In the issue:
- Big Real Estate Must Stop Exploiting the EB-5 Visa Program (Op-Ed by Alan Berger)
- 3 Photos: How Big Real Estate is Financing our Mayor’s Re-election
- Your Primer on the Mayoral Race so Far (by Mike Van Italie)
- The Race to Make Midtown into Dubai: How They Take Away Our Sunlight
- New co-sponsors of the Alliance for a Human-Scale City petition at www.humanscale.nyc
- Quote of the Week
Big Real Estate Must Stop Exploiting the EB-5 Visa Program
Op-Ed by Alan Berger, Concerned Citizens for Community-based Planning
“All the [real estate] investor needs to do is plunk the money down and they get green cards for themselves and their families.”
According to Wikipedia,
“The EB-5 visa provides a method of obtaining a green card for foreign nationals who invest money in the United States. To obtain the visa, individuals must invest $1,000,000 (or at least $500,000 in a Targeted Employment Area — rural or high-unemployment area), creating or preserving at least 10 jobs for U.S. workers, excluding the investor and their immediate family. Under the first EB-5 program, the foreign investor was required to create an entirely new commercial enterprise; now, investments can be made directly in a job-generating commercial enterprise…..or into a “Regional Center” — a third-party-managed investment vehicle (private or public), which assumes the responsibility of creating the requisite jobs. Regional Centers may charge an administration fee for managing the investor’s investment.“
Sounds obscure, right? Not really. Here’s where the EB-5 dovetails with the work of Human Scale NYC:
“Major developers have begun to form their own regional centers with the goal of soliciting EB-5 investments. Silverstein Properties, for example, has marketed their Downtown Manhattan The Four Seasons as an ‘EB-5 investment opportunity’ on their website. Other projects that have received EB-5 Regional Center funding include the Hudson Yards Redevelopment Project, the George Washington Bridge Bus Terminal, and the New York Wheel.“
The developments referred to above located in “regional centers” created by the investment managers, include new construction of residential buildings. The developer starts and runs the regional center so that it ostensibly complies with U.S. laws (there’s very little regulation in this area) and charges a fee to the investor for their services. All the investor needs to do is plunk the money down and they get green cards for themselves and their families. Take a look at this Extell site: http://eb5extell.com/ (see photo above).
Where are much of the investments coming from? Fortune Magazine tells us: “The growing demand for EB-5 financing is being met largely by new Chinese millionaires, eager for greater freedom and less pollution, or to send their kids to college in the U.S. More than 80% of the program’s applicants now come from China, making it the mother lode for EB-5 prospecting.” (See, Fortune, 7/24/14, “The Dark, Disturbing World of the Visa-for-Sale Program.”)
So while the Trump Administration is ratcheting up their plan to round up and deport poor and working class immigrants, the vast majority of whom have been law-abiding citizens for many years and who positively contribute to the U.S. economy and society, immigrants with means can simply buy into the U.S. through the EB 5 visa program. In so doing, they aid the proliferation of hyper-development in NYC by giving developers cheap financing in an almost totally unregulated market. Outrageous!
Who is Financing our Mayor’s Election?
Big Real Estate and their dependents, that’s who. We printed out the first three pages of the list of donors to the Mayor’s re-election campaign. We sorted the list by size of the donation. Then we used a pink highlighter to showcase anyone linked to Big Real Estate. That means a real estate CEO, the wife of the CEO, or the lawyer, lobbyist, or PR person for the CEO. Alas, even the artist listed on Page One turns out to be someone who does the lighting for the giant tower known as 1 World Trade Center.
The unexpected part of this research is that even the non-highlighted names are mostly billionaires. Seems like it is time for a new comedy troupe to come to town: Billionaires for De Blasio.
Your Primer on the Mayoral Race – so far
By Mike Van Italie
First Up: The Basics of Our Campaign Finance System
As the 2017 NYC Mayoral Election race begins to ramp up, we at New Yorkers for a Human-Scale City thought it would behoove us to summarize the current state of the race and a bit about how our Campaign Finance System works.
