Community Forum for Extell's Riverside Center

New York Times: For Billion Dollar Extell Profits, Against Citizens and Elected Officials

Yes, the venerable New York Times actually mentioned Extell's massive, agreement-breaking development of the last major plot of riverside property in mid-town Manhattan! But of course, they weren't really paying attention; the only actual work they did amounted to an unpaid (or was it?) advertisement for Gary Barnett and Extell.

What did the reporter miss? Merely everything that wasn't in Gary Barnett's favor, that's all.The Times prominently featured the one single review, by City Planning, that has come out in his favor, ignoring all the rest. It's like talking about what a great baseball hitter someone is, when the player has made outs 9 of the last 10 at-bats, and the one time they got on base was due to a fielder's error.

Here's a brief summary of the events related to Extell's Riverside Center project that the New York Times would prefer you not know:

• Yes, City Planning approved Riverside Center -- but in doing so, it blatantly violated its own policies and planning principles.
• Manhattan Borough President Scott Stringer rejected the proposal.

"Mr. Stringer ... took issue with a number of points, but principally focused on the density (he wants 480,000 square feet less), the open space (he wants it to be more open and inviting), and the schools (he wants Extell to fund a bigger school).

Specifically, on the density issue, Mr. Stringer's recommendation was critical of Extell for essentially seeking more density than it should be entitled to, given that Extell is leaving 60^th Street closed off, getting more development rights as a result (allowable density is based on the size of the site; with a street closed off, the site is significantly larger)."

• NYS Senator Tom Duane rejected the proposal.

"As CB7 notes, the current proposal not only fails to mitigate some of the most troubling negative impacts identified in the project’s Draft Supplemental Environmental Impact Statement (DSEIS), but it also fails to remedy the existing Riverside South development's enduring adverse impacts. Furthermore, certain aspects of the proposal violate the community's Core Principles as expressed by CB7 and must be modified accordingly."

• NYS Assemblymember Linda Rosenthal rejected the proposal.

"When Donald Trump gained control of the entire site in 1992, he signed a Restrictive Declaration to build 5,700 apartments. The new developer has proposed to build an extra 1,292 residential units, which I believe would make this site too dense."

• NYC Councilwoman Gale Brewer has been very active, and is resisting Extell.

"Council Member Gale Brewer reiterated her strong support of changing the Riverside Center development at the City Planning Commission’s Sept. 15 public meeting.

Brewer testified that the commission should heed the recommendations offered in a comprehensive report that Community Board 7 issued in July.

“They heard me loud and clear,” Brewer said of the commission. “I usually don’t go to the mat, but this time I’m going to.”

During the last major development on the Upper West Side to go through a public review process—the expansion of Fordham University’s Lincoln Center campus—Brewer was more cautious in comments about changes she wanted to see in that project.

This time, the community board issued a 47-page report that recommends greatly scaling Riverside Center down. The breadth and detail of the report earned Brewer’s support, which she is voicing throughout the land use review process.

“To be honest with you, most community boards don’t put this much effort into a document,” she said. “They thought of everything, that’s why I support it.”

• The above officials and US Representative Jerrold Nadler signed a letter declaring that the Restrictive Declaration remains in force and should be enforced, having the effect of substantially reducing the density of the development.
• After extensive hearings and public meetings, Community Board 7 rejected the proposal.

"After more than two years of careful analysis, and scores of community meetings, Manhattan Community Board 7 voted on July 22, 2010 to disapprove Extell Development Company’s proposal for Riverside Center"

• Community groups speak out against the proposal:
  • Straphanger's Campaign and NYPIRG

  "…no persuasive argument has been made for why Riverside Center should add any additional parking to the current commercial supply." 

  • The Coalition for A Liveable West Side

  The City Planning Commission must insist that Extell adhere to the maximum density in the 1992 Restrictive Declaration for this site (59th -61st Street). The City Planning Commission must deny the increase in zoning that Extell has asked for.
  In addition:
  There must be a Public Park and all the streets built upfront by the developer;
  the entire Public School, not just the shell of the school must be built by the developer;
  there must be a minimum of 20% affordable housing units; and parking spaces must be limited to 743 parking spaces as per the 1992 Restrictive Declaration.  

