NYCEDC Announces New Office Anchor Strategy to Create Space for Jobs Outside Central Business District
City Agencies Will Move Offices to Serve as Anchor Tenants for New Commercial Development
Human Resources Administration to Relocate up to 250,000 SF to East New York, Anchoring Development That Will Provide Space for Hundreds of Private Sector Jobs
Brooklyn BP Adams Has Championed Office Anchor as Strategy to Revitalize East New York
New York, NY - New York City Economic Development Corporation (NYCEDC) President and CEO James Patchett today announced that, as part of the City’s soon to be released 100,000 jobs plan, the de Blasio administration will be launching a new strategy for creating much-needed office space in emerging and potential business districts around the city.
Through this strategy, City agencies will serve as anchor tenants for new commercial developments in targeted neighborhoods that have demand for more office space but have a hard time attracting the type of larger tenant necessary to anchor a new building. The office anchor strategy is also intended to help the City plan for future space and tenanting needs in a cost-effective manner.
The strategy will focus on places such as Downtown Brooklyn and Long Island City where commercial growth has been priced out by residential development. It will also support more nascent commercial hubs such as Harlem, Flushing, and Jamaica, as well as neighborhoods with untapped commercial potential, including East New York.
President Patchett also announced that the City’s Human Resources Administration (HRA) would serve as a first mover. HRA will anchor one or multiple new developments in East New York, taking up to 250,000 square feet of office space. Not only will HRA’s tenancy provide new space for local businesses looking to grow and create jobs, but it will also free up office space currently occupied by HRA in higher demand areas of the city, thereby delivering additional space for private use.
NYCEDC will be releasing a detailed RFP for an East New York development later this summer and will be working in the months ahead to identify additional agencies with interest in relocating their operations to other parts of the city.
Locating a City agency in East New York has long been a priority for Brooklyn Borough President Eric L. Adams. He has been a leading champion for this urban planning strategy as part of his vision for the revitalization of Broadway Junction, encouraging the City to utilize its tenancy as a strategic development tool.
“Right now, we see growing demand for office space outside the city’s central business district,” said NYCEDC President and CEO James Patchett in his remarks. “Local entrepreneurs want to stay in their current neighborhoods close to where they and their employees live, but there are limited options for new or quality workspace. That’s where we come in. City government is one of New York’s largest private office tenants – with a leased portfolio of over 22 million square feet, much of it in high-cost and high-demand neighborhoods. So the City of New York is committing to use agency moves to anchor multiple new commercial developments over the next decade. This strategy has the potential to create millions of additional square feet for growing businesses, which will provide space for thousands of new jobs.”
“When we can serve New Yorkers and spur strong commercial development at the same time, that’s a win-win,” said Deputy Mayor for Housing and Economic Development Alicia Glen. “We are looking for smart ways to use our footprint to generate the new commercial space that companies need to create good, middle class jobs.”
“The work we do at HRA - preventing homelessness and providing vital public benefits - is a key part of keeping New York City neighborhoods strong,” said Department of Social Services Commissioner Steven Banks. “It only makes sense for us to use our role as an employer and consumer to further that mission, and help spur economic growth in neighborhoods that need it. We’re proud to be a part of this initiative.”
“Two years ago, I first proposed a large-scale opportunity to create much-needed office space in Downtown Brooklyn while concurrently seeding a community-focused economic rebirth of Broadway Junction, an under-utilized transportation hub at the gateway to Cypress Hills and East New York,” said Borough President Adams. “Through meaningful dialogue with City Hall and NYCEDC leadership, we have arrived at a momentous juncture where this proposal can take root as a concrete plan that grows quality jobs for Brooklynites. My administration looks forward to working with Mayor de Blasio and NYCEDC President Patchett on smart long-term siting of City agencies in our borough.”
“While the unemployment rate nationally has been steadily decreasing, Brooklyn’s rate of unemployment has consistently remained above the national level and in East New York unemployment is in the double digits-- as high as 11% in 2015,” said Council Member Rafael Espinal. “Through the East New York Neighborhood Plan we built a strong strategy to increase affordable housing, improve our infrastructure and create jobs. I am pleased to see the NYCEDC building upon this work and thinking outside the box to tap into the great potential in our community. I thank President Patchett for this vision and look forward to working with EDC on its implementation.”
East New York is seeing tremendous investments by both the City and private development. Those investments are currently focused on new housing, much of which is affordable; however, there are many factors that make East New York attractive for new and growing businesses, including:
- A great transit hub in Broadway Junction;
- Comparatively low property costs;
- Access to a strong local community that could serve as both workforce and customer base; and
- Proximity to one of the largest remaining clusters of industrial businesses in New York City.
With commercial vacancy rates well below the national average, and new businesses starting or moving to the five boroughs every day, there is a clear and growing demand for flexible, modern office space throughout New York City. A 2015 analysis by NYCEDC found market demand for new commercial space could reach as high as 60 million square feet by 2025.
The analysis estimated that roughly 25-30 million square feet of the needed space could be generated in Manhattan, in part through projects such as Hudson Yards and the World Trade Center, and through proposed rezonings such as Midtown East. Another 25-30 million square feet could be generated by activating the untapped potential of communities like Downtown Brooklyn, Long Island City, Downtown Jamaica, Lower Concourse in the Bronx, and Staten Island’s North Shore.
Today’s announcement came as part of a speech at the Crain’s Business Breakfast Forum, in which President Patchett outlined new and ongoing efforts by NYCEDC to create the space needed for continued economic growth and the creation of good jobs for New Yorkers.
Since Mayor de Blasio took office, New York City added more than 300,000 new jobs. Unemployment recently hit 4%, which is the lowest in recorded history and well below the national average.
As part of his 2017 State of the City address, Mayor de Blasio made a commitment to build on this success by creating 100,000 good jobs through direct City investments over the next decade. That includes recently announced efforts to efforts to add 2,000 advanced manufacturing jobs over next five years through Futureworks NYC and 1,500 jobs at a Made in New York Campus for film, television, and garment manufacturing in Sunset Park; and 600 tech jobs at a new innovation hub to be built at Union Square.
New York City Economic Development Corporation is the City's primary vehicle for promoting economic growth in each of the five boroughs. NYCEDC's mission is to stimulate growth through expansion and redevelopment programs that encourage investment, generate prosperity and strengthen the City's competitive position. NYCEDC serves as an advocate to the business community by building relationships with companies that allow them to take advantage of New York City's many opportunities. Find us on Facebook or follow us on Twitter, or visit our blog to learn more about NYCEDC projects and initiatives.