Sunday, July 14, 2013

Daily News, ignoring conflict of interest, staunchly defends Forest City's modular construction plan in wake of lawsuit

The New York Daily News editorial page, always willing to go to bat for the Atlantic Yards arena, has moved on to support developer Forest City Ratner's modular construction effort to the hilt, taking up the defense against a suit filed last week by trade groups representing plumbers and fire suppression contractors. 

Today's editorial, Building blocks: City must clear the way for affordable prefab housing construction, somehow omits the newspaper's conflict of interest: it's sponsor of the arena plaza.

The editorial begins:
A groundbreaking, money-saving system for building housing has sparked hope that New York can boost production of badly needed affordable apartments.
Bruce Ratner, developer of Brooklyn’s Barclays Center and nearby Atlantic Yards, has introduced to the city the first structurally sound method for erecting pre-fab high rise housing.
In partnership with multinational builder Skanska, his Forest City Ratner company is erecting a 32-story residential tower whose rooms and hallways are assembled in a factory at the Brooklyn Navy Yard, then trucked to the site near the intersection of Flatbush and Atlantic Aves.
Mass producing bathrooms, bedrooms and kitchens and then stacking and bolting them together holds the promise of cutting the building’s cost by 20%. Which is a big reason why half its units will go for below-market rents.
All 181 of those will be affordable to families with annual incomes of less than $132,000, with apartments set aside for people with lower incomes, all the way down to $24,900.
The mass production cuts costs because union workers are paid less in the factory than on site, and are cross-trained to perform work previously done (or supervised) by specialists.

And while such lowered costs may make the subsidized housing more plausible, note that such lowered costs did not stop Forest City from reneging on plans to devote 50% of floor space to 2BR and 3BR units. Also note that Forest City has no plans to pass on such savings to the market-rate tenants.

So the "groundbreaking, money-saving system for building housing" has also sparked hope that Forest City can increase its profit.

What about the plumbers

The editorial continues:
When a building is erected the standard way, they and their employees are, by law, the only ones allowed to fit pipes together. So, every time a fire sprinkler or water pipe is assembled, all throughout a building, it’s money in their pockets.
Ratner’s factory construction uses union labor to put together one kitchen after another, one bath after another, in a process approved by the Buildings Department. The licensed plumbers fit only the final pieces together.
The plumbers’ trade group has sued to block the pre-fab work without their participation. The courts should toss this wrongheaded claim. If not, the City Council and mayor must enact legislation specifically authorizing the pre-fab process.
Note that the plumbers were not the only petitioner.

More importantly, the editorial skates over the issues raised in the suit: not only are the petitioners' claims backed by two former Department of Buildings Commissioners, but the DOB itself, according to the suit, was prepared to disallow such offsite work without the presence of specialists, but then refrained from issuing a document circulated as a draft.

There are some legitimate factual disputes here. And if the City Council and mayor consider such legislation, they should hold hearings to air those disputes, rather than simply do a developer's bidding.

What's at stake

The editorial closes:
Far more is at stake than Ratner’s project.
Affordable housing is a rare commodity in New York because astronomical building costs drive new construction sky high. To bring rents within reach of the working and middle class, the city spends billions of dollars to subsidize projects.
Lower costs would translate into lower rents and enable the city to subsidize more apartments. Ratner’s experiment will help determine whether this new method of building can be expanded at great savings across the city.
Everyone — led by mayoral candidates, who claim that making New York City more livable for the middle class is their top priority — ought to be cheering. In fact, they should be jockeying for a place at the front of the crowd when the ribbon is cut at the new Atlantic Yards tower.
As with so many things related to Atlantic Yards, there's another way to look at it. Yes, it's worth exploring whether current building rules are too costly, but it's also worth exploring why credible people believe it's hazardous to allow the modular process.

The Daily News frames this as a boon for affordable housing. Maybe. But it's also clearly a boon for the developer, and until we see how that balances out--does the developer, as with the Atlantic Yards arena, gain more than the public?--there's reason for skepticism.


  1. Anonymous3:05 PM

    The Modular Structure may be a fire hazard. The Plumbers Union should engage a fire engineer. The tubular construction and the space between the modules are chimneys and may accelerate a small fire.

    1. The issue of whether it is a fire hazard has been raised before, though not publicly addressed.

      I would very surprised if the developer hasn't done studies--for the purposes of insurance, etc.--that indicate that the fire hazard issue has been addressed.