Fourteen candidates are listed on the New York City Campaign Finance Board site as having declared their candidacy for Mayor. The important names for the Democratic Primary are, for now, Bill de Blasio, former City Councilman Sal Albanese, and State Senator Tony Avella. The Republican side is dominated by real estate executive Paul Massey and former NY Jets player Michael Faulkner. Some well-financed Democratic opponents to de Blasio remain “rumored candidates,” likely waiting for the results of the corruption probe into the Mayor’s past fundraising before deciding whether to run. Those on the fence include City Comptroller Scott Stringer, Bronx Borough President Ruben Diaz, Council Speaker Melissa Mark-Viverito, U.S. Representative Hakeem Jefferies, and even (as rumor has it) Hillary Clinton.
|Candidate||Party||Total Funds Raised||Number of Donors|
|Bill de Blasio||Democratic||$3,314,815||4,908|
|Richard “Bo” Dietl||Independent||$282,656||131|
*Undeclared, but rumored to be considering a run.
The website of the City’s Campaign Finance Board (CFB) features a “Campaign Finance Summary” page that allows the general public to view the details of each candidate’s fundraising activities. This gives an excellent window into the current state of the race and who is behind each candidate. Voters can click on each candidate’s name to get a detailed summary of their fundraising, and then again on “monetary contributions” to view a complete list of their donors and the amount of each donation.
Importantly, candidates for Mayor must raise over $250,000 and receive donations from at least 1,000 city residents to qualify for the “Public Matching Funds Program,” which matches all contributions up to $175 at a ratio of 6 to 1. Reaching this threshold is, therefore, the key to a candidates’ legitimacy, as it balloons donations, for example from $175 to $1,225.
Which candidates meet that threshold? Currently only Bill de Blasio, who has already amassed $3.3 million from 4,908 donors. Republican Paul Massey, however, has raised an impressive $1.63 million, although that is not surprising given his real estate background. He is approaching the 1,000 donor threshold, but has made a point of saying he will not participate in the Matching Funds Program. Instead, he has put up an additional $1.2 million of his own money. The other declared candidates have much further to go to reach the matching threshold. For the Democrats, Sal Albanese has $32,301 from 243 donors, while Tony Avella has raised a mere $725 from 7 donors. Republican ex-Jet Michael Faulkner has raised a sum of $206,591 from 189 donors, while Independent long-shot and former NYPD Detective Richard “Bo” Dietl has $282,656 from 131 donors.
Significantly, however, three undeclared potential candidates—Ruben Diaz, Melissa Mark-Viverito, and Scott Stringer—have already begun raising money and are either at or near the threshold. Comptroller Scott Stringer leads the group with just over $2 million from 1,509 donors, Bronx President Ruben Diaz has $1.2 million from 1,095 donors, and Council Speaker Melissa Mark-Viverito has $872,454 from 889 donors.
While the Public Matching Funds Program and the CFB’s donation limits theoretically democratize campaign finance by empowering small donors, the threshold for activating the funds is so high that only a select few—insiders with a network of well-heeled connections—can benefit. We need to reform this system so that experienced but relatively lesser-known candidates can compete with the well-funded incumbent Bill de Blasio and the equally well-funded real estate guy, Paul Massey. Both of their donor lists read like a “who’s who” of the Real Estate Board of New York.
If you want a meaningful democracy, do consider giving even a tiny amount (just $10 will do) to the less well-known candidates or outsiders, so that they can meet the thresholds. Only then can we have a real Mayoral race and a significant public debate.
Democracy depends on you!
Declared Candidates and Links to their Websites:
A Selection of Some of the (Somewhat Less Biased Than Usual) Coverage of the Race in the Mainstream Press:
The Midtown Proposal to Create Dubai-on-Hudson:
How They Will Take Away Our Sunlight
Who wins? 79 Unnamed Midtown Property Owners
Who loses? The Public
The Mayor’s proposes to use public resources to give pots of money to 79 Midtown property owners and then give them free reign to demolish and then rebuild Midtown into Dubai. We don’t know yet if any of the 79 property owners contributed to the Mayor’s campaign fund, or if their lawyers or lobbyists did. We do plead with the Fourth Estate: investigate and name names! You have more resources than we do.
The deal works like this: the city takes away public airspace and sunlight and gives it to 79 midtown property owners in the form of an increase in their baseline buildable allowance (called FAR). We don’t know yet who these 79 property owners are or why their needs trump those of the public.
Here is a map of the shadow impact that the plan will have on the rest of us:
The gift of airspace and sunlight would happen in a 70-block area that contains 86 landmarked buildings and 400 buildings in total, an area that also has a number of supertalls already coming up as of right – a problem not discussed in any of the project documents. The project would also displace (via demolition) 855 businesses that now employ 24,000 people. Here is another rendering from the Municipal Arts Society.
