Testimony of the Real Estate Board of New York Before the Manhattan Borough President and Manhattan Borough Board in Support of the Garment Center Special District Proposal

The Real Estate Board of New York is a trade association comprised of owners, builders, residential and commercial brokers and managers and other professionals active in New York.  We support the zoning and economic development proposals for the Garment Center.

The City’s Economic Development Corporation (EDC) has developed a two-part program in response to the community’s long-standing desire to preserve apparel production in Manhattan’s Garment District.  EDC’s first program is the Industrial Development Agency (IDA) tax abatement program that will guarantee 15 year leases at reasonable rents for 300,000 square feet of apparel tenancy in participating buildings.  EDC’s second initiative is the commitment of $20 million for the purchase of a building, in partnership with a non-profit entity, to provide space for apparel production long into the future.

Both of these programs were developed in response to the recommendations of the Garment Center Steering Committee and represent the most meaningful commitment the City has ever made to preserve apparel production in its historic home.

In addition, the City will also lift the zoning restrictions set in 1987 that imposed severe restrictions on permitted and expanding commercial use on the mid-block buildings in an effort to preserve apparel jobs which had been declining, locally and nationally, for decades. This restrictive zoning ultimately proved to be an inadequate tool in aiding the apparel industry — as has other manufacturing zoning designations throughout the city to preserve declining industrial jobs.

However, these restrictions did nothing to slow the decline of apparel production in the area over the past 30 years—including the first five years in which the restrictions had regular enforcement.

Meanwhile, the Garment District languished as the surrounding areas flourished In the midst of a radical and unmistakable transformation of the city’s economy.

For example, as our service economy grew, the underutilized industrial space in Midtown South naturally accommodated this economic transformation.  Today, Midtown South has an estimated 75 million square feet of office space.  Separated from the Manhattan market, Midtown South would be the fourth largest office market in the country after the rest of Manhattan, Chicago and Washington D. C., and larger than Atlanta, San Francisco, Houston, Boston and Los Angeles.

Zoning is simply an ineffective tool in protecting an industry from the larger and evolving local, national, and global economic forces. The City imposed a unique but well-intentioned burden on midblock buildings to halt the decline of apparel production jobs.  However, thirty years of evidence shows that these restrictions did not achieve its goal.

Instead, the City has developed a robust economic proposal, at the behest of the community and industrial stakeholders, which will retain a core of the apparel manufacturing industry in the Garment Center for the long term. The Special Garment Center Text Amendment and EDC proposal represents our best chance to assist the apparel manufacturing industry and urge the Manhattan Borough President and Manhattan Borough Board to approve these actions.