Secret Deal Over Pier 40 Air Rights Struck in December

By Danielle Tcholakian on May 21, 2014 12:26pm 

 Pier 40 in Hudson River Park badly needs repairs.
Pier 40 in Hudson River Park badly needs repairs.
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DNAinfo/Danielle Tcholakian

WEST VILLAGE — A secret deal brokered by the state to sell air rights from Pier 40 for a massive development in the West Village was done back in December, DNAinfo New York has learned.

At a meeting with the Hudson River Park Trust and Empire State Deveopment Corporation on Friday, local elected officials discovered that a Memorandum of Understanding regarding the deal was signed months ago by the Trust, the ESDC and Atlas Capital Group, after the politcians learned about a "tentative" deal earlier that day from a report in The New York Times, attendees of the meeting said.

"Shocked is an understatement for how we all felt," said Borough President Gale Brewer, who was at the meeting. "To not know — it was really astonishing this was done."

The Trust and ESDC quietly signed a $100 million deal to allow Atlas to build new residential and retail space at the nearby St. John's Terminal building while providing much-needed cash for the crumbling Pier 40 across the street, according to officials and reports.

Legislation enacted last year by Assemblyman Richard Gottfried and Assemblywoman Deborah Glick regarding air rights transfers explicitly stipulates that the deal must adhere to local zoning.

Local politicians, including Glick and Rep. Jerrold Nadler, heard rumblings about a potential deal earlier this spring and sent a letter to Gov. Andrew Cuomo and Mayor Bill de Blasio on May 1, reminding them that an air-rights transfer could only be made possible by a promise to go through city planning processes, known as ULURP.

The governor never responded, so the elected officials were startled to read a report in The New York Times two weeks later saying the Cuomo administration had reached a preliminary deal to sell Pier 40's air rights to a mixed-use development at the St. John's Terminal building.

"The response, apparently, was the article in the Times," Glick said.

At a pre-planned meeting with local officials, the Hudson River Part Trust and Empire State Development Corporation held the same day the Times article was published, Marion Phillips, the ESDC's senior vice president of community relations, mentioned the MOU, though meeting attendees said he was unable to provide any details. 

"I think it was an inadvertent comment and he let the cat out of the bag," Nadler said.

Glick said Hudson River Park Trust President Madelyn Wils, who was also at the meeting, was hazy on specifics as well, but said the deal was for $100 million and did not include any affordable housing.

The elected officials said they were especially upset that they had met with Wils about Pier 40 several times since December, but she never mentioned that a deal had been signed.

The ESDC declined to provide a copy of the MOU to DNAinfo. Phillips had promised the elected officials copies of the MOU by Monday, but they had not received them as of Tuesday night.

"We are concerned about the current condition of the pier and committed to its redevelopment," an ESDC spokesman said in a statement. "The state will continue to work together with the city and local elected officials and community stakeholders toward a viable solution."

Cuomo's office did not respond to requests for comment.

"Pier 40 is in dire need of immediate infrastructure repairs," said Hudson River Park Trust spokeswoman Keri Lyon, "and we're looking to the state and the city to find the right approach to solving this problem."

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