Report: St. John’s project could go commercial, with no air-rights transfer

A typical scene at Pier 40 in Hudson River Park includes droves of young athletes and parents streaming to and from the pier’s artificial-turf sports fields. The trapeze has relocated to Williamsburg. File photo by The Villager
A typical scene at Pier 40 in Hudson River Park includes droves of young athletes and parents streaming to and from the pier’s artificial-turf sports fields. The trapeze atop the pier recently relocated to Williamsburg, though. File photo by The Villager

BY LINCOLN ANDERSON | The majority owner of the St. John’s Center reportedly is rethinking its idea of building a mostly residential project because the housing market is starting to weaken, Crain’s New York Business reported on Friday. Instead, the developers are considering an office / commercial scheme — which, as opposed to the other option, would not need a rezoning — as a “backup plan,” Crain’s said.

The news seemingly casts some doubt on the future of Pier 40 and its beloved ball fields — plus nearly 500 units of affordable housing that were pledged as part of the St. John’s Partners plan.

Westbrook Partners is currently in the midst of a ULURP (Uniform Land Use Review Procedure) application for a zoning change to allow it to build a 1.7-million-square-foot project on a three-block stretch of West St. across from Pier 40, at W. Houston St. The site currently has a manufacturing zoning, which allows office use and hotels, but not residential.

The breakdown of the space would be 1.3 million square feet of residential and 400,000 square feet of commercial. About 30 percent of the apartments would be affordable. There would be 1,586 units, 476 of which would be permanently affordable, with 175 of those slated for low-income seniors. The rest of the affordable units would be earmarked for low- and moderate-income families.

As part of the project, Westbrook has committed to buy 200,000 square feet of air rights from Pier 40, for which it would pay the Hudson River Park Trust $100 million — money that, in turn, would be used to repair the crumbling Pier 40, Downtown community’s youth sports mecca.

The existing 1.2-million-square-foot St. John’s building — the original 1930s terminus for the High Line freight railroad — would be razed to make way for the new construction.

According to Crain’s, Westbrook is now searching for a partner for the project, the whole direction of which could radically shift.

“Westbrook Partners is working with Adam Spies, a broker at Eastdil Secured, to find a developer that would invest in and help oversee construction of the project to revamp St. John’s Terminal…,” Crain’s reported.

Last year, Westbrook acquired a stake in the property that was held by Fortress Investment Group for $200 million. Atlas Capital Group still holds a minority stake in the building.

“But as Westbrook increased its hold on the property and laid plans to redevelop it,” the Crain’s article continued, “the city’s residential market has appeared to weaken, dealing a potential blow to its plans to transform the site predominantly into residential space. Sales of high-priced condos have slowed and 421-a, the leading incentive program to build rental housing, has lapsed. Those hurdles have prompted Westbrook to consider an office-focused redevelopment as a backup plan — a change that would likely scuttle its deal to buy Pier 40 air rights, a source said.

“If Westbrook succeeds in getting the site rezoned, it may proceed with that proposal,” Crain’s said of the original proposal. “But if the firm is unsuccessful with the rezoning or decides the residential market has weakened too much to proceed with building apartments, it could instead build roughly 1.4 million square feet of commercial space [without a rezoning]. Brand-new office space aimed at creative tenants and tech firms has leased briskly in recent years.”

Image courtesy COOKFOX A rendering showing what uses are planned in the St. John’s project. A rendering of Ian Schrager’s planned wave-shaped building, 160 Leroy St., which is not yet under construction, is shown just north (to the right) of the St. John’s project.
A rendering showing what uses are planned in the proposed St. John’s Partner’s project, which would have 1.3 million square feet of residential space, with about 500 affordable apartments. As part of the project, the developers would buy 200,000 square feet of air rights from the Hudson River Park’s Pier 40, at right.

In June, in the first step of the ULURP process, Community Board 2 overwhelmingly approved the St. John’s Partners project plan — though with a number of suggested changes, such as calling for the project’s massing to be shifted toward its center.

But last month, in the ULURP’s second round, Borough President Gale Brewer gave the project a thumbs down, saying, “I firmly believe we can do better with this site.”

In turn, Villagers and Downtowners turned out in numbers at a hearing last month at the Department of City Planning, which is now considering the application in the third review stage of ULURP. As opposed to C.B. 2 and the B.P., City Planning’s vote on the project is not advisory but binding — as would be the City Council’s vote in the review’s last step, assuming the current project isn’t scrapped and the ULURP application does get that far.

Asked for comment on the Crain’s article, Tobi Bergman, chairperson of C.B. 2, expressed skepticism that the developers aren’t simply just angling for more favorable terms.

“Anything is possible, and if they want to build an as-of-right project [without a zoning change], obviously they can,” Bergman said. “But to me this seems like the ‘We-don’t-need your-stinking-approvals-anyway’ bluff that we see all the time. Investors are normally more savvy about trends than to engage in a huge ULURP for a project that will take a decade or more to develop and then say, ‘Oh, heck, the market has changed, let’s do something else.’ It is quite likely they will bring in a developer partner, but my guess would be they still want to build the larger mostly residential project.”

If the housing-based plan indeed does fall through and the deal to buy air rights from the park is then dropped, Pier 40 would once again be left in the lurch, without sufficient funding to fix its badly corroded steel support piles. The idea of that possibility is a huge concern to local youth sports leagues.

Michael Schneider, the new president of the Greenwich Village Little League, stressed that the city itself should be footing the funds to save the ailing pier — the implication being that the fate of such a key recreational facility as Pier 40 should not be hitched to the whims of a fickle real estate market.

“I can tell you that it is a shame that the city doesn’t take a more active role in funding the costs for the Pier 40 project,” Schneider said. “It’s not as if they haven’t funded many other parks, including Governors Island for over $300 million.

“Most organizations that have spoken out in support of the [St. John’s Partners] proposal aren’t thrilled with the project as put forth, but would almost sell their soul to save Pier 40. The loss of that pier would cripple Downtown athletic fields that make it possible to play football, baseball, softball, lacrosse, soccer, boating and kayaking, not to mention the pier is a base for school athletics at Stuyvesant High School.

“A neighborhood like ours prospers because of families and children,” Schneider said, “and without places for kids to play and grow, young families will look elsewhere. It is in the city’s best interest to make sure the Lower West Side of Manhattan continues to develop areas like the esplanade and the ball fields at Pier 40. The Hudson River Park Trust has been incredible — but for goodness sake, give them a helping hand.”

City Councilmember Corey Johnson gave a tough statement on the St. John’s Partners project at last month’s City Planning hearing, clearly sending a message that it won’t sail through the Council’s portion of ULURP review without modifications and concessions. However, on Friday, Johnson said the developers are “still committed” to the residential plan.

“I spoke with the applicant after the [Crain’s] story appeared and the applicant indicated to me that they are still committed to proceeding with the project,” Johnson told The Villager. “I take them at their word.

“Their concerns include the weakening of the residential condominium market and the lack of 421-a for the rental portion of the plan. I am committed to achieving an outcome that brings emergency repair funds to Pier 40 and desperately needed affordable housing to my district.”