Union, City Sew Tentative Deal on Garment District Future

It’s been 22 months since City Planning chairwoman Amanda Burden declared before a Crain’s midtown breakfast forum that the city, within a month, would reveal a plan to rezone and revitalize the 13-block garment district north of Penn Station.

No such unveiling ever came, as the Bloomberg administration struggled to craft a proposal that satisfied an array of industry and interest groups involved in the district. For months, many involved thought the plans had been dropped in the face of irreconcilable discord.

But now, those involved say the initiative has come back from the dead—or at least out of hibernation—as the city has cut a deal with key union UNITE HERE, according to city and union officials. Though some barriers remain, consensus appears within grasp for the historic rezoning, which would provide for far more office space and reserve substantially less space than currently mandated for fashion production.

The agreement with UNITE HERE, which represents workers in the apparel industry, speaks to the political complexities that surround land use and zoning in New York, as the agreement ties together two seemingly disparate issues: hotel production and the garment industry.

Much of the union’s membership is not garment workers but rather hotel workers, so in exchange for its support, the union, led locally by Peter Ward, pushed for a mechanism that would likely encourage a unionized workforce in area hotel development. As such, the Bloomberg administration says it has agreed to mandate a special permit for any new or converted hotels in the district, a step that would require approval from the Planning Commission and the City Council. Given Mr. Ward’s sway among council members—his union is generally considered one of the city’s more powerful—hotels needing the council’s approval are likely to agree to steps that allow for easier unionization.

“The special permit provision is an important piece of the puzzle,” Andrew Brent, a spokesman for Deputy Mayor Robert Lieber, said in a statement. “That said, we still have work to do on developing a plan that balances the needs of the varied garment district stakeholders, spurs investment in the area, and keeps New York City the fashion capital of the world.”

Assuming the deal holds, it removes the main and largest potential opposition to the plan, the garment workers. Still, other groups, including the existing property owners and fashion designers, do not yet support the plan, as they haggle with the Bloomberg administration over the details of the rezoning, with a design industry group pushing for more production space than the city has offered.

The zoning plan would alter a 21-year-old set of landowner requirements within the garment district, which is bounded by Broadway and Ninth Avenue, and 40th and 34th streets. The existing zoning has strict regulations to preserve fashion production space. Any landlord wishing to convert existing fashion production space to offices must create an equal amount of production space elsewhere in the district. (Rents for fashion production space are a fraction of Class A or B office space rents.)

THE AREA'S LANDLORDS complain that a decades-long exodus of city-based fashion producers has left far too few fashion tenants to fill their buildings under the current requirements.

The city’s plan would change the ratio of office-space conversion to production-space preservation from the current 1:1 to one that favors far more office space, perhaps creating millions of square feet of newly permissable space. (A major goal, the city has said, is to allow for more Class B and Class C office space in midtown, as the high rents of Class A space have pushed many firms outside of Manhattan.)