City Planning Commission Approves Controversial Industry City Rezoning Plan

The Commission voted 11 to 1 in favor of the factious rezoning application, which would expand the Sunset Park manufacturing and innovation hub by 1.46 million square feet.

During a virtual hearing Wednesday, the City Planning Commission voted 11 to 1 in favor of the factious Industry City rezoning application—which would expand the Sunset Park manufacturing and innovation hub by 1.46  million square feet—citing the importance of focusing on economic growth as the city faces the financial fallout from a global health crisis.

After the CPC vote, the City Council will automatically review the developers’ application: the subcommittee on Landmarks, Planning or Zoning gets the first look, then the full Land Use Committee weighs in, and finally the entire Council can consider the proposal and has 50 days to act on it. By tradition, the Council usually follows the lead of the councilmember in whose district a project falls — Councilman Carlos Menchaca, whose district includes Industry City, has said he will vote against the project. 

Commission member David Burney, who cast the lone vote against the Industry City rezoning, said the private application would “diminish badly-needed manufacturing in the city” and would have a “negative impact and turn the area into another Jamestown shopping mall,” referring to one of the developer’s behind the project. He said the plan does not address the concerns of the community, pointing out that “there is heavy lobbying to reduce the role of the City Council member.” Fellow commission member Michelle De La Uz recused herself from the vote due to her role as executive director for Fifth Avenue Committee and its affiliate Neighbors Helping Neighbors, both nonprofits which work primarily in Brooklyn.

However, City Planning Director and Commission Chair Marisa Lago said it is critical to support projects like Industry City that will become economic drivers for future jobs, adding the city has lost an estimated 770,000 jobs since March. Several other commission members agreed.

The private rezoning application has faced contention with some members of the Sunset Park community. While some community groups welcome the expansion, others have been wary over the possibility it could lead to further displacement of residents and businesses in a community of color, which includes an active immigrant population.

These criticisms led Menchaca to ultimately reject the private rezoning application this July after several months of querulous attempts to reach a common ground between the city, Industry City executives and the Sunset Park community.

“While the City Planning Commission’s vote is unsurprising, given its development-at-any-costs mentality, it is still remarkable, and deeply offensive to the Sunset Park community, that the Commission defended their decision with weak reasoning and glaring omissions,” Menchaca said in a emailed statement. “First and foremost is the claim that Industry City must be given a blank check to do whatever they want because they promise to create thousands of jobs. With one exception, not a single commissioner thought to ask, ‘jobs for who?’ There is scant evidence to suggest that Industry City has created jobs for the working-class immigrant families who the Commission believes will benefit from the rezoning.”

Menchaca said giving private developers what they want without any accountability was not a successful path, and emphasized that the city should be rebuilding the economy before calling on his City Council colleagues to support him and his district. Most recently, Sunset Park saw a spike in COVID-19 cases, and the city has sent out additional support for mass testing to control the outbreak.

Traditionally, the local councilmember wields veto power over land-use applications in his or her district, a convention that developers and allies have questioned in recent years. Some lawmakers have recently questioned it, too.

In an opinion piece in the New York Daily News earlier this month, two of Menchaca’s current Council colleagues — Democratic Congressional nominee Ritchie Torres of the Bronx and Queens Borough President-elect Donovan Richards — argued the city is facing an unprecedented economic crisis, and needs the jobs the Industry City expansion is projected to bring. A New York Post editorial voiced similar concerns, saying the city must overcome its current financial crisis before rejecting projects which could create jobs at no cost to the public.

Dozens of real estate and labor groups recently wrote an open letter to City Council Speaker Corey Johnson asking his office to keep an open mind about the opportunities Industry City could bring.

“As you said back in 2018 at the beginning of your Speakership, Council approval of a land use project over the objection of a local member was ‘possible’ in the right circumstances,” the letter, posted on Partnership for New York City’s website, stated. “We can think of no circumstances more demanding of a thoughtful and decisive ‘yes’ than the current crisis. During the fight over Amazon’s HQ2 proposal, you and many of your Council colleagues suggested that the City’s ULURP procedure was the appropriate vehicle for project review, to facilitate robust community engagement and input, and to ensure that neighborhood residents would be proactively connected to newly created jobs. Industry City has followed the process you recommended.”

