more than a fair share of the transfer proceeds, leaving less for preservation.

The original intent of the Zoning Resolution provision that allows landmarks to transfer development rights was to provide building owners relief from the cost of maintaining landmark buildings and to assist in their preservation, but it limits the transfers to nearby sites. The current rezoning proposal expands that provision by allowing the landmarks to transfer the rights across a much larger area, and would assess 20% of the sales to create a fund for public realm improvements across the same area. The 20% figure is at the low end of a range that the Midtown East Steering Committee–of which the Conservancy was a member–recommended, and should ensure that the original intent of helping landmarks can be realized.

But the proposal goes too far, assessing at least $78 per each square foot transferred, based on a minimum “floor price” of $390, regardless of the actual sale price. That figure is substantially higher than the $250 per square foot price assigned in the Bloomberg-era proposal. This “floor price” would disadvantage landmarks in a market that is unpredictable, and potentially drain away funds for restoration and maintenance. A proposed three-to five-year schedule for evaluating the “floor” is insufficient. With the floor price, the City will be creating a set stream of revenue for itself, while the landmark owners have no such guarantee.

The City Planning Commission has until mid-June to vote. The final phase of the public review process will go to the City Council and vote this summer.

The East Midtown Steering Committee issued a set of recommendations that form the basis of the rezoning plan. Throughout the Steering Committee’s two years of meetings, our goal was to see landmarks play a more important role in rezoning than they did in the failed Bloomberg-era plan, which completely ignored historic architecture. We were pleased to see the designation of 12 new landmarks at the end of 2016.

The designated Midtown East buildings are:
50 Vanderbilt Avenue, Yale Club of New York
125 Park Avenue, Pershing Square Building
420 Lexington Avenue, Graybar Building
19 East 54th Street, Minnie E. Young Residence
57 East 55th Street, Martin Erdman Residence
18 East 41st Street, a neo-Gothic style office building
18-20 East 50th Street, Hampton Shops Building
525 Lexington Avenue, Shelton Hotel/Halloran House
125 East 50th Street, Benjamin Hotel/Beverly Hotel
511 Lexington Avenue, Hotel Lexington
400 Madison Avenue, a neo-Gothic style office building
601 Lexington Avenue, The Citigroup Center, including Saint Peter’s Church

City Intends to Limit Air Rights Transfer Fee on Landmarks in Midtown East

Preservationists and Midtown East religious institutions welcomed news that the City intends to limit the fee charged to Midtown East landmarked buildings to 20% of the income from air rights transfers, in return for allowing transfers over the broader area.

Air rights refer to empty space above a property that is not built as tall as the zoning allows.

Initial suggestions of the transfer fee included a range up to a much higher percentage. The Conservancy joined The Archdiocese of New York and other groups in arguing for the lowest possible amount. In a joint statement, the Conservancy and Archdiocese said the fees should not “undermine the intent of the transfer provision,” which is meant to assist in maintaining landmark buildings.

The City says it intends to use money generated by the transfer fees for “public realm improvements.”

Deputy Mayor for Housing and Economic Development, Alicia Glen disclosed the proposed fee in an interview on November 22. The 20% is within the range recommended by a steering committee headed by Manhattan Borough President Gale Brewer and Councilmember Dan Garodnick. The Conservancy served on the steering committee.

The City has allowed individual landmarked buildings to transfer air rights next door or across the street since it established air rights in 1961. The proceeds were to be used to maintain the landmark. The City created a Grand Central subdistrict to allow the Terminal a wider area to sell air rights, following a challenge by the then Terminal owner that resulted in the Supreme Court upholding the City’s landmarks legislation. Midtown East landmarks that sell air rights will be required to use the funds for restoration and maintenance.

Preservationists were concerned that the Midtown East proposal allows sites over transit hubs to build larger buildings in return for transit improvements—as happened at the site of One Vanderbilt—without buying landmark air rights. The proposal now calls for some purchase of landmark air rights even if transit improvements are made.

The air rights proposal will be part of a zoning proposal for Midtown East by the Department of City Planning. The agency plans to release the full proposal by the end of the year, starting a public approval process culminating in a City Council vote.