NEW YORK —?Three nonprofit groups, including the Garment Industry Development Corp., has submitted a grant proposal to the Lower Manhattan Development Corp. seeking funding for a program designed to keep apparel manufacturing downtown.
The proposal calls for a $25 million grant to create New York Fashion Space, which would be a nonprofit real estate development corporation that would run buildings dedicated to apparel manufacturing tenants. According to Linda Dworak, president of the GIDC, the goal would be for the company to run one or more buildings with a total space of 300,000 square feet that would provide room for about 2,500 apparel jobs.
The other groups backing the proposal are Unite and the New York Industrial Retention Network. Dworak said Asian-Americans for Equality has also backed the proposal, though it is not a formal petitioner.
The LMDC was created by Gov. George E. Pataki and former Mayor Rudolph Giuliani in the wake of the Sept. 11, 2001 destruction of the World Trade Center to manage the rebuilding of Lower Manhattan. The LMDC is funding development projects out of a $2 billion block grant from the U.S. Department of Housing & Urban Development.
Dworak said creating Fashion Space would help alleviate the real estate pressures that have been pushing apparel manufacturers out of Manhattan. In the aftermath of the attacks, downtown contractors reported that pressure to raise rents on industrial space eased, as landlords recognized the difficulty they would face in attracting new tenants to a neighborhood that was in disarray. However, recognizing that in the long term downtown real estate would remain highly valuable, landlords began offering industrial tenants shorter leases — often of just two years compared with the more common 10-year commercial leases.
Uptown in the Garment District, landlords are backing a proposal to lift the special zoning restrictions that set aside half the space in side-street buildings for manufacturing purposes. That possibility creates further uncertainty for Manhattan makers.
“A lot of [garment manufacturers] have complained that they have a problem with the stability of their leases and as a result have problems with long-term planning,” Dworak said.
Adam Friedman, executive director of the Retention Network, explained that short-term leases present logistical problems to manufacturers.“You can’t have reinvestment if you don’t have lease security,” he said. “You can’t have manufacturers and designers building relations with contractors if they don’t know where the contractor is going to be in six months or a year.”
Dworak said the goal would be for Fashion Space to charge apparel manufacturers lower rents than they could find in other area buildings, something the organization could do if it owned the buildings it managed. The move is an effort to address concerns that the continuing decline in the number of manufacturers could cause activity to drop below the critical mass needed for the industry to sustain itself.
“I’ve been hearing a lot these days that there’s a lot of concern that the cluster is disappearing, that we’re losing key parts of the industry,” said Dworak. “We’re really working on this project to try to prevent that from happening.”
Employment in the city’s garment industry dropped precipitously in the two years since the terrorist attacks. In July, the most recent month for which data is available, apparel manufacturing in the five boroughs employed 32,600 people, according to the state Department of Labor. That’s off 33.1 percent from 48,700 in July 2001.
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