Millions of Square Feet
The lucky 79 Midtown property owners would be allowed to take all that public sky and air and build upwards to an additional 17.6 million square feet of space (EIS, page 9.1). It would also allow them to demolish the many already over-built buildings that are now in violation of the zoning code, and then rebuild them back to the same over-built level — without penalty – so that they redo the floor plans, mostly by eliminating supporting columns and low ceilings and then take advantage of other ways to build even taller. They will have to make a payment for that privilege.
The proposal also gives these 79 Midtown Property Owners – and their developer friends – two additional ways to build even taller than the increase in base buildable envelope allows. How so?
- They can buy unused airspace from the Catholic Church (ex: St. Patrick’s) and other landmarked buildings. Then they can stack those rights on top of their existing buildable allowance. The City also wants to take a 20% cut from these air rights sales and park the proceeds a local public space improvement fund, to be managed by Mayoral appointees. There is right now some 3.6 million square feet of air and sky and sunlight that is at present “unbuilt” by the landmark buildings in the area. Developers are desperate to get at those 3.6 million square feet. Now they would have a way.
- They can get a 20% bump-up of their buildable allowance by paying for transit improvements. The proposed improvements are extremely limited in scope and unimaginative – such as handicapped access improvement to the subway. Good things, but they hardly constitute a commensurate public give-back for the takings of that airspace.
Taking Away Light
Does all this sound like a real estate scam to you? Does to us. A bizarre part of the story is something that everyone admits in the project documents: Midtown is already over-congested and is a canyon world that is also already overbuilt and too dark. So building another 17.6 million square feet is definitely a problem. Want proof? Take at look at this 1981 daylight map showing streets of zero sunlight in black and streets with less than 70% daylight in gray. The plan is to make this zone even darker.
Fake Mitigation of the Darkness
Have no fear, the City tells us, the extreme over-congestion and darkening that the plan will create will be “mitigated” in the following way.
- Developers will have to build a few new subway entrances (note: we don’t get new subways, nor more trains, nor more frequent trains. We get new entrances and maybe some elevators so that people in wheelchairs can more easily reach the subway platform)
- They will pay for the widening of a few sidewalks to accommodate those huge numbers of new office workers
- They will close off some side streets to car traffic so as to make DOT pedestrian plazas (which they should do anyway)
- They will shine electric lights into the stained glass windows of St. Bartholomew’s Church to mitigate the big shadow over those windows to simulate sunlight [sic]
They will experiment with the “Shared Streets” idea, in which pedestrians and cars will somehow mix – see fantasy picture below:
The Midtown Plan Steals from the Public and Doesn’t Give Back
The map above shows the “impact area” of the new shadows that our own Beijing-on-Hudson district will create. It is a huge zone that extends into Central Park. The public realm will be deeply darkened by this plan, so why didn’t the City even do a proper daylighting analysis in 3D to show us the impact, one similar to the 1981 Kwartler map above?
The conclusions are not good. Think about it. We lose the last bit of daylight from the rest of Midtown’s streets, turning the entire area into Bladerunner World. We GIVE AWAY public sunlight, sky, and airspace to the tune of 17.6 million square feet. And all we get in return is some pedestrian plazas and subway entrances in exchange.
Bad deal, folks! Terrible deal in fact.
What should we get in return? An Eye for Eye
Instead, let’s apply the justice rule of “an eye for eye.” Let the public have the 17.6 million square feet returned to us in the form of 17.6 million square feet of: 100% and forever affordable housing, public parks, libraries, schools with gyms and schoolyards. Or, we could let Midtown go in exchange for forever preserving the low-rise character of historic neighborhoods of Chinatown, East Harlem, and Inwood.
The point is, we should be getting a lot more in exchange for such a giveaway. Stay tuned for more Midtown stories in the as the project grinds through the land-use approval process.
New Co-Sponsors of the Human-scale Petition
Welcome to SAVE CENTRAL PARK, a new group formed to fight the shadows in Central Park and the absurd new tower proposed for 66th Street. Their website link is not yet live, but when it’s up, we will let you know.
Also welcome the St. George Civic Association of Staten Island. Their website is here.
Quote of the Week: Jane Jacobs of Course
We won’t really get things done differently and better until citizen resistance makes it impossible – or too frustrating – to do things as they are being done now.
From: Jane Jacobs Interview with Eve Auchincloss and Nancy Lynch, Mademoiselle, October 1962.