EDC boss shares city's good news - New York City Economic Development Corporation's Andrew Alper on improving city economy

Real Estate Weekly, Jan 21, 2004 by Elaine Misonzhnik

The state of New York's economy is getting better every day and whatever loose ends are still left, the City's Economic Development Corporation is working hard to get rid of them.

Such, at least,was the message of EDC president Andrew Alper when he spoke at the New York State Society of Certified Public Accountants conference last week. Alper said the City has come a long way in the past two years, when its new administration faced total devastation downtown and a $5 billion budget deficit.

"For the first time in the last two years, I have good news," he said. "The City is in great shape. Unemployment is at a 20-months low. Crime rate is at its lowest since 1968. Real estate values are 15% higher than a year ago, Wall Street hiring is up and new hotel rooms are being built throughout New York." According to Alper, some of EDC's recent initiatives played a role in bringing about such positive changes.

"When I came to office, it was clear we had to have a very focused strategy," he said. "Our mission statement said that we had to encourage economic growth in all five boroughs, revitalize lower Manhattan, create new Central Business Districts and improve New York's infrastructure. I think these were very sound strategies."

But even though Alper is quite happy with how things turned out in Lower Manhattan--"No major businesses have left and most of the vacancies have been absorbed," he noted--and the City's progress in the outer boroughs, he is concerned about creating enough new office space to accommodate New York's future growth.

"According to some studies, between 2005 and 1025, the New York region will need about 250 million s/f of new office space," he noted. "Without it, we will lose our competitive edge. Over the next 15 years, we plan to build about 25 million s/f of space, but 10% of the needed number is really not enough."

As a way to deal with this problem, Alper would really like to see major redevelopment on the Far West Side of Manhattan, perhaps in addition to an improved business district in Queens' Long Island City.

"In the late 1990's, companies who wanted to relocate to New York, could not find contiguous class A space," he said. "If we start work on the Hudson Yards by extending the #7 subway line, we could create about 20 million s/f of new space, both commercial and residential."

Alper would also like to see more manufacturing, tourism and bio-medical jobs enter the New York market. According to him, the City is a perfect fit for all three because of its large immigrant and minority populations.

"We have to create high quality jobs for working class people," he said. "The good news is that we are stabilized. New York is a huge market, we have the seventh largest economy in the world and 40% of our citizens are foreign born. I am convinced that if we target the right industries, we can grow [these job sectors.]"

Among the initiatives Alper would like to employ to get such growth would be to sponsor the creation of industrial parks throughout the region to deal with manufacturing space issues, to expand the Jacob Javits Convention Center and the New York cruise terminal to bring in more tourists and to begin a major PR campaign for New York as a bio-medical heaven.

"We have over a dozen world-class medical institutions here, we train 50% of the nation's physicians, we have the most genetically diverse population in the world," he noted. "But when we talk to CEOs of pharmaceutical companies they tell us the possibility of locating in New York never even occurred to them. Obviously, we have to get the word out."

Overall, however, he was quite happy with New York financial health. "The City is very well positioned to capture growth as the economy turns," he said.

And, he promised that New York's real estate industry may get a pleasant surprise when such a change takes place.

"We raised the property tax because it was the only tax we had control over and we had to balance the budget," he explained. "As soon as we can reduce it, we will."