Garment District 2021: The Latest Trend in Gentrification

BY JASON SLOTKIN and SCOOBY AXSON

The future of the Garment Center looks a lot like 250 West 39th Street, a building that was nearly half empty four years ago. Like many buildings in the Garment District, the 18-story building once housed factories where garment workers toiled away on sewing machines and over work tables. These days about 10 percent of the occupants are engineering, public relations and other firms that have transformed the vacant Garment District open spaces into offices. It’s where the Thinktank marketing firm works promoting their clients including Lady Gaga and comedian Kevin Hart.

The standard gentrification scenario involves new firms supplanting old businesses, drawn by cheap real estate. But 250 West 39^th Street is still brimming with fashion-related companies, including designers and brands like Anna Sui and L’Koral Inc.,according to Tarter Stats O’Toole, the real estate firm that manages the building.

Gentrification in the garment district doesn’t look like gentrification elsewhere in the city: Even as new businesses make it a more tourist- and leisure-friendly district, several forces are at work, pushing to ensure that the Garment District remains New York’s fashion capital. Over the past few weeks, we’ve looked at the variables shaping the Garment District’s future, using one block on West 39^th Street to predict how the the neighborhood will look in 2021.

Sixty-one percent of garment manufacturing jobs in New York have disappeared over the past decade. Hotel and apartment development have brought leisure businesses such as restaurants and bars to the neighborhood, and are now renting out nearly half of the retail spaces that were vacant a year ago. But, fashion — the core $55 billion a year business, according to a NYC Economic Development Corporation fact-sheet — is there to stay.

 

Market Forces

Twenty years ago, the Garment District was a ghost town on weekends.  Today, it’s home to restaurants, hotels, and public space projects meant to beautify the streets.

“If you go back 20 years ago, this is where people parked on weekends,” says Jerry Scupp, deputy director of the Fashion Center Business Improvement District. “Now people are coming and walking around.”

Scupp says that the Garment District is on its way to becoming a weekend destination. In its 2010 profile of the district, the BID predicted a continued growth of weekend visitors and non-fashion retailers like restaurants and bars. Within six years nearly twenty hotels have popped up or are under development, now that parts of the neighborhood have been rezoned to allow the lodging industry to settle in New York’s fashion center.

Above the ground floor, much of the commercial space is a mix of both fashion and non-fashion firms. The past decade’s exodus of clothing manufacturing from New York has left large loft spaces in many buildings  — spacious offices at prices that are on average $10-20 less per square foot than most other commercial real estate in Midtown.

But Catherine O’Toole, a vice-president at Tarter Stats O’Toole, says that fashion remains a major renter at the nine Garment District buildings her firm manages.

“I think the Garment Center is always going to be the Garment Center. You’re not going to see fashion moving from this area…its grassroots are here, ”said O’Toole.

Jerome Chou, project director of the Design Trust for Public Space, a non-profit group that conducts studies into urban design and planning issues, said the Garment District is full of vacant space, leaving room for both the old and new types of occupants. “What we’re finding is that there’s room in the neighborhood for all of those things to exist,” said Chou.

Zoning

A complex set of 50-year-old zoning laws, amended in 1987 and earlier this year, need to stretch even further to accommodate both new businesses and Garment District manufacturing.

Current zoning regulations in the area require any landlords converting properties to office space to also create equal amounts of production space for fashion somewhere else in the Garment District – an easing of the old standards, which said landlords must rent the majority of commercial space to apparel-related businesses. New businesses move in as existing garment industry business owners express concerns about the shrinking neighborhood.

There is no simple answer to what the area will look like in 10 years. The city scrapped a plan that would have taken nearly 10 million square feet of space used for manufacturing in the roughly 13-block radius of the Garment District and reduced it into a single 300,000 square-foot building on 38th Street.  New York City Planning Commissioner Amanda Burden said the city is constantly modernizing the zoning resolutions to meet current needs and address the economic, physical and environmental issues of the city.  She said redoing the current laws may take 20 years because everyone, including administrators, business owners, and residents have to be in agreement.

“It is important to reflect on our history and brainstorm about the next challenges facing New York City and debate how zoning can be used to address them,” Burden said.

Vin Cipolla, the president of the Municipal Art Society of New York, a non-profit organization designed to look at issues of neighborhood preservation, design and elements of urban planning, said that New York, especially unique neighborhoods like the Garment District, is in need of new zoning regulations. He admits that it will be a “significant undertaking that must be handled outside of the usual political and bureaucratic framework.”

Over the next decade, the Art Society recommended dividing the garment district into five sub-regions:

Zone A&B -West 35th and West 40th streets between Seventh and Eight Avenues will include more theaters, galleries and nightclubs. Residential space is not appropriate for this area because the buildings in the area are more suitable for commercial use.

