East River Redevelopment Site
In 2002, Consolidated Edison sold its 9.2 acre site on Manhattan’s East River for $680 million to developer, Sheldon H. Solow. The site, which stretches from 34th to 41st Streets along the East River, was home to a now-defunct steam power plant. In 2004, Solow paid $100 million to demolish the substation. Solow’s East River Realty Company (ERRC) has joined with the Fisher family to create a new firm, the FSM East River Associates, to develop the site.
The ERRC originally proposed a 6.1 million square feet mixed-use development with several towers ranging from 528 to 864 feet tall, including a 1.5 million square feet office tower, 70,000 square feet of retail space, and six residential buildings with 4,173 units. The plan also includes 5 acres of open space. Richard Meier and Skidmore, Owings, and Merrill Architects designed the proposed complex.
Several parties initially opposed the plan. Manhattan Community Board 6 (CB6), local elected officials, and community residents expressed concerns about building heights, which substantially exceed the nearby 505 feet high United Nations Secretariat Building, and the extensive commercial and retail space, thought to be out of character with the neighborhood. Both Manhattan CB6 and Borough President Scott Stringer recommended that the ERRC’s plan be disapproved by the City Planning Commission (CPC) and City Council. The CPC, however, voted to approve the plan in January 2007, paving the way for the City Council to review the plan and make a final determination. As the plan moved through the City’s public review process, the Uniform Land Use Review Procedure (ULURP), several modifications were negotiated during contentious public hearings. In March of 2008, the City Council voted to upzone the manufacturing site for mixed-use development and approved the revised plan, which included many concessions by the developer.
The revised plan of the seven proposed towers reduces building heights dramatically, with the tallest tower to reach 595 feet. The trimmed-down plan also reduces total residential units to 3,000, cuts parking spaces by more than 33% to 400, and removes 500,000 square feet of office space. The plan was also negotiated to include affordable housing, a waterfront park, and a new public school slated to open in 2012. Solow has committed $10 million to developing the waterfront park for the neighborhood which will include an open-air performing arts space. Some of the 579 residential units designated as low- to middle-income housing will be represented in the new construction. The remaining affordable unit requirements will be fulfilled by ERRC’s support for preservation of existing units in the surrounding neighborhood. These measures seek to preserve the neighborhood’s original middle class roots and character.
Several residents of the Tudor City neighborhood continue to oppose Solow’s renegotiated plans because of the belief that the development may block their East River views, cast shadows, and spread dust and noise during construction. Tenants of one of the nearby buildings filed a lawsuit to block Solow’s development in the spring of 2008, just after the City Council approved the renegotiated plan. The revised plan reduces the building adjacent to Tudor City from 721 feet to 462 feet high and reorients two additional proposed buildings. These changes would significantly reduce shadows imposed by the new development on St. Vartan’s Park and the landmarked Tudor City Greens. According to an April 2008 AM New York article, Tudor City residents view the Solow development as antithetical to their hard-fought landmark status and continue opposition through the lawsuit despite the developer's concessions.
Despite the faltering economy, Solow received a substantial boost from an October 2008 court decision to allow massive tax credits totaling $250 million for development on the site. As a brownfield site, Solow will receive tax credits under the New York State Brownfield Cleanup Program (BCP) for site remediation and cleanup. The Department of Environmental Conservation (DEC) contended that Solow should be subject to the $35 million brownfield tax credits cap adopted under former Governor Eliot Spitzer but a judge riled that the site is eligible for limitless tax credits because the project has been in the works for many years. The DEC’s argument was founded on the fact that this rare and attractive waterfront site in Manhattan would have been developed with or without the BCP credits. The New York Supreme Court found this qualification to not be present in the BCP legislation and ruled in favor of Solow. The Supreme Court’s decision is currently being appealed by the DEC.
Despite this win for Solow, new troubles for the development loom. In December of 2008, Citibank filed an $85 million lawsuit against Solow, claiming that the billionaire developer had defaulted on a $67 million loan payment and an $18.5 million payment on a letter of credit by lacking adequate unencumbered assets and cash flow. In 2004, Citibank had issued a $490 million letter of credit with various stipulations to support development. Solow claims that Citibank mismanaged the collateral and insists their charge of default is invalid.
Building plans have yet to be submitted and the site continues to lie vacant.
Last Updated: October 5, 2009