A Demand That NY City’s Zoning Laws Should Subsidise The Fashion Industry – Forbes

A piece in the New York Times demanding that the zoning laws of New York City continue to subsidise the fashion industry. By, and this might not be a coincidence, two people who work in the fashion industry. If it is coincidence of course it’s a remarkable one for of course the demand is, when stripped to its economic essence, that other peoples’ money should continue to flow into the pockets of those who work in the fashion industry.

I’ve got mine and I want to keep it is both common and very human even if not wholly admirable.

The piece is by:

Nanette Lepore is a fashion designer, and Robert Savage is her husband and the chief executive of her label.

Knowing entirely nothing about frocks and the like–I shop for clothing in thrift stores–I have no idea who they are. However, knowing something about economics I can decode what they’re saying. And much of it is very much straight up good economics:

We are a global fashion capital because this vibrant, innovative neighborhood has existed for nearly a hundred years. Within these blocks — between 35th and 40th Streets and Sixth and Ninth Avenues — all the components of the fashion process are within walking distance. This synergy brings hundreds of aspiring designers to New York each year to learn their craft and start their lines, and it sustains some 200,000 jobs and generates billions of dollars of revenue every year. Broadway and Off Broadway theaters as well as Lincoln Center costume houses all use the garment district daily. The fashion schools, including F.I.T., Parsons, Pratt, LIM, Kent State and others that have branches here, use the district as a springboard for young talent. The development corporation’s plan puts all of this at risk.

Absolutely and entirely so. Agglomeration, regional specialisation and all that. The industry works because all that is needed for it to do so is in roughly the same place. And you start a new entrant into the industry there because everything you need is already there. That’s why you do tech in Silicon Valley, all the lawyers who understand VC agreements there, all the accountants who can do accounts for software companies are (they’re a little odd sometimes with what’s capital expenses, what’s current), the sources of finance and so on. Even today, although the steel industry left 49 years back in any size, you want to work with odd metals in the UK you do so around Sheffield, you’re setting up a new pottery you do so in Stoke on Trent (I know, directly, of one of each in each place just recently).

No, we’re with you there, such clustering is absolutely the lifeblood of specialist industries. There’s even a couple of villages in Italy responsible for some unnerving percentage of the world’s spectacle frames, one in China apparently churning out 80% of the world’s socks–even I find that last one hard to believe but I’m told it is so.

So, what is wrong with this story?

Manufacturing in New York City’s garment district is in jeopardy of unraveling at its seams. The city’s Economic Development Corporation may soon begin the certification process to lift the zoning laws that have protected fashion and apparel businesses in these few blocks in Midtown Manhattan for decades.

The intention is for manufacturers to relocate to Sunset Park, Brooklyn. With lower rents and longer leases, the development corporation hopes to lure factory owners to a 200,000-square-foot industrial space, now being renovated. The garment district’s Business Improvement District has voted to provide financial assistance to cover some expenses for relocating factories; in exchange, the zoning laws will be lifted. If the local community boards approve the plan, it will be brought before the City Council for a vote, and the changes could occur in as little as a couple of months.

The important part there is the bit about zoning. NTY’s zoning system is, umm, complex. That covering this district is described as:

The Special Garment Center District (GC) was created to maintain opportunities for apparel production, and wholesale and showroom uses in existing buildings in designated Preservation Areas on selected midblocks between West 35th and West 40th Streets west of Broadway. In Preservation Area 1 (P-1), east of Eighth Avenue, hotels are not permitted and the conversion of industrial space to office use is permitted only by certification by the chairperson of the City Planning Commission that an equal amount of comparable floor area has been preserved for specified industrial uses. In Preservation Area 2 (P-2), between Eighth and Ninth Avenues, conversion of larger buildings to residential, office or hotel use is permitted only by authorization of the City Planning Commission.

Not wholly and not exactly but pretty much what’s in use as part of the garment industry has to stay in use as part of the garment industry. This is of course a considerable subsidy from the people who own the buildings to that garment industry. What is being complained about is that this special designation might be lifted, meaning that full commercial rents will start to apply in this area. For if current sewing rooms can be converted into condos, hotels, offices, then the higher value of exactly those uses will mean that higher rents can be paid upon them.

Note that this is exactly the worry being expressed. If zoning is lifted then the district will disappear–precisely because higher rents in the absence of the restrictions will force out the lower value activity. This is, therefore, precisely as I have described it, a demand for a continued subsidy from the landlords to that fashion industry in this location.

At which point we’ve got to decide what to do about this. The answer being lift the restrictions. For the claim is that the presence of said fashion industry in the heart of Manhattan, on the most expensive real estate in the world, is worth it. Well, if that is so, then that industry can afford to pay the rents to be in one of the most expensive parts of the world. And if that industry cannot afford to do so then it’s not that valuable, is it?

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