Ruben Diaz Jr. (photo: Diaz Jr.'s office)
Development in the Bronx has defined Ruben Diaz Jr.’s borough presidency, now in its tenth year and coinciding with record economic expansion across the city and country coming out of the Great Recession. And Diaz Jr. has defined his borough presidency –– and plans to build his upcoming run for Mayor –– around economic and housing development.
The Bronx has seen $18.96 billion poured into development since 2009, the majority of which has gone to residential units, according to the borough president’s most recent development report. Diaz Jr. releases an annual report on commercial and housing development in the Bronx and holds a celebratory event to tout the investment.
During his 2019 state of the borough address, Diaz Jr. recalled his first address in 2010. “That day, I laid out the beginnings of a conceptual master plan for our borough,” which included “encouraging new developments of all types,” he said. “Our work over the past decade in the Bronx has had a powerful impact,” Diaz Jr. declared before praising low unemployment rates.
Since the start of his tenure as the Bronx’s top figurehead, Diaz Jr. has espoused a vision of growth in the borough driven by community-centric development, where housing and employment opportunities flourish for Bronxites across the economic spectrum, and displacement is avoided. In short, all the good of gentrification without the bad.
It’s a vision of relatively rapid improvement for the borough with the highest, but decreasing, poverty and crime rates that creates opportunity for struggling Bronxites and attracts new people to the Bronx to set up or work at new businesses and obtain reasonably-priced housing and reasonable commutes to Manhattan.
As Diaz Jr. begins his campaign for mayor ahead of the June 2021 Democratic primary that is likely to all-but-decide the city’s next chief executive, assessing how well he has executed his vision and his overall legacy is challenging, in part because the position of borough president is largely ceremonial and coordinative.
Helping to usher in development is one concrete way in which the job of borough president can be performed, though, and given how Diaz Jr. heralds his tenure on the subject and plans to center it in his mayoral run, it is an essential area to dissect.
The reality of Diaz Jr.’s tenure when it comes to development is of course complicated, and reality is a bit murkier than the borough president presents in his public comments.
While development has proliferated in the Bronx, with dozens of land use rule-changes approved since 2009 to help developers build more and bigger, unemployment is still higher than the rest of the city, homeownership rates are still low, and some Bronxites have been displaced. And the true impacts of some development and land use decisions won’t be felt for years more to come.
Diaz Jr., consistently burnishing a reputation as a pro-growth leader of the city’s poorest borough, has staunchly denied that significant displacement has occurred and has fired back at critics who say otherwise.
In 2015, a professed resident of the south Bronx called into WNYC’s The Brian Lehrer Show –– which was hosting Diaz Jr. and Manhattan Borough President Gale Brewer to discuss gentrification and de Blasio’s then-new Mandatory Inclusionary Housing plan –– to implore Diaz Jr. to “wake up” in the face of what the caller deemed “out of touch” leadership in which “people are being pushed out daily.”
The borough president shot back. “No one can prove to me that we forced one community out to bring another one in,” he said. “If you look at all of the 17,000 units of housing that I’ve been a part of in the last six years, the overwhelming majority of that have been for low-income. Unfortunately, there's folks like yourself and others who have your own agenda and you're not in reality. You're not really paying attention to all the good things that we're doing.”
Diaz Jr. told the caller about a land use hearing he held with the community that he “didn’t have to have,” a common refrain from the borough president when he exceeds the technical duties of his office (which has limited powers but does influence land use matters), during which he listened to “more than 50 testimonies” and voted with the community against the early iteration of the mayor’s Mandatory Inclusionary Housing program.
MIH requires certain amounts and levels of income-targeted “affordable housing” within larger projects when developers receive city permission to build bigger than previous land use rules would allow (otherwise known as an upzoning). Questions have long abound as to whether the city’s income targets for “affordable housing” are really appropriately low enough to match New Yorkers in most need.
The borough president went on to say that the unemployment rate was cut by half during his tenure, that his administration “has done three developments for military veterans” –– a specific concern from the caller, a veteran who said he’s not receiving proper help –– and that he created jobs.
Diaz Jr. was largely correct in his assessment of the Bronx’s economic growth -- housing and jobs have expanded greatly over the last ten years in a borough that had immense opportunity for investors, especially as crime has also dropped significantly in recent decades and the city’s population has steadily climbed. The Bronx also offers a great deal of parkland and key long-standing attractions like the Bronx Zoo and Yankee Stadium.
“The Bronx is booming, so Ruben can certainly beat his chest with that,” said Bob Kappstatter, a political and media consultant, and longtime former Bronx bureau chief for the New York Daily News.
But the question of whom deserves credit for these benchmarks is complicated.
Unemployment has fallen drastically and job creation has surged in the Bronx over Diaz Jr.’s borough presidency; but he assumed the position in 2009 just after the economic crash and carried out his limited duties during a time of historic national and citywide growth. Developers and investors clearly began to see the Bronx as a more desirable place to do business, and it likely helped to have a borough president who rolled out a welcome mat.
