Critical Real Estate Alert: Mayor’s Plan Would Require Special Permits for All Hotels in All Manufacturing Zones Citywide

It was reported today that Mayor de Blasio is proposing a significant expansion to an earlier announced plan to protect the City’s industrial businesses. This new proposal would require all hotels in all manufacturing zones City-wide to obtain discretionary special permits. In November of last year, the Mayor, with the support of key members of the City Council called for new zoning restrictions which focused on protecting the City’s 21 Industrial Business Zones (IBZs), including a ban on rezoning IBZ land for residential use and the elimination of as-of-right development of hotels in these areas.

The Mayor’s new plan now calls for requiring all hotels in all manufacturing zoning districts throughout the City, where such hotels are now permitted as-of-right, to obtain a special permit under the City’s Uniform Land Use Review Procedure (“ULURP”). ULURP, which requires approval from both the City Planning Commission and the City Council, is a lengthy, complex and uncertain process, which can easily add up to two years to the development process.

Creation of this hotel special permit will require an amendment to the New York City Zoning Resolution. It was reported that the anticipated timeline for creating the special permit is one year; though it is possible it could be accomplished in less time. The creation of this City-wide special permit is heavily supported by the New York City Hotel and Motel Trades Council, and it is reported that key City Council Members have signed to the expanded plan.

Hotel projects already underway and those planned on affected sites are able to vest the right to be built without a special permit if they secure a building permit based on a complete set of building plans and fully construct their foundations prior to the enactment of the amendment.

We are actively following this proposal and will keep you updated. Should you have any questions generally, or about a specific project site, please contact:

Mitchell A. Korbey at +1 212 592 1483 or mkorbey@herrick.com

Crain’s 2016 New York City Summit: Getting Ready for 9 Million New Yorkers

On the morning of November 1st, at the Sheraton Times Square, Mayor Bill de Blasio spoke to a diverse business crowd about the ever growing population of our City – trumpeting the fact that at 8.55 million, NYC has never been bigger. The Mayor discussed “diversifying the economy,” including using City resources to incentivize a “five-borough economy” with involvement of the City in encouraging “advanced manufacturing,” real estate development and upcoming rezoning initiatives. The Mayor also spoke about the need to build trust in neighborhoods and stressed efforts being made to inform communities that development isn’t happening to them, “but by them and for them.” He added that many of those who live in these developing neighborhoods look at development “through the prism of past (and not good) experiences” but by building trust through “guaranteeing that developers do what they promised,” their attitudes would be able to change as well.