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Towers & Tenements
Act II: The Siege
Battle Over Theater Zone Nears Final Scenes

by J. A. Lobbia
July 22 - 28, 1998



There's a new drama playing on Broadway, and the most recent scene left some of the actors themselves stunned. "The city council today gave away its power in Midtown Manhattan," said Kevin Finnegan. "It just blew my mind."
Finnegan, land-use chair of the community board that covers parts of Hell's Kitchen and Clinton, is among the cast in a municipal drama that pits the venerated world of Broadway theater against its scrappy residential West Side neighbors.

The plot centers on a zoning plan to enrich theater owners�and thus preserve theaters�by letting them sell air rights within a broad swath of Midtown and permitting buildings constructed with those air rights to be bulkier than current zoning allows. Clinton and Hell's Kitchen tenants say the plan, written by the Department of City Planning (DCP), will further squeeze renters who are already feeling the effects of a supercharged real estate market.

On July 15, the council's Land Use Committee approved the DCP plan with some modifications. Most significantly, it protected the west side of Eighth Avenue north of 45th Street by forbidding its use as an area where buildings could be developed using air rights. Both the DCP and full city council are expected to approve the revisions in early August.

Scrapping most of Eighth Avenue's west side was touted as a prize for tenants who feared mega development. But sources say theater interests never seriously banked on its inclusion. Rather, DCP kept it on the table partly to provide an easy give-back.

"This is not a victory at all because it still pierces the community at its softest part," says Bob Kalin, a Hell's Kitchen tenant organizer. "They simply wrapped up a development deal in this theater thing, and when Tony Randall is sitting there" speaking to the council, as the actor did last week, "no one is thinking of anything but how they feel for him."

Sources in and out of the council suggest that powers beyond the Broadway bigs trotted out to testify�playwright Wendy Wasserstein, librettist Betty Comden, and composer Stephen Sondheim�played a crucial part. Says Kalin: "The council members had their marching orders from [Council Speaker and gubernatorial candidate Peter] Vallone, who did not want to cross the real estate community and theater owners." Theater owner James Nederlander and theater lobbyist Ethan Geto were listed as benefactors at a June 18 Vallone fundraiser.

A Vallone spokeswoman dismisses the charge. "We had meetings until early this week and did not know which way we were going until the vote," says Carolyn Daly. Geto, who described his clients as "thrilled" with the vote, said that while Vallone had "philosophically bought into this plan at an early juncture," any suggestion of political dealmaking is "ridiculous."

Since Mayor Rudy Giuliani unveiled DCP's plan in December, a theater industry coalition including owners, actors, and some unions has argued that financial hardship threatens the Great White Way. Even though Broadway audiences are ever-growing�11.3 million in the '97­'98 season, up from 8.2 million in 1993, with blowout musicals like Titanic and warhorses like Cats as the main draws�the industry is pleading poverty. Citing decades-old statistics, owners lament that many theaters have been dark for most of the past 30 years. And they warn that the straight play is in jeopardy�at least as a commercial commodity.

DCP's solution is to let theater owners sell the gold mine of air rights that hover over their landmarked properties, and dedicate part of the profits to a theater fund. Owners could sell air rights within a district bounded by 40th and 57th streets between Sixth and Eighth avenues. Within that zone are 25 theaters with air rights valued at $100 million. Twenty theaters are owned by three theater moguls�the Nederlander family, Gerald Schoenfeld of the Shubert Organization, and Rocco Landesman of Jujamcyn Theaters.

"The idea that this will help members of the Shubert Organization run off to the south of France with these earnings is absurd," Gerald Schoenfeld, chair of the Shubert Organization which owns 12 theaters, told a council committee.

Robert Nederlander, part-owner of the Yankees and president of the Nederlander Organization, which owns and operates nine Broadway theaters, balked at a requirement that buildings be used as theaters for the rest of their lives. "But the fact is we are in the theater business, have been for years, and will continue to be."

Which raises doubt about whether the city needs to offer such generous help as a major rezoning plan. The Nederlander Organization, which was cited for illegally excessive contributions to Giuliani's campaign last fall, owns a block of vacant apartment buildings on Eighth Avenue at 47th Street which could be demolished and become a receiving site for air rights.

"They'll make money both ways," says Kalin. "We're not preserving the art of the theater, but the commerce of the theater. If they had a chance to produce 19 different versions of Cats, they'd be happy."

While the council committee required stricter reviews for proposed buildings than DCP suggested, it cheated itself out of a say in the developments by leaving approval primarily with DCP. "The council just wrote themselves out of it without raising a fuss," said Finnegan. "They actually passed legislation that took power away from themselves and said, 'We don't like it, but this is as good as it gets.' How can that be?"

Only two members voted against the plan: Sheldon Leffler of Queens, who railed that the scheme "let these owners make all this money" without a compelling public interest, and Tom Duane of Manhattan, who represents most of Clinton and Hell's Kitchen.

"I have many concerns," said Duane. "I'm worried about displacement and illegal construction and evictions from SROs that are happening and will happen more because of development on Eighth Avenue. This is from the same administration that cut the budget for cultural affairs. Why cut money for theaters and then do this?"

Indeed, Clinton and Hell's Kitchen have been battling gentrification despite special protection from a zoning measure called the Clinton Special District, designed to protect affordable housing, including the neighborhood's 8000 SRO units. But lax city enforcement has meant that scores of apartments have been lost to illegal demolition and construction.

Katherine Gray, the housing chair for Community Board 4, is convinced the plan to save theaters will only endanger her neighborhood.

"In the last six months, we've had the most egregious violations," Gray told the council. "We're seeing landlords add floors with no permit, and subdivide apartments so that some have no fire escape. We tell the city we need enforcement help in the Clinton Special District and they respond by offering additonal development. How is that intepreted?"