After decades of planning and false starts, the Yonkers renaissance appears ready to finally take off. Gleaming new luxury condos, ambitous mixed-use projects and even a planned rejuvenation at the stalwart Cross County Shopping Center are all in the works as the fourth largest city in New York looks to reclaim its past glory.
It's a more than welcome development for city officials who have tried for decades to kick-start an area that 50 years ago was the shopping capital of Westchester County as the home to famed department stores including Genung's, Gimbels and Wanamaker's and the one-million-square-foot Cross County center, which was built in that era on Cross County Parkway. From the start, the property pulled from a trade area of 2.8 million million people.
“It sits on the crossroads of three major highways and was incredibly successful,” says Joseph French, national director of retail real estate with real estate investment firm Sperry Van Ness. French grew up in the area and recalls making the hour-long trek many a time in the 1960s as he and his parents drove from their home in Connecticut to shop at the property.
But Yonkers fell into hard times in the ensuing decades. Once home to a strong light manufacturing sector, Yonkers lost its industrial jobs. On top of that, the city faced political scandals and the real estate crisis in the late 1980s and early 1990s hit particularly hard here and took awhile to overcome.
Even Cross County — while still a vastly popular retail destination — got more competition. Although it remains dominant in Westchester with few malls in the area, Connecticut families no longer have to pile into station wagons to find an equivalent retail experience.
But things are changing thanks to officials' efforts to make Yonkers more appealing to developers. For example, since 2002, the city has completed several public projects including a $45 million renovation of its train station and the creation of a 200,000-square-foot library. As a result, residential projects, including Collins Enterprises' Hudson Park, which combines 266 rental units with 21,000 square feet of commercial space, are sprouting along the waterfront.
More recently, in May the city launched a water taxi service that runs from downtown Yonkers to Battery Park City Ferry Terminal in Manhattan, offering an alternative to the Metro-North commuter train line. A one-way trip to Pier 11 near Wall Street takes 57 minutes and costs $12.
That's allowed officials to boost Yonkers as a viable alternative for residents being priced out of New York City. Effective average rents in Yonkers are $1788 per month, according to Business in the Burbs, a blog run by the local Journal News newspaper. Meanwhile, Manhattan average effective rents are twice that — $3,528 per month — according to Encino, Calif.-based Marcus & Millichap Real Estate Investment Services.
Moreover, despite past difficulties, Yonkers boasts too many strengths for it to struggle forever. Unlike other similarly-sized metro areas, Yonkers still boasts some tracts of virgin land, French says. Additionally, a number of its vacant industrial properties are ripe for a round of redevelopment.
And Yonkers government officials, including Mayor Philip A. Amicone, welcome real estate developers with open arms, eager to bring new jobs and sources of revenue into the city. As a result of all these factors, Yonkers has the attention of national developers including Related Cos. and Forest City Enterprises Inc., who are both building projects in the city.
Even Cross County is getting a makeover as its current owner, Brooks Shopping Centers LLC, is working with the property's manager, Santa Monica, Calif.-based Macerich Co., to complete a $100 million 245,000-square-foot expanasion and re-merchandising of the property that began in 2005.
“People use the term renaissance, which I think is appropriate,” says John Genovese, Macerich senior vice president of development. “Retailers who had not considered Yonkers in the past are now looking at it as a great opportunity.”
Things are so busy that $5 billion in new developments will rise in Yonkers during the next five years, including 17 high-rise residential buildings and several mixed-use centers. Retail rents in the area currently hover around $40 per square foot, according to Yonkers-based NAI Friedland Realty, Inc., while the vacancy rate remains in the low single digits, at 3 percent.
Sinkhole
Efforts to spearhead major redevelopment initiatives in Yonkers have been stymied since at least 1983 after Otis Elevator Company left the city, moving one of its largest employers. Initially, efforts to try and turn things around were obstructed by political squabbles and disputes over who controlled redevelopment rights to the city's waterfront. That took years to sort out.