  • The Community District Education Council 3
  • The 10WEA Riverside Center Committee
  • The Committee for Environmentally Sound Development

• Community groups propose alternatives:
  • A meeting to propose and discuss alternatives.
  • Coalition for a Liveable West Side alternative plan.
  • RSPC alternative plan
  • CB7/Kwarter analysis and plan.
• Extell's partner Carlyle Group settles for $20 million AG Cuomo's influence-peddling suit.
• Courts ruled that the Restrictive Declaration governing Extell site remains in force, and that it has violated its contracts for its development next door.
• The Times has a history of ignoring the exploits of Barnett, Extell and his financial partners, the Carlyle Group, as previously documented here.
• This blog blasted holes in Extell's arguments in favor of its proposals.

"The Barnett/Extell/Carlyle strategy is now clear: assume you will get the variances you need to vastly exceed previously-agreed-to, legally binding limits; poor-mouth and threaten shut-down when any reductions, however minor, are suggested; and refuse to disclose the vast additional profits you stand to make by getting approval. The reason is simple. If people knew how much money Extell & co really stand to make from this project, they would first laugh, then get mad, and finally make Extell act like a responsible organization."

The New York Times likes to sound like they're against big money and big power. They write editorials about abuses in the financial system, and feature stories about how big institutions have abused normal people with sleazy mortgage practices. This is nothing but propaganda. The reality is that when big money is involved, as it is with Gary Barnett, Extell, the Carlyle Group and Riverside Center vs. the citizens and elected officials of New York, The New York Times is squarely on the side of the money.

At this point, our last defender is the wonderful Councilmember Gale Brewer and the City Council. We can only hope that she and the Council will stand up against the billion-dollar interests. No one, by the way, is against development here; we just want development that adheres to sensible policies, past agreements, and the united will of the citizens, elected officials and community groups that have looked at the plans.

Update:

How much pressure and influence is Extell exercising behind the scenes to smooth the way to their billion dollar profit here? I suppose we'll never know, but it seems to say something when:

• "Lela Goren, a business partner of Extell's who does extensive work with the company, held a fundraiser ... for Council Speaker Quinn...," and
• "A spokesperson for Extell, George Artz," while claiming that it "...wasn't an Extell event," has to admit that "...numerous Extell executives...attended."

The excellent article that reports the event points out:

"Real estate donations are nothing novel in campaigns, but this fundraiser happened at the very time that Extell is seeking zoning approval from the City Council for its mega-Riverside Center residential development..."

Speaker Quinn, this is an excellent opportunity for you to demonstrate your commitment to campaign finance reform. Councilmember Brewer, we're confident that you'll do your best!

 

Court: Restrictive Declaration Applies to Extell

In a decision issued November 24, 2009,the New York court of appeals affirmed that Extell and all its successors are bound by the terms of the 1992 Restrictive declaration. This is an important decision because it limits the extent of what Extell can build on the property to limits agreed to with the community.

The suit was brought by the Riverside South Planning Corporation, RSPC, against Extell and the Carlyle Group, the current developers of Riverside South and RIverside Center. RSPC sued Extell and Carlyle to cooperate with RSPC per the terms of prior agreements. It lost, and appealed. On November 24, 2009, the appeals court issued its decision, affirming the lower court's rejection of RSPC's claims.

The decision was focused on a clause in a separate Letter Agreement. The court said:

In this breach of contract case, we are asked to
determine the scope of a sunset clause that appears in a 1993
Letter Agreement relating to the development of a parcel of real
property.  ...we affirm the judgment dismissing plaintiff's claim.

This is not the decision RSPC wanted to get -- I don't yet know whether this will be the end of the matter. As readers of their website will know, they have some excellent ideas and proposals. And more than their ideas, someone needs to check what the developer is actually doing and make sure it conforms to the terms of the Restrictive Declaration.