Diaz Jr. has helped build housing for veterans and other Bronxites with special needs, but he’s also backed luxury developments that have priced locals out, rent burden rates continue to soar, and the tenant eviction rate in the Bronx is dramatically higher than anywhere else in the city.
Overall, Diaz Jr. has supported diverse development projects, from high-end housing to NYCHA infill and 100% “affordable” buildings, using what he calls a neighborhood-by-neighborhood approach to achieve his goal of a mixed-income borough. It’s an approach that has largely been in line with both mayors, Michael Bloomberg and Bill de Blasio, who have held office during his tenure as borough president, and whom he hopes to succeed come January 1, 2022 on a campaign platform that will center on his record of bringing development to the Bronx.
An Especially Strong Borough President
The primary responsibilities of borough presidents are providing guidance on land-use matters, appointing community board members, and serving as an ambassador for the borough. While borough presidents have few binding powers, they can show significant strength with the right allies to push their agenda forward.
“Borough presidents are cheerleaders,” said Kappstatter, “and he’s done a pretty good job.”
Diaz Jr. has amassed significant power in the Bronx as part of a small group of officials leading the county’s Democratic Party apparatus, most notably state Assembly Speaker Carl Heastie, who led the county party until his 2015 ascension to the powerful speakership, and current county party chair Marcos Crespo, who serves in the Assembly. The Bronx Democrats are intensely focused on electing Diaz Jr. mayor in the 2021 election. Crespo, Heastie, and Diaz Jr. closely run Democratic politics in the borough as tightly as possible.
The borough president also has an important close relationship with Governor Andrew Cuomo, now a third-term Democrat, and many members of the state Assembly (where he served from 1997 through 2009), state Senate, and City Council, where his controversial father, Ruben Diaz Sr. now serves. With Cuomo, Diaz Jr. appeared to be developing an especially close bond, with the governor regularly hosting events in the Bronx where he and the borough president would heap praise on each other. That pattern has slowed recently.
Meanwhile, Diaz Jr. often finds himself having to distance himself from his father’s remarks and positions, especially on LGBT and women’s rights issues.
Diaz Jr. worked well with former Mayor Bloomberg, with whom he shared a more aggressive vision of development, but has clashed with Mayor de Blasio on several fronts, including the specific terms of Mandatory Inclusionary Housing, wherein Diaz Jr. wanted more flexibility for borough presidents and local officials to negotiate with developers and foster mixed-income housing, and the fate of the Kingsbridge Armory.
The Bronx Democratic Party is an insular but powerful group that works to elect Democrats to every position possible, a highly-achievable goal in the Bronx where Democrats far outnumber Republicans, and supports candidates who will work to elevate each other’s political power. Crespo, who interned for Diaz Jr. in 2003, has led the party since 2015, when Heastie rose to the Assembly speakership and became one of the three most powerful people in state government, along with the leader of the state Senate and the Governor.
During his early political career and time in the Assembly, Diaz Jr. and Heastie became quite close. In 2008, Diaz Jr. was integral to elevating Heastie’s career; as part of the “rainbow rebels,” a small group of black and Hispanic lawmakers, he successfully pushed for Heastie to oust Jose Rivera, a formerly influential Assembly member, as head of the Bronx Democratic Party.
Heastie has been instrumental in constructing new schools and after-school centers in the Bronx, among other spoils that come with heights of political power. And since rising to the Assembly speakership, Heastie holds significant power in setting the state’s legislative and budgetary agenda.
With difficult, expensive projects in the works, like new MetroNorth stations and the planned Kingsbridge National Ice Center, which has stagnated over the years due to a lack of funding, Heastie is a vital ally for Diaz Jr. As is Cuomo, though Cuomo and Heastie have been on colder terms over the past year, which could impact Cuomo’s potential support for Diaz Jr.’s mayoral bid. The 2021 Democratic primary for mayor is expected to be a crowded and highly competitive affair; a race that is already in motion and is expected to kick into another gear in 2020.
Diaz Jr. also works closely with Rafael Salamanca, whom he appointed to a Bronx community board and went on to win a seat in the City Council in a 2016 special election. Salamanca now serves as the chair of the powerful City Council Land Use Committee, the result of a deal reached to help elevate Corey Johnson to the speakership of the City Council. Since that deal, Johnson has emerged as a more powerful political force than some imagined, and is now a likely mayoral candidate in 2021, competing against Diaz Jr. and other likely candidates such as Comptroller Scott Stringer and Brooklyn Borough President Eric Adams, and whomever else may throw their hats into the ring.
These relationships enable Diaz Jr. to advance his agenda (and build his brand) through New York’s complex governmental processes and bureaucracies, from the start of the city land use process at the community board level all the way through the City Council, with support at the highest levels of state governance. Diaz Jr. will have whatever weight the Bronx Democratic Party can bring to bear for his mayoral run, and the machine’s often close relationship to its Queens counterpart could also be helpful (Heastie and Diaz Jr. both recently endorsed Queens Borough President Melinda Katz in her Queens Democratic Party-backed run for District Attorney.)
Unsurprisingly, Diaz Jr. has another layer of support from the real estate industry, as evidenced by his approach to development and campaign donations he has received.
