Small Businesses are Also Worried About the East New York Rezoning

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Mary Ulloa serves lunch to seniors at the La Familia Adult Day Center on Fulton street. Its owner fears her rent could triple after the rezoning.

Adi Talwar

Mary Ulloa serves lunch to seniors at the La Familia Adult Day Center on Fulton street. Its owner fears her rent could triple after the rezoning.

Rafaela Villafana opened La Familia Adult Daycare in East New York nearly four years ago after spending over a decade working in senior centers. A social worker by trade, Villafana wanted the opportunity to work as her own boss while still serving a community she's grown to love.

The senior residents who come to La Familia from East New York and its surrounding areas spend five hours a day gabbing and playing Dominoes in between the breakfast, lunch and dinner the day care provides. They also receive social services and transportation to and from the day care, located next to a Bravo Supermarket on Fulton Street between Linwood and Essex Streets.

"They socialize. They have friends. They fall in love here," says Villafina, who now lives in Ozone Park after living in East New York for more than a decade. "Last year, a couple got married here. It was amazing."

But Villafana fears she will have to shutter her business if the City Council approves Mayor Bill de Blasio's plan to rezone East New York. Once development is actively underway, Villafana believes her rent could jump from $5,000 a month — what she pays now — to $15,000 or even $20,000 a month — a hefty price tag she says she can't afford. She also worries she will slowly lose her clientele because the low-income seniors who come to her daycare will be displaced by unaffordable rents.

"Then what happens to my business?" asks Villafana. "I'm very, very concerned."

A housing plan's impacts, beyond housing

Critics of the East New York rezoning plan—including the We Mean Business. East New York. advocacy campaign of which Villafana is part—fear that small businesses won't be able to weather the rising commercial rents, which have climbed steeply since the announcement was first made that the city was looking to rezone the neighborhood. Opponents believe high rents will force established businesses to close their doors and make East New York inaccessible to mom-and-pop stores looking to move in.

Instead, they say, new development will only allow for big-box retailers and restaurant chains to set up shop in East New York if the de Blasio administration doesn't make moves to protect local residents and businesses before the plans in place.

"You need to do something on the front-end," says plan critic Michelle Neugebauer, executive director of the Cypress Hills Local Development Corporation. "You can't wait for people to get the eviction notice or for the rents to skyrocket."

Mayor de Blasio targeted East New York as the first of 15 neighborhoods to be rezoned under his Housing New York initiative, which aims to tackle the affordable housing crisis and incite neighborhood revitalization. Under the plan, the long-neglected East New York will see construction of over 6,000 housing units, half of which will be rented at below-market rates. The proposal also calls for investment in retail and job growth, with plans to strengthen industrial zones, create improved retail corridors and rezone manufacturing hubs into mixed-use developments.

Critics have panned the rezoning plan from the beginning, saying it will provoke gentrification and displacement. Many residents fear East New York will turn into another Williamsburg, where, after former Mayor Michael Bloomberg's 2005 rezoning, half of the manufacturing jobs disappeared and less than 15 percent of the area's total housing is affordable. The Department of City Planning, however, minimizes the risk of displacement, asserting that market trends showing already-rising rents indicate that gentrification would happen with or without rezoning.

As City Limits reported last week, the City Planning Commission gave the contentious rezoning plan the green light on Feb. 24 in a 12-to-1 vote. The Coalition for Community Advancement — a vocal group of local organizations, churches, small business owners and residents — criticized the approval, while Planning Commission member Michelle De La Uz, who cast the single nay vote, said the proposal "falls short of achieving inclusive growth." Proponents of the plan, though, believe the administration's investment in the area will spur residential and commercial advancement in an area long considered "underdeveloped." The plan now awaits action by City Council — the crucial stop in the Uniform Land Use Review Procedure (ULURP) process. A hearing on the proposal took place earlier this week.

What kind of growth?

When cities talk redevelopment in low-income areas, the underlying economic theory seems to be that in order to spur economic growth, middle- to upper-income people must move in. Residents earning higher salaries, the theory goes, would demand a wider breadth of goods and services, and businesses would more likely want to meet that demand.

"We just don't agree with that theory," says Neugebauer, whose organization is a coalition member. The city, she continues, hasn't been "transparent" in its belief in that philosophy. "Cypress Hills/East New York is an example of a healthy, thriving low-income community."

It's not that East New York is devoid of retail options. The shops along Fulton Street, Pitkin Avenue and Liberty Avenue do serve some of the residents' retail needs. But, contends City Councilman Rafael Espinal, whose district covers East New York and Cypress Hills, the strong businesses don't make up for the weak and fragmented retail corridors — more often than not, residents go to other neighborhoods to shop. Current residents are inundated with 99-Cent stores and bodegas; instead, he says they need the same type of destination supermarkets and clothing shops found in other parts of Brooklyn.