But other groups are questioning the city’s land use policies and how well they serve its  economy and neighborhoods.

The Citizens Budget Commission said that while it has not “focused extensively on the land use process or specific zoning proposals, CBC recognizes the best land use process and decisions will balance citywide and community needs, is based on solid analysis and some common criteria, is transparent and reasonably fast, and provides the certainty and predictability needed to support activities that catalyze job growth and increase a diverse housing supply.”

“CBC is increasingly concerned that at times the City’s land use process serves as an impediment, rather than as an instrument of improvement, to proposals needed to spur job creation and develop desperately-needed housing,” the group continued, saying they plan to conduct an “in-depth study” of the City’s land use policies and process.

Last September, Menchaca set three conditions which Industry City, the Sunset Park community and the city administration had to meet in order to give his support to the project. His first condition was to remove hotels from Industry City’s application altogether, but also allow for space restricted to industrial use and to restrict the total amount of space for retail use.

A second condition was for the mayor’s office to provide a written commitment supporting investments to help mitigate housing, workforce and educational challenges the neighborhood faces.

The final condition was for the Sunset Park community to bring forth a legal and binding document of community benefits agreement for Industry City. That agreement would contain commitments such as establishing a public technical high school and adult education center at Industry City, create a manufacturing hub, green energy infrastructure and offer support for local tenant advocates.

In January, Brooklyn’s Community Board 7 could not come to a conclusive vote in the Industry City rezoning because some of their demands — which mirrored Menchaca’s — could not be met.

Brooklyn Borough President Eric Adams did approve the private application in March but with conditions, such as removing hotels from the special district along with a demand to “restrict school locations, limit big box and destination stores and venues.”

According to Menchaca’s office, Industry City said they would remove hotel use from the application closer to the City Council vote, but there has been no written agreement. The mayor’s office made no capital commitments for community investments because the application is a private rezoning, not something sponsored by the de Blasio administration. And Sunset Park community groups, the Sunset Park Benefits Coalition, had yet to finalize their community benefits agreement before the CPC vote, in part because negotiations were impacted by the pandemic.

Industry City is a warehouse complex situated inside the historical Bush Terminal by the Gowanus Bay in Sunset Park, Brooklyn, stretching from 32nd to 41st streets between 2nd and 3rd avenues. In 2013, a group of developers and investors acquired the site  with the intention of building a retail, commercial and light industrial business hub. The rezoning application seeks to increase Industry City’s manufacturing and retail campus by 1.45 million square feet to include two hotels, department stores and educational buildings—a $1 billion expansion over the next 12 years.

“By agreeing to update regulations that were put in place decades ago, city government will send a strong message that New York is ready to turn the corner and begin its recovery from the worst crises it has ever faced,” said Andrew Kimball, Industry City CEO, in an emailed statement.

“After considering the facts, including that the proposal will lead to the creation of 20,000 good paying jobs and generate $100 million in annual tax revenue, the City Planning Commission has now recommended that the plan be approved. We will continue to make the case for this proposal and look forward to working with the City Council and other community stakeholders as the approval process enters its final phase.”

The site’s current M3-1 zoning — which is for areas with heavy industries such as solid waste transfer facilities and recycling plants, which create noise or traffic and are usually located near the waterfront, buffered from residential areas — does not permit some of the project’s proposed uses. The rezoning application is seeking an M2-4 designation, where the maximum base height can reach up to 85 feet.

According to the Environmental Impact Statement for the proposed rezoning, the applicants also want to create a “Special Sunset Park Innovation District” where research, development, design to engineering and manufacturing of a product could happen under one roof, a goal in line with the de Blasio administration’s 2015 Industrial Action Plan.

Overall, the Industry City rezoning proposal would use a large portion of the site’s existing campus, an estimated 5.3 million gross square feet of development, adding 1.46 million gross square feet in new construction or improvements of existing structures.

The entire project would total an estimated 6.6 million gross square feet and would include some combination of manufacturing, commercial, retail, hospitality, academic and other community facility uses, according to the Department of City Planning. The proposal would rezone 30 acres and create the special district for three new buildings, as well as what Industry City promises will be a pedestrian-friendly environment for ground use. It would also demap 40th Street between 1st and 2nd avenues.