N.Y.’S SEWERS REAP NO REWARDS
Byline: Eric Wilson / Rosemary Feitelberg
NEW YORK — As the focus on Seventh Avenue’s shifting landscape continues to move to nonapparel businesses, several factory owners and urban watchdogs are trying to pressure the city to protect what remains of its garment industry.
While three-quarters of New York’s apparel factory jobs have been lost in the past three decades, mostly to countries with cheaper labor costs, the remaining factories have been facing new pressure as the city’s economy has rebounded and the cost of doing business in the fashion center has increased along with commercial rents.
Even though there are zoning regulations in the garment district designed to protect factory jobs, there is mounting criticism from union officials and proponents of urban industrial diversity that the city has not enforced these laws.
The Center for an Urban Future, a not-for-profit group that studies city problems, issued a report last week that was highly critical of Mayor Rudolph W. Giuliani’s administration for not supporting the apparel industry — still the largest manufacturing employer in town — in the same way it has the financial and new media industries.
The report outlined how the special garment center preservation district, which was created by zoning law in 1987 and requires half the space in some buildings on side streets to be set aside for manufacturing, has not been enforced since 1993; funding was eliminated for when Giuliani became mayor.
The report criticized Giuliani’s administration for reducing its financial support to the Garment Industry Development Corp. by 6 percent since 1993 and compelling it to stop a federally funded program that retrained sewing machine operators, and for denying local Business Improvement Districts, including the Fashion Center Business Improvement District, their requests to increase their privately funded budgets. This has forced the FCBID, for example, to cut back on financial support for several fashion initiatives.
In response, Giuliani told WWD the city enforces all existing laws and regulations and that he had worked to increase the fashion industry’s profile by returning the twice-annual runway shows to Bryant Park and staging a giant runway show in Times Square last September as part of the city’s millennial celebration.
Giuliani said it was not more regulations that would help retain factory jobs in New York “but rather, it is creating the conditions under which businesses can grow, and no administration in 50 years has created as many new private sector jobs as I have.”
While the city’s economic revival is largely attributable to gains on Wall Street, a coinciding drop in major crime, reflecting a national trend, has helped draw new businesses to New York. Times Square and 34th Street, the areas directly north and south of the district, have undergone their own commercial renaissance, which have begun to trickle into Seventh Avenue environs in the form of higher rents and conversion of showroom and factory space into offices for new media and advertising agencies.
In its report, the Center for an Urban Future quoted William Daly, director of the Mayor’s Office of Midtown Enforcement, as saying the zoning regulations have not been enforced since 1993, when funding was cut off. Daly confirmed in a separate interview with WWD that funding for enforcement was eliminated.
The changing climate of the district has been the subject of analysis by city officials as nonapparel businesses take over huge chunks of real estate, as did Bates Advertising at 498 Seventh Avenue last year, and is the subject of an ongoing exhibit at the Municipal Art Society of New York.
One of the biggest concerns of labor proponents and manufacturers that use local factories because of the benefits of nearby production, such as fast turnaround and quality control, is that in some cases landlords are eager to convert factory space into commercial rentals for more lucrative industries, a trend going on throughout the city.
For example, Primo Coats, which employs about 50 workers making outerwear and pants, recently moved from 826 Broadway to the Long Island City section of Queens because its landlord was demanding a much higher rent, said Rocco Ciccarelli, its owner.
“The rent was about to go up, and I could not afford it,” he said. “The choice was to move or go out of business.”
Michael Cohen, who runs VC Sportswear, a clothing factory with 90 employees in the NoHo section of Manhattan, said his landlord had offered him a substantial incentive to leave before his lease expires in two years.
“The landlords are tripling rents and splitting floors up into smaller spaces,” said Cohen, noting that higher rents probably would drive his firm to a factory in Queens or New Jersey, where rents are lower.
In New Jersey, for example, there are spaces that rent for $5 to $6 per square foot, about half of Cohen’s current rent in NoHo, he noted. In Long Island City, the average is $7 to $8 per square foot. However, the advantage of retaining its current location is the proximity to designers and the garment center.
“It’s not going to be as easy for the workers to get to New Jersey or Queens,” Cohen said. “Half the factories here will close because they can’t afford to relocate.”
Other recent cases, as cited in the Urban Future report, are Milady Bridal, with 80 factory jobs, which in September moved to Union City, N.J., after being in business in the garment center for 50 years, and Watman Hats, with 10 employees, which moved to Brooklyn.
Despite such advantages as proximity to the marketplace and shorter lead times, apparel jobs have moved out of New York in the past 26 years to countries with cheaper labor costs. Apparel and textile manufacturing jobs in the city have remained relatively constant in the last few years, rising slightly in 1996 and 1997, but staying flat in 1998, and now hover around 75,000, according to the U.S. Department of Labor. The peak of New York’s apparel manufacturing was in 1973, when there were 400,000 jobs.
“The jobs of 75,000 New York garment workers and of 48,000 other workers in related apparel wholesaling are in danger as real estate interests seize the opportunity to evict manufacturing tenants and inflate their rents in line with a booming stock market,” said May Chen, vice president of UNITE. Despite the protests of UNITE, many factories and showrooms probably will move off of Seventh Avenue and onto side streets, where rents are slightly lower, according to real estate experts. It could mark, in the next decade or so, the next shift of New York’s fashion center, following a long history of moves throughout the city, as reflected by a panel discussion at the Municipal Art Society last week.
In addition to the panelists’ personal trials, there was also mention of some of the challenges the industry has faced. As a curtain raiser, Steve Long, curator of the Lower East Side Tenement Museum, and Laura Hansen, co-director of Place Matters, which sponsored the event, highlighted some of the major changes.
In the late 1800s, Orchard Street on the Lower East Side was the hub of the garment district; about 100 businesses were set up in tenements. In 1886, the state established a team of factory inspectors to crack down on child labor and six years later banned the use of apartments as factories. By 1915, most dress shops were practically banished from residences.
Around that time, apparel manufacturers followed department stores and men’s wear companies that were setting up shop along Fifth Avenue in the Twenties and Thirties. But the tony department stores threatened factories with a boycott because of the poor appearance they created in the neighborhood, so manufacturers moved west, between 33rd and 59th Streets.
Several speakers discussed the industry’s future.
Leo Reis, the former secretary of the Piece Goods Salesman Association, a precursor to the Fabric Salesman Guild, noted how that group’s membership had dwindled from 400 to 200 and said the guild was struggling to exist. The association has been forced to move its offices from the McAlpin House on West 34th Street due to increased rents.
“There’s too much offshore textile production. The only good part of the garment industry was that it was fun and fast years ago,” Reis said. “The point is, the industry is dying, unfortunately. Many of my friends are losing jobs and they can’t find new ones.”
With more nonapparel companies moving into the garment district, some questioned how the industry could maintain its identity.
Alfred Solomon, a former milliner and principal of Madcaps, said, “I think they’re fighting a losing battle because all the neighborhoods in New York are changing. They’re gentrifying. Even on the Lower East Side, people are moving in from other districts.”