However, the sunset clause in question is not in the Restrictive Declaration -- it's in a separate 4 page Letter Agreement specifically concerning the relationship between the developer and RSPC. However discouraging it may seem, this courtroom loss is limited to obligations Extell has to RSPC. It says nothing whatsoever about Extell's obligations to the community, as expressed in the 284 page Restrictive Declaration recorded with the New York City Register.

The court's opinion makes this very clear. Here is their description of the Restrictive Declaration:

...in 1992, formal approval was obtained from the City of New
York. Penn Yards recorded a 284-page Restrictive Declaration
with the New York City Register memorializing that approval.
Having been recorded in the chain of title, the declaration
imposed numerous restrictions on the owner that would run with
the land and bind any developer as well as any successors or assignees.

This court case is not about the Restrictive Declaration, but about a later short agreement between Trump and the RSPC.

On March 31, 1993, Donald Trump entered into a four page
Letter Agreement with the RSPC to "confirm our arrangement
to continue working together."

The cornerstone of the case concerns a sunset clause:

Most relevant to this case, a sunset provision was
included on the third page of the four-page Letter Agreement

It was the sunset clause in the 4 page Agreement that was the subject of the suit lost on appeal by RSPC, not the Restrictive Declaration. So that there may be no doubt about that, the court went out of its way to explicitly affirm the fact that the Restrictive Declaration remains in force without sunset and without limit, "binding all successors for all time -- including Extell." Here is the language:

We further note
that RSPC succeeded in negotiating a Development Plan that
incorporated environmental sustainability and design criteria
and, unlike the Letter Agreement, such plan is part of the
Restrictive Declaration that is recorded in the chain of title
and runs with the land, binding all successors for all time --
including Extell. Nothing we decide today allows Extell to
unravel that significant accomplishment of the RSPC.

In summary:

• On November 24, 2009, the appeals court affirmed that Extell is not required to interact with RSPC under the terms of the 1993 letter agreement.
• The court affirmed that Extell and all its successors are bound by the terms of the Restrictive Declaration.

Footnote: What should Extell have done? Continued to cooperate with RSPC, and signed an agreement extending their relationship. It would have been a real demonstration of ethical behavior, and would have been most welcome.

Community Group: Extell Must Honor Restrictive Declaration

The Committee for Environmentally Sound Development has been working to "end endless growth" for at least the last 17 years. They just issued their December, 2009 newsletter, and devote a good portion of it to the southern portion of the Riverside South development.

The article provides a sound analysis of the current situation.

After reviewing the background, including the 1992 Restrictive Declaration that limits development on the site, the newsletter says:

It is south of 61st Street that the developer Extell wants to deviate from the 1992 agreement in order to increase density. Considering that the 1992 agreement was overly generous to development at the expense of park area this request should be unequivocally denied.

While agreeing (as everyone does) that the original plans calling for a TV studio need to be changed, the newsletter points out that:

A substitute is necessary that is not residential housing. ... The lot at 59th and West End Avenue is directly above the Amtrak Railroad and a station at that point would add to our mass transit capabilities. A ferry terminal at 59th Street and the Hudson River would encourage New Jersey residents to commute by boat instead of cars. Placing a park between these two facilities would be a delight for the neighborhood. ... the west end of the lot [could] be used as a garage for the Sanitation Department ... with a park above.

The article concludes:

If Extell can not be persuaded to adhere to the square footage set in the 1992 Agreement, then the need is great enough for the City to use the power of eminent domain to obtain this last bit of undeveloped space for a public purpose.

You can contact the Committee for Environmentally Sound Development at 212 877 4394 or Elfreud@aol.com. Consider sending a donation to support their work. The address is PO Box 20464, Columbus Circle Station, New York, NY 10023-2678.

Elected Officials Say the Restrictive Declaration Is In Force

Since 1992, the developer of Riverside South has been bound by a Restrictive declaration. In December 2008, our elected officials wrote a letter that states that the Restrictive Declaration is still in force. When push comes to shove, we hope they will maintain this position.

The letter was to the New York City Commissioner of Parks and Recreation. The main subject was the park on Riverside South, but in the course of discussing the issue at hand, they state that the 1992 Restrictive Declaration still controls the development that can take place on the property.