But that was only one problem. In 1980, after Yonkers officials refused to build subsidized housing outside of traditionally poor neighborhoods, the federal government and the National Association for the Advancement of Colored People filed a lawsuit against the city arguing the practice amounted to “purposeful segregation.”
The court battle lasted 27 years and settled this past May, as Yonkers refused to change its policy even after a 1985 ruling in favor of the plaintiffs. By the late 1980s, the city was on the brink of bankruptcy as a result of legal fines and contempt of court charges that doubled every day.
While battles over the waterfront and affordable housing raged on — and redevelopment stalled as a result — other businesses followed Otis's lead and left Yonkers in droves, transforming the once bustling downtown into a seedy area, says French. By 1994, office vacancy rate in the area had reached a whopping 19 percent.
Things took a turn for the better as officials realized a sense of urgency and sorted out problems. But even after they got their house in order and began talking to developers, they got burned again.
In 2003, for example, local real estate entrepreneur, Joseph Spiezio III, backed out of an agreement to build a minor league ballpark after a spat with then-Mayor John Spencer. Only now have things finally moved decisively in a positive direction.
Capping it off
This summer, in a landmark deal for the city, Struever Fidelco Capelli LLC, a joint venture between Baltimore-based Struever Bros., Millburn, N.J.-based Fidelco Realty Group, and Valhalla, N.Y.-based Capelli Enterprises Inc., submitted a 3,000-page draft environmental impact statement to the city for its proposed $3.1 billion revitalization project. It will encompass the entire Yonkers business district, plus two miles of waterfront.
The development's centerpiece will be the River Park Center, a mixed-use property combining a 6,500-seat ballpark with 580,000 square feet of retail, 175,000 square feet of office space, 800 residential units and a 100,000-square-foot hotel. There are also plans to create a riverfront esplanade and a waterfront residential development. If the project gets the green light, it will become the largest redevelopment initiative in the New York metro region.
Struever Fidelco Capelli anticipates breaking ground in spring 2008.
Meanwhile, earlier this year Brooklyn, N.Y.-based developer Forest City Ratner Cos. received approval for its Ridge Hill Village, an 81-acre mixed-use project located between the New York State Thruway and Sprain Brook Parkway, anticipated to break ground next year.
The company secured the largest construction loan it its history, $630 million, in August, for the development. Upon completion, expected in 2009, Ridge Hill will encompass 1.3 million square feet of retail and entertainment space, 1,000 residences, 160,000 square feet of offices and a hotel.
According to Forest City, the project will bring Yonkers more than $375 million in sales, occupancy and income tax revenues over two decades.
Additionally, Yonkers-based Homes for American Holdings, LLC will undertake its own $900 million mixed-use project on the Alexander Street Corridor; a 16-acre property that had housed a manufacturing facility for insulated cables.
Called Point Street Landing, the development will feature 1,124 residential units, 40,100 square feet of retail and restaurants, 52,000 square feet of office space and six acres of parkland. Homes for American Holdings expects to break ground in 2008.
And Cross County's overhaul also continues, a project that Genovese expects to be completed in 2010.
Several national “aspirational” retailers have expressed interest in leasing space at the renovated Cross County Shopping Center for their first location in Yonkers. Genovese declined to name the retailers, but says they include a handbag and accessories chain, among others.
With all the activity, Yonkers has risen to prominence on the radar of trendy restauranteurs. In June, a hip new restaurant, X20 Xaviars opened on a city pier. Downtown, novel pubs and eateries, such as the Whiskey Rio and Zuppa Restaurant and Lounge, have opened in the Getty Square area, echoing a vibe similar to that of the Williamsburg neighborhood in Brooklyn.
“There is no Olive Garden or anything like that, but there is no need for that; this is a trendy place,” says French.
DEMOGRAPHICS
Population: 197,388
Housing units: 77,589
Homeownership rate: 43.2%
Households: 74,351
Median household income: $44,663
Per capita income: $22,793
Retail sales, 1997 ($1000): 1,533,440
Retail sales per capita: $8,042
Land area (square miles): 18
Persons per square mile: 10,847.5
Source: U.S. Census Bureau