By Arturo I. Sánchez
The aftermath of the 2008 financial meltdown ushered in a new troubling phase in New York City’s real estate market – the rise of mega projects. This new real estate cycle, fueled by large-scale domestic and foreign-based speculative corporate investments, is undermining neighborhoods and the city’s long-term future.
Queens County, the city’s most ethnically diverse borough, has emerged as an important arena for this new type of real estate investments. It is also a “soft investment site” with a bundle of undervalued physical assets. With two major airports, an expansive transportation network, relatively cheap land values and a local private/public/political growth regime that supports corporate driven growth – financial and real estate interests have identified Queens as a lucrative site for large-scale speculative investments.
Large scale real estate investment flows are not random processes. They are patterned and build upon previous investments cycles. The current inflow of corporate capital into Queens is framed by an earlier wave of incremental corporate investments in Flushing and Long Island City (LIC).
These two neighborhoods, which are dynamic economic growth poles, are connected by the 7-subway line and link the immigrant communities of Sunnyside, Woodside, Jackson Heights, Elmhurst and Corona. The Flushing and LIC growth poles function as strategic entry points for the influx of corporate investment patterns in northwestern Queens.
As a global city, New York is an important site for off-shore capital investments in the real estate market. In this regard, the Flushing growth pole is playing a geographically strategic role by linking New York’s trans-global functions to the growing pivot towards the Asian Pacific economy.
The explosive growth of Flushing’s financial sector and commercial and high-end residential projects have lubricated the in-flow of transnational Asian capital looking for secure overseas investment vehicles. The neighborhood’s growth – as a site for transnational corporate investments – is highlighted by the high-end and exclusionary Willets Point mega real estate project. These growth patterns are reinforced by U.S. capital investments in the Flushing Meadows Corona Park tourist complex and by the proposed public/private four billion-dollar modernization of LaGuardia Airport. The combined long-term impacts of overseas and domestic investments will restructure northwestern Queens and devastate local immigrant and working-class communities.
LIC’s growth pole investment patterns are linked to the overflow from Manhattan’s global corporate economy. The rezoning of LIC, the expulsion of light manufacturing and access to cheap and abundant capital sources opened the financial spigot for construction of high-end mega-residential complexes. In turn, this new housing was marketed to the growing ranks of symbolic analysts employed in mid-town and lower Manhattan.
LIC’s current and future growth is further reinforced by the extension of the 7-subway line to Manhattan’s Hudson Yards development project and by the two billion dollar Cornell Tech Campus on Roosevelt Island; slated for completion in 2043. Preliminary market studies project that growing numbers of high-end workers, linked to these mega projects, will eventually secure housing in northwestern Queens, along the 7-subway line.
In urban planning terms the economic processes at play are called geographical convergence. In effect, the Flushing and LIC growth poles will eventually converge/meld along the communities that abut the 7-subway line. Convergence will trigger higher real estate values and the wholesale expulsion of economically vulnerable residents that will be eventually replaced by domestic and foreign professionals linked to the Manhattan’s global economic sectors. Thus closing the symbiotic circle that systemically links Manhattan with the current restructuring of Queens County.
Currently corporate real estate incursions into Queens are operating at hyper-speed. This does not bode well for Queens or for New York’s long-term future as a sustainable and diverse city of immigrants.
Arturo Ignacio Sánchez, Ph.D. is an urban planner and chairperson of the Newest New Yorkers Committee, Community Board 3, Queens. He has taught at Barnard College, City University of New York, Columbia University, Cornell University, New York University, Pratt Institute and various Latin American universities.