But, opponents say, under de Blasio's plan, there aren't any substantive incentives to bring in the types of mom-and-pop shops that are not only affordable to residents, but will also invest in the community in a way chain retailers like Target won't. Nor, they say, does his plan include any anti-displacement protections that would keep thriving small businesses in place.

"Mom-and-pop shops need more protections and they need more programs to make sure that they continue operating and staying in the neighborhood," says Espinal.

A different vision

Last summer, the Coalition released an alternative to de Blasio's plan, which it advised the city to adopt, that proposes policies it says will discourage residential displacement and facilitate the preservation of businesses on commercial corridors. Among the proposed actions, the Coalition calls for lower rental costs for mom-and-pop shops in new city-subsidized developments, technical and legal assistance for small businesses, financial aid for business improvements, tax credits for landlords who maintain established small businesses or offer low rents. It also demands the city make efforts to fill commercial space in its designated destination retail spots with businesses that wouldn't pose "undue competition" on local retailers — in other words, not building a Walgreens a half mile away from Umamah-Pitkin Pharmacy.

The Coalition's plan also demands the city keep avenues zoned for manufacturing as they are, rather than re-designate them as mixed-use; they fear mixed-use zoning will entice industrial landowners to sell to residential developers.

The city, though, plans to concentrate manufacturing land in East New York's existing Industrial Business Zone, which the Department of Small Business Services and the New York City Economic Development Corporation plan to bolster through business and job investments. And to help local resident with job placement, the city will also create a Workforce1 Satellite Center, as proposed by the Coalition as a way to combat East New York's 19 percent unemployment rate.

Neugebauer says that, since this is the first rezoning in the mayor's larger initiative, the city can set a new precedent in urban redevelopment by implementing residential and commercial policies that reduce gentrification and protect East New York's most vulnerable residents.

"The wave is coming from both ends," she says of East New York, which sits south of Bushwick and east of Bedford-Stuyvesant — two areas undergoing rapid gentrification. "It's incumbent upon the city to proactively do something different."

When reached for comment, a spokesperson for the mayor shared remarks de Blasio made a recent conference at Bedford-Stuyvesant's Mt. Pisgah Baptist Church. At the event, the mayor told the crowd that the city will fight for "businesses that are going to pay a good wage … not Wal-Marts that are going to give people a pittance."

The mayor's office did not return a follow-up request for comment.

Small Business Services is currently conducting a months-long Commercial District Needs assessment, including a shopper survey, to appraise East New York's retail and small business sector, and identify missing goods and services. Once it's complete, the agency will create an action plan to implement recommendations from the assessment and fund efforts for business attraction and retention.

A push for investment

"This is neighborhood that hasn't received any sort of investment from the state or city governments for decades," says Espinal, who agrees gentrification is bound to happen even without the rezoning. "If we're pushing retail in our neighborhoods, let's make sure the retail pays a fair wage, hires locally and we have better options than we currently have."

Councilman Espinal and opponents of the current plan, which includes Brooklyn Borough President Eric Adams, also believe that, in order to spur economic growth, established East New York businesses need to be engaged during development. Hiring local firms to work on planning, design and construction means money will flow back directly into the community in which they operate.

If the city contracts from places like Long Island or New Jersey, though, critics say the money outside firms make from development will stay exactly there — outside.

"If we're building East New York, why don't we let the companies that are in East New York participate," says Bill Wilkins, director of Industrial Development at the Local Development Corporation of East New York and a coalition member. "That becomes economic stimulus."

Wilkins calls de Blasio's rezoning plan "audacious" with "many moving parts." Many critics feel the mayor's efforts are disingenuous because of how long East New York has been neglected for decades by previous administrations, he says. But, Wilkins continues, the mayor and his administration have an opportunity to meaningfully engage the community, show sensitivity and compassion, and "get this right"—in other words, be the anti-Bloomberg de Blasio claims to be and actively protect with the very community he claims the East New York rezoning plan will help.

"God isn't making any more land. We don't get a chance to do this over," he says. "If we all commit collectively for the common good, then this becomes the model that will be studied for the next 10 or 20 years by urban planners."

  • JaneNYC

    This is not the Bill de Blasio administration i was hoping for. As a member of the City Council, he supported the Small Business Jobs Survival Act (also known as the SBJSA). Now as mayor he does not. Is Why? If the SBJSA is flawed, why won’t the Mayor propose something else to help small businesses defend themselves again predatory rent increases? http://www.savenyc.nyc/ is a good place to learn more.