By exploiting legal loopholes to target the super-rich, developers are ravaging New York and its people
432 park avenue arturo pardavila
Source: Arturo Pardavila
A preposterous Mussolini balcony pokes out of the top of the most expensive home in America, offering high-altitude views across Central Park. The air may be thin up here, but the architecture is cloyingly thick with allusions to Manhattan’s golden age of skyscrapers: limestone slabs rise in clumsy setbacks to a faux Art Deco crown. ‘Architecture is a banquet and most architects are starving to death’, says the building’s architect, Robert Stern, who has stuffed his face at the table of historical allusion and vomited the half-digested results across the skyline.
‘From Hudson Yards to Billionaires’ Row, these towers are the totemic markers of a period in which real estate is the ultimate asset’
Topped with a $238-million apartment, 220 Central Park South represents the grotesque pinnacle of New York’s current wave of supertall, super-skinny, super-expensive towers, a brazen eruption of etiolated beanpoles that has sprouted along Billionaires’ Row and the southern fringes of Central Park over the last few years. These silos for the super-rich might not come as a surprise: form has always followed finance in Manhattan. But these towers signify a new species of steroidal safety deposit box architecture, the iniquitous extrusion of excess capital into a physical bar chart of inflated land values and free-market planning regulations.
The impact became evident when a wall of shade formed by the monolithic ranks of towers began to eclipse the southern side of Central Park. Stern was unfazed: ‘People don’t come to Manhattan to get a suntan’, he says. ‘Besides, we need room for aspiration. A lot of people can’t afford these apartments, but they aspire to them.’
Aspiring to a multi-million-dollar shoebox in the clouds might keep Stern and his team motivated, but it doesn’t do much for the average New Yorker. Development boosters claim these gilded sky mansions ‘give back’ to the city via the trickle-down benefits of luring ever more ultra-high-net-worth individuals to reside here and pay taxes. In reality, they are bloated monuments to tax evasion. Thanks to arcane condo taxation policies, billionaire hedge fund manager Ken Griffin’s $238-million fourstorey pad at the top of Stern’s tower is taxed as if it were worth only $9.4 million, while those in poorer areas are shafted at much higher rates.
Rubbing salt in the wound, the city’s so-called ‘inclusionary’ housing policy does little to redress the balance. A dreaded Faustian pact, like the UK’s Section 106, it is a doomed bargaining tool that naively banks on developers having an altruistic bone in their bodies and being willing to cough up a small percentage of affordable housing. As with Section 106, the rules are wide open to negotiation and the side with the most expensive lawyers (guess who!) wins. Developers can gleefully slash the amount of affordable housing on the grounds of ‘financial viability’ or pay in lieu to build low-income housing in less desirable areas. As a reward for their begrudging co-operation, they are free to pile more floors atop their teetering towers.
The bureaucratic bounties go on. Another rule allows the buildings to be extended even higher on grounds of needing additional ‘mechanical’ space. For some inexplicable reason, floors dedicated to structural and mechanical purposes do not count against the total allowable size. As a result, architects enlarge these voids to push penthouses nearer to the clouds, raising their value in the process. About a quarter of the floors in Rafael Viñoly’s 432 Park Avenue are empty – 90 vertical metres of overpriced air.
‘These silos for the super-rich might not come as a surprise: form has always followed finance in Manhattan’
But the most iniquitous part of this litigious horse-trading, envelope-inflating and loopholeexploiting system is that it happens behind closed doors, with no public scrutiny. The US tradition of individual freedoms and indisputable rights means the whole planning process operates on an as-of-right basis. Codes are written, developers find ways to exploit them, and the public is powerless as the unintended effects are wrought in increasingly swollen shafts of glass and steel above their streets.
New York City is by no means alone. But, as the cradle of the skyscraper and a safe haven for surplus cash, it is here that the symptoms of financialisation are most painfully visible. The latest pernicious product of the system is the $25 billion redevelopment of Hudson Yards, proudly promoted as the largest and most expensive private real-estate project in US history. Conceived as a citadel of luxury apartments, offices and shops – where you can spend five figures on a watch and $800 on a haircut – it feels like a malignant glass tumour, sucking the life out of Manhattan’s west side. Backed by Oxford Properties Group, a Canadian investment company owned by the Ontario municipal workers’ pension fund, it is a moneymaking machine without the slightest desire to make a piece of the city for New Yorkers. And the project somehow benefited from almost $6 billion in state funding and tax breaks.
From Hudson Yards to Billionaires’ Row, these towers are the totemic markers of a period in which real estate is the ultimate asset class, more valuable than all the world’s stocks, shares and securitised debt combined. In a damning indictment of society’s priorities, these rampant vehicles for ceaseless wealth accumulation are burgeoning while homelessness is at its highest level since the Great Depression. They are the glass and steel shrines to an age when the capital of capitalism finally consumed itself.
This piece is featured in the AR September issue on money – click here to purchase your copy today