Last Friday, the City’s
Independent Budget Office
released Worth the Cost?:
An Examination of the
Commercial Revitalization
& Commercial Expansion
Programs. While the title is
an obscure mouthful, this
report takes aim at a set of
programs that have been
vital tools in nurturing
Lower Manhattan’s renaissance.
The report claims
that these programs, designed
to encourage commercial
tenants to move to
the neighborhood or renew
their leases in Lower Manhattan
with limited subsidies,
have had little impact
on Lower Manhattan office
vacancy rates and unemployment.
But the report’s
methodology is flawed and
the conclusions it seems to
reach aren’t really conclusions
at all. It misses the
point that Lower Manhattan
is still in the midst of
a strong, but incomplete
S POT L IGHT O N D OWNTOWN
Missing the Forest for the Trees
recovery from the impacts
of September 11th and fails
to recognize that these programs
are needed until we
finish the job.
Most glaringly, the report
does not come close to
sufficiently acknowledging
the impact--both materially
and psychologically-- that
the events of September
11th had on Lower Manhattan.
Not only did we lose
thousands of lives on that
fateful day, we also were
gravely set back as a critical
driver of the economic
life of our city, state, region,
and nation. Yet this unprecedented
terrorist attack is
only glancingly considered
in the report.
As we rebuilt after September
11th, and faced new
security concerns, outdated
perceptions, and a lack of
essential amenities, it became
incredibly tough to
persuade companies to
move to or remain in Lower
Manhattan These incentives
were an important
tool to help counteract those
forces and provide a reason
to attract new tenants. Yet
the authors of the report
didn’t take the time to interview
owners, tenants, or
locational decision makers
about how these programs
influenced their choices.
Additionally, throughout
the report, the IBO uses
Midtown Manhattan as a
control to purportedly show
that Lower Manhattan has
generally followed the ups
and downs of larger New
York market trends. Such
an approach leaves a profoundly
basic question insufficiently
addressed: what
would Lower Manhattan’s
performance have been
without the availability of
subsidies? We would submit
that it is precisely the
existence of these programs
that helped enable Lower
Manhattan to mimic larger
trends in other markets.
And finally, the report
fails to take into account exactly
what it took to achieve
the increased diversity in
the makeup of Lower Manhattan’s
commercial tenants
that has followed the
financial crisis in 2008, a
very long sought after city
policy goal. These programs
were a piece of what encouraged
a whole new set of industries
- media, technology
and advertising among
them - to take a fresh look
at Lower Manhattan. That
we now possess an enviable
mix of industries is a testament
to the contributory
impact these incentives
have had on transforming
our neighborhood and contributing
to the city’s economic
resilience, future,
and strength.
Furthermore, these incentives
have helped keep
commercial buildings from
converting to residential
uses, helped small businesses
start and grow, and
assisted scores of not-forprofits
like Hadassah and
International AIDS Vaccine
Initiative to succeed
here. By effectively reducing
their rents at a time
when many non-profit organizations
are struggling to
raise funds, it allows them
to dedicate more of their resources
to their vital work.
Maintaining more affordable
office space in Lower
Manhattan not only benefits
the city’s economic
well-being, it aids our social
well-being.
While we have come a
long way, there are still two
towers to build on the World
Trade Center campus and
large blocks of vacant space
elsewhere in Lower Manhattan.
The IBO report fails to
acknowledge how the incentives
have been, and remain,
critical to our ability to compete
within the region.
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22 November 15 - November 28, 2018 DEX Schneps Community News Group