The effectiveness of the Restrictive Declaration is important because Extell, the current developer, is trying to put up buildings that way exceed the limits in the declaration, and is in other ways evading controls and limits that have been in force for nearly 20 years. Here is a post that goes into the subject in more detail.

Here is the header of the letter:

Here is the key sentence:

Here are the signatures:

 

Congressman Jerrold Nadler, Senator Thomas Duane, Assemblywoman Linda Rosenthal, and Councilwoman Gale Brewer: THANK YOU for standing up for us and confirming that Extell is still bound by the terms of the 1992 Restrictive Declaration. Extell is currently preparing plans that go way beyond the limits of that declaration in terms of density and other factors. When the time comes to act, we hope you, along with Amanda Burden, the head of City Planning, will put a stop to this excessive development.

Extell, Riverside Center and the Restrictive Declaration

Gary Barnett's Extell Development and their financial partners for Riverside South, the Carlyle Group, are proposing a development they call Riverside Center (sites L, M and N of Riverside South) that exceeds the limits set by the Restrictive Declaration governing development on the property. In total, they are asking for more than a 30% increase in the already-too-large limits they have.

Community Board 7 has done an analysis of the differences and made them available. The full document is on-line.

The first and most important number is Total Square Footage.

• Original: 2.37 million Square Feet
• Proposed: 3.1 million Square Feet
• Difference: + 730,000 Square Feet

One of the most interesting things we have learned recently, from the Coalition for a Livable West Side, is that space was "borrowed" from the allocations for sites L, M and N and used for other buildings in Riverside South! This is a legitimate practice, but only if you subtract the space you've used from the original allocation, which does not appear to have been done in this case.We hope to make this analysis available soon.

The other dramatic change is in Residential Square Footage.

• Original: 572,192 Square Feet
• Proposed: 2.55 million Square Feet
• Difference: + 1,977,808 Square Feet

What this amounts to that they want to build about 2,500 condos in the small two block area, using a design from a famous architect but a design that is nonetheless seriously flawed. In addition, they want to build a hotel, a car dealership and 1,057 more parking spaces than were originally allotted. Too much!

Respect the Deal on Riverside South

Donald Trump may have written The Art of the Deal, but as the community learned at a neighborhood forum on October 8, 2009, this does not necessarily mean that the deal entered into between the City, Trump and the community regarding Riverside South will be respected. Today, Extell Development Corp and The Carlyle Group, not Trump, own the land, and have proposed a massive development that doesn’t simply renege on the deal – it mocks it.  As Ethel Sheffer, a planner by profession and Community Board 7 member, explained at the forum, the original deal, or Restrictive Declaration, envisioned a modest number of housing unit, a TV studio and a park on the site to allow easy access to the Hudson – and called for a school to be built. Today, everyone agrees that there is no need for a TV studio. But the restriction on density, the requirement for open space that creates access to the River and the building of a school are all as relevant today as they were in 1992.  If anything, all these things are MORE relevant today, given the amount of development in the neighborhood.  Simply put, the City should require Extell and Carlye to respect the deal.

Ethel Sheffer and Helen Rosenthal, the outgoing Chair of CB7, explained that CB7 has hired its own consultants to help develop an alternative development plan. This plan should be released in next week or so and is the subject of a CB7 meeting on October 27 at 6:30 that we urge the community to attend.

Ethel and Helen also explained the decision-making process regarding the Extell/Caryle proposal.  It is currently in the “pre-certification” stage, before the formal environmental review process. As Ethel said, “the pre-certification process is where a lot of key decisions/changes are made” and it is therefore critical to get involved and express concerns and alternatives now.

The meeting was well attended both by residents and elected officials. City Councilwoman Gale Brewer, and staff members from her office, as well as those of State Assemblyman Linda Rosenthal and State Senator  Tom Duane, came and heard the concerns of the community.  Please reach out to them and let them know that you think whatever is built on this last remaining undeveloped parcel on the Hudson River should be consistent with the deal that was so hard fought by the community.

This was written by Anne Weisberg, 10 WEA Riverside Committee