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Moving Forward in Soho and Noho

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Moving Forward in Soho and Noho

New York City takes some encouraging first steps toward rezoning these iconic neighborhoods. November 17, 2020
New York
Economy, finance, and budgets

Last year, I was one of many commentators arguing for the rezoning of Soho and Noho. These affluent and low-density enclaves in the core of Manhattan have long had antiquated zoning premised on the fiction that they were sanctuaries for working artists and light manufacturing. The Department of City Planning has now advanced a proposal for an Environmental Impact Statement to implement land-use and zoning changes. The document, though revealing the department’s current thinking, remains vague in some respects, and the details of the proposal that will eventually enter the city’s land-use review process are not entirely clear. However, as described, the proposal seems to reflect a welcome willingness to depart from some of the ideological rigidities that have made the de Blasio administration’s zoning policies ineffectual. At the same time, it demonstrates the complexities of rezoning in a transit-rich, mixed-use area in Manhattan’s core. In recognizing that many different activities are appropriate in Soho and Noho, the proposal would lead to growth, but it is unlikely to deliver the full complement of new mixed-income housing that it projects.

Any workable zoning proposal for Soho/Noho needs to accomplish several goals. First, it must extricate the city from the artists-only housing regulations enacted in the 1970s and the dubious practice of certifying artists to live in the area. The restrictions on who could live in Soho and Noho were impractical from the start and soon undercut by the absence of enforcement and successive amnesties for non-artists. Today, the city admits that few, if any, certified artists live in the area. Nonetheless, the administration had been resistant to acknowledge that anyone should be able to live in any residence in Soho and Noho, seeing that concession as a kind of “windfall” for property owners. The new proposal would allow this change, but with “conditions that more broadly benefit the arts and creative industries.” It’s not clear what those conditions would be, but if they are costly, property owners will simply keep their existing restrictions, knowing that these rules are effectively unenforceable.

A second goal of a Soho/Noho plan must be to recognize the retail character of most of the area’s ground-floor spaces, which the 1970s plans had sought to preserve for manufacturing. These restrictions had necessitated continual requests for waivers by the City Planning Commission or the Board of Standards and Appeals, imposing an undue burden on property owners. The city’s plan is forthright on this, making retail broadly as-of-right.

A third goal should be to regularize the presence in Noho of the large institutions that flank it—New York University and Cooper Union. These are already present in the area, often as well through various waivers granted by the city’s land-use regulatory agencies. The proposal is again forthright, allowing community facility uses, including schools, colleges and universities, and ambulatory health-care facilities, as-of-right. Since institutions have ongoing space needs and may be less affected by the current pandemic-induced recession than the office market, more flexible rules may lead to new investment that helps support the city’s economic recovery.

The fourth goal is newly recognized, as a result of pressure from pro-housing activists to promote mixed-income housing in affluent areas. In such areas, developers might be expected to find it profitable to construct new apartment buildings, with a significant affordable-housing component, without any public subsidy, other than tax exemptions provided in state law. Mayor de Blasio had been criticized for proposing rezonings only in lower-income areas, where his policy of mandating a sizable permanently affordable housing component in each new building was achievable only with deep construction subsidies—at great cost to the city.

The city’s proposal significantly increases the size of buildings permitted by zoning—and allows new residences as-of-right—provided that a percentage of the units, at least 25 percent as a practical matter, are low-rent and targeted to households that would not otherwise be able to afford living in the area. The administration’s recent “Where We Live” fair housing plan describes the Soho/Noho rezoning as intended “to expand the housing stock, add new affordable housing, and increase neighborhood diversity.” Whether a property owner builds mixed-income housing, however, depends not only on its profitability but also on that of the available alternatives. In Soho and Noho, the limited number of large, developable sites can be used for many activities— not only housing, but office space and institutional expansion. The mayor’s policy of forcing housing developers to give over a significant share of residential space to affordable housing simply makes those alternatives more economically attractive.

In reality, Soho/Noho’s contribution to the city’s fair housing goals is likely to be modest. The city could get closer to its objective by reducing the permitted size of non-residential buildings, but that would only discourage growth of important institutions, as well as expanded office employment. The Soho/Noho rezoning is best seen as the first of what should be many rezonings to allow more housing in high-opportunity areas. Increasing the housing stock and promoting affordable housing are citywide tasks, and many other, much larger, affluent neighborhoods—not just these—need to play a role as well.

Photo by Spencer Platt/Getty Images

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