Zone C  – West 36th -39th streets, Broadway and Seventh Avenue will include almost 20 percent of all the total showroom space in the entire district. Lifting zoning restrictions would allow for more Class C, or low-rise, buildings.

Zone D – West 36th-41st streets, Sixth Avenue and Broadway and Seventh Avenue. Post-war buildings reach as high as 42 stories high, making for maximum room for manufacturers. There is no immediate need for re-zoning in this area.

Zone E – Areas east of Sixth Avenue.  Lots in this area are smaller and less expensive. In the future, zoning would restrict the height of walls facing the street and maintain the light-manufacturing district.

Donald Elliott, author of ”A Better Way to Zone”, thinks the city needs to allow more buy right development, the term given to property owners reusing buildings without an environmental review or city intervention. He said there are some fundamental problems with the ordinance, which he thinks needs to be disposed of entirely.  “The city needs to set the rules right. There are places in the city that deserve intense scrutiny and some that don’t,” he said.  Elliott said many cities around the nation are integrating environmental control with zoning and that the district needs to stop having “right hand, left hand bipolar tension” among zoning, environmental and sustainability.

Mitchell Silver, a chief planning and economic development officer who helped turned Raleigh, N.C.’s zoning around, agrees with Elliott but also thinks the Garment District’s code is simply outdated.

“The zoning code is like a boomer, and it’s time to go on to its next life and make room for the next generation, which really is about innovation,” he said. Silver suggests incorporating some of the zoning code into the different building codes. He said zoning is intended to protect the public health, safety and welfare, a function that is better suited to buildings.  “I think the zoning code tries to do the wrong job.”

As recently as 2007, the Garment District’s zoning resolution was close to being overhauled as business owners, tenants, and landlords took their gripes to the city. If a small business owner tried today to establish a business in the area, they would have to move from mass-producing products to areas of specializing where they could gain a competitive advantage.  Most small businesses owners don’t have the capital to concern themselves with those types of logistics.  The current zoning code dictates space limitations, rent depression, and even what businesses can be located on certain streets.  Philip Howard, a former board member of the art society, said that in the next 10 years the Garment District is not likely to change as the language in the zoning statutes continue to confuse and the legal infrastructure that governs it is in a shambles.

 

The Human Forces

New York is full of neighborhoods whose core and sometimes namesake businesses – like the Meatpacking District – are long gone, driven out by the forces of gentrification. But several groups and individuals took notice when apparel manufacturing began to leave the Garment District.

Stephen Tarter, a founding partner at Tarter Stats O’Toole, says he hasn’t seen a movement that “legislates” the fight against gentrification like the one in the Garment District. A long time real estate broker in Soho, Tarter saw first-hand how efforts to save Soho failed.

“There were never any legislation, movements, or policy or anything that aimed in a certain direction,” said Tarter about Soho. Unlike, Soho, Garment District residents have been putting studies together to create a guide to sustain the neighborhood’s fashion identity.

The Garment District has a secret weapon to protect its core industry: the industry itself. Many fashion elites still maintain offices and showrooms and lend their names in the fight to protect a centralized fashion district in New York. Designers like Diane Von Furstenberg and Nanette Lapore have lent their names to campaigns like Save The Garment Center. Some of these campaigns have yielded promotional merchandise and studies emphasizing the neighborhood’s importance to the fashion industry.

“That cluster has disappeared essentially,” said Chou at the Design Trust, referring to a phenomenon where every aspect of a business – in this case, fashion – exists in a single neighborhood, and sometimes even in a single building.  With the exodus of factories, and despite zoning codes meant to create the opposite effect, the Garment District’s focus has been diluted. Chou says the Design Trust is now working on ways to “tweak” zoning to both “protect factories” and maintain property value for building owners.

To preserve the cluster and fashion’s future in the neighborhood, the Design Trust partnered with the Council of Fashion Designers of America,a trade organization for high-end fashion designers,  to create the Made in Midtown project about this group effectively putting together a comprehensive view of the history and industries of this district. According to Chou, the group studied not just the history and changes in the neighborhood but the centralized nature of the district itself – where manufactures, designers, and wholesalers would share a building or block –as an industrial model for success in the industry.

The next step is to ensure the future of fashion in Garment District. “In terms of the industry itself, I couldn’t tell you what the next five ten years will bring,” said Chou. To address this uncertainty, the Design Trust is evaluating the neighborhood to look for ways to maintain a fashion industry presence and restore the cluster model, and will present their findings to the city this spring.

This entry was posted on Tuesday, November 22nd, 2011 at 8:46 pm. It is filed under Garment District, Uncategorized and tagged with manufacturing, showrooms, zoning. You can follow any responses to this entry through the RSS 2.0 feed.