NEW YORK — It’s New York City’s biggest development setback since the deal to bring Amazon’s headquarters to Queens flopped last year — and the latest victory for New York’s ascendant left.
The Industry City megaproject — a planned repurposing of a former industrial area on the Brooklyn waterfront — weathered relentless community opposition as it worked through a very public, very political approval process. After years of delay, the project was closer than ever to moving forward, even as the coronavirus pandemic halted nearly every other major construction effort in New York.
Then Reps. Nydia Velázquez and Hakeem Jeffries (both D-N.Y.) got involved. In the era of Rep. Alexandria Ocasio-Cortez and a slate of progressive upsets in local races, Democrats in New York are increasingly wary of challenges from the left. The lawmakers opposed the development, touted to generate some 15,000 jobs and $100 million in annual tax revenue, on the grounds it would hasten gentrification and raise rents in the working-class neighborhood.
The project’s fate was sealed when Velázquez began corralling other opponents to lobby against the plans, four sources with knowledge of the events said. The developers pulled the plug on Tuesday, six years after launching the undertaking, citing the growing political opposition and the absence of a champion in City Hall.
The outcome for Industry City reflects the growing influence of the Democratic Socialists of America, whose south Brooklyn chapter opposed the project’s approval. The trend has sitting politicians in some sections of the city worried they’ll face tough primaries if they don’t appear adequately aligned with left-leaning groups.
“It’s pure politics, which we can’t afford right now,” said Kathy Wylde, head of the influential business consortium, Partnership for New York City.
Developers were seeking a zoning change to expand the waterfront complex and allow more businesses, retail and academic space at the site. They were making the case to the City Council that the expected benefits merited the plan’s approval over the objection of local Council Member Carlos Menchaca, who would otherwise be given veto authority under the Council’s traditions. The argument seemed to have more weight as much of the city’s development has frozen amid the Covid-19 pandemic and New York stares down a steep drop in tax revenue.
But the path forward became shakier as Council Speaker Corey Johnson and Mayor Bill de Blasio remained largely absent from the debate, people familiar with the discussions said. And a letter sent to Council members Tuesday from Brooklyn’s congressional delegation and several state lawmakers — who argued the project would accelerate gentrification and displacement in the neighborhood — reflected growing opposition from powerful political players.
Industry City CEO Andrew Kimball said Thursday the “lack of interest at all levels, but particularly at the City Council, in engaging in a constructive dialogue” on the substance of the proposal contributed to the decision to scrap the rezoning.
“It’s hard in a process like this when you don’t have somebody on the other side who seems eager, willing to come to the table to negotiate a plan,” he said on a call with reporters. “That became very clear, that there wasn’t that willingness.”
The left’s efforts on fighting gentrification already had real political consequences for establishment Democrats. In Sunset Park, longtime Assemblymember Felix Ortiz lost the seat he’d held since 1994 to newcomer Marcela Mitaynes, a tenant activist and vocal rezoning opponent, this past July. De Blasio recently backed out of a new plan for the former Amazon site in Queens over concerns about a lack of community investment.
Kimball said he heard frequently from politicians through the rezoning process that, while they liked the substance of the proposal, they couldn’t support it given the politics of the moment.
Velázquez recruited other members of Congress to sign the Tuesday letter, including Jeffries and Yvette Clarke, both of whom represent neighboring districts, according to two of the sources. Jeffries, who is considered a moderate Democrat and has risen the ranks of House leadership, raised eyebrows as one of the signatories.
“It was kind of the nail in the coffin,” said one Council official who, like other sources in this story, requested anonymity to discuss the sensitive subject. “The electeds in Brooklyn lean on him and his voice is very powerful. He’s a common sense elected official, he’s not far left, so when he speaks, people listen and follow.”
Jeffries’ opposition came despite support for the project from many of his political allies, including clergy members and other central Brooklyn elected officials, according to a Brooklyn political consultant who asked to remain anonymous.
“Now [Jeffries and others] have to go back and answer to these community members, predominantly Black ones, who are like, ‘Why would you do that?’” the person said.
Johnson, the City Council speaker who until this week was considering a run for mayor, remained noncommittal as discussions on the project continued. On Wednesday, he noted the widespread opposition to the plan from local elected officials, saying Menchaca “had a united front.”
“The developer was not able to make the case or convince, not just the elected officials who represent the area, but a broader set of elected officials in the borough of Brooklyn,” Johnson said at a press conference. “If you can’t convince the local elected officials then that tells you where things are going to go. I don’t think it’s appropriate to think that I’m going to jump in and say that I know better than every local elected official.”
De Blasio, meanwhile, repeatedly declined to get involved when asked about the plan in recent weeks. The mayor, also a Democrat who ran as a progressive, has largely stepped back from his development agenda, once a core focus of his mayoralty.
The Council generally defers to the position of local members on land use projects. However, after Menchaca announced his opposition to the project in late July, other Council Members urged the body to support the proposal anyway. Council Members Ritchie Torres and Donovan Richards wrote a New York Daily News op-ed arguing the Council’s member deference tradition shouldn’t doom a project that could generate thousands of jobs during an economic crisis.
The op-ed angered Velázquez, and her involvement grew as she sensed the project may pass over Menchaca’s opposition, two sources said.
A spokesperson for Velázquez did not make her available for an interview.
“The Congresswoman got involved because members of the local community were alarmed this massive rezoning was being rushed through and would have accelerated displacement during an economic crisis that is already disproportionately harming working immigrant families,” spokesperson Alex Haurek said in an email.
Menchaca and Sunset Park activists who opposed the rezoning declared victory after POLITICO first reported this week, the developers were pulling the application.
“[Industry City] attempted to use their money and influence to circumvent the community-backed position and win over Council Members,” Menchaca said in a statement on Wednesday. “Despite these efforts to divide the community and the Council, they couldn’t defeat the power of the people coming together to protect their neighborhood.”
“This is sending a message to elected officials and developers that development can no longer look like this,” said Elizabeth Yeampierre, executive director at UPROSE, a local environmental justice group that fought the plans.
Business and civic leaders, as well as politicians who supported the project, lamented the fate of the rezoning.
"I thought more weight would have been given by elected officials to the economic circumstances we’re in,” said James Whelan, president of the Real Estate Board of New York. "We have unemployment approaching the Great Depression, we and others are issuing reports every month that demonstrate how private investment is shrinking in New York City…That whole issue just seems to have been thrown to the wind here."
Sally Goldenberg contributed reporting.