A Gotham Gazette analysis of Diaz Jr.’s filings with the city’s Campaign Finance Board shows that 38% of contributions of $1,000 or more to his three borough president campaigns came from individuals in the real estate industry, including developers, realtors, architects, and construction firms.
“Campaign finance considerations have no influence on the work of the borough president and his office,” Diaz Jr.’s office told Gotham Gazette in a statement.
In recent months, Diaz Jr. has spent substantial time courting developers and investors, in addition to meetings with close allies, according to considerably redacted copies of his daily schedule from February through April of this year, attained by Gotham Gazette through the Freedom of Information law. The schedules show the borough president’s appointments and their locations, but appear to repeatedly black out the topics of the specific meetings, whether with developers or former Bronx Borough President and mayoral candidate Freddy Ferrer, or others.
Goals and Rhetoric Compared to Reality
Diaz Jr. has helped champion and spearhead development in the Bronx, with a stated goal of rendering the borough a destination that New Yorkers want to move to rather than leave. He has argued that doing so requires a diverse economy with residents of all income levels, while striking the right balance between development and community benefit.
In 2009, as Diaz Jr. delivered his inauguration speech to an adoring crowd in Lehman College in the aftermath of the economic crash, he told the people of the Bronx, “Perhaps the most important piece of our agenda is going to be economic development.”
Over the following 10 years, Diaz Jr. has sought to bear out his vision through mass development, creating job, housing, commercial, and recreational opportunities. But at the same time, he’s promised to keep the community at the core of his actions. In his view, he said in 2010, “When developers want to do business in our borough, they must do what is right for the entire Bronx and not just themselves.”
“We cannot accept that the minimum wage is the best salary a developer can offer while they take so heavily from taxpayers’ wallets,” Diaz Jr. continued. “If you want charity, you must be charitable. If you want a public benefit, your project must benefit the public.”
As he pushed for balanced development, Diaz Jr. criticized Mayor de Blasio’s Mandatory Inclusionary Housing plan, which mandates that developers allowed to build bigger than they otherwise would be able to set aside a certain portion of new housing at “affordable” rents.
Diaz Jr. pushed the City Council to vote against an early version of the plan in 2015, as did many other city officials and community board members. Though, he had a more complicated argument than most critics, who largely said that the MIH plan did not go far enough to mandate deeply affordable housing: Diaz Jr. wanted more options for local officials to use to negotiate with developers, both in terms of lower- and higher-income regulations. He issued a statement at the time that read, “the proposal as it stands would not fully realize the goal of truly mixed-income communities.”
After pushback from a broad cohort of city officials and others, de Blasio offered a new MIH plan in 2016 with a broader variety of thresholds for affordable housing “bands” that could be selected during a rezoning. “While the housing deal does not go as far to assist the low income community as many of us had hoped,” Diaz Jr. wrote in a statement at the time, “it is an encouraging step in the right direction.”
Two years later, Diaz Jr. praised the construction of Martin Luther King Plaza in Mott Haven, which contains 166 affordable units, 67 of which are permanently affordable. Forty-six of the permanently affordable units were “made possible through MIH,” a 2018 statement from Diaz Jr. reads. Many Bronx developments are taking place under new MIH terms, whether through a neighborhood rezoning or specific plot upzonings that trigger MIH.
Monxo López, adjunct professor of Latino studies and politics at Hunter College and co-founder of activist group South Bronx Unite, said that the borough has undergone a sudden change after the decades of systemic disinvestment, blazing fires, and the dereliction of housing.
Now, he said, “we see an over-interest in exploiting our land, the value of our land, a land that is valuable and has become valuable because of the real existing efforts to make this place––meaning Mott Haven and the South Bronx, and the Bronx in general––a livable place.”
Meanwhile, Diaz Jr. has remained rhetorically committed to community-centric development, which he championed in his 2014 state of the borough address. He pointed to the Kingsbridge Armory as the paragon of his vision for the Bronx: the former military structure is set to be developed into an ice rink, after long discussions with community members to ensure protections of local jobs and housing. The project has been severely stalled.
“We have set a new standard for responsible development. That, ladies and gentlemen, is planning with a purpose. That, ladies and gentlemen, is the Diaz doctrine.”
The reality in the Bronx has been complicated.
While development has superficially improved the Bronx, replacing burnt out or vacant lots with new buildings, the community of people who already lived in the borough, especially its most downtrodden and poor areas, is not always the recipient of growth.
“It’s like both things are going on at once,” said Elliott Liu, an activist in the Bronx and graduate student in anthropology. “You have all sorts of new buildings going up...but at least a handful of people get evicted.”
A 2019 report from the Association for Neighborhood and Housing Development (ANHD) showed rampant threats to affordable housing in the Bronx.
Mott Haven and Kingsbridge are home to some of the highest rates of housing price change in the city. And of the 10 neighborhoods with the highest number of evictions executed by court-ordered marshals in 2018, seven were in the Bronx. The report also ranks six Bronx neighborhoods in the top 11 neighborhoods citywide undergoing serious threats to affordable housing.
“Homelessness is still a big issue, and where is homelessness coming from? Gentrification and rising rents,” said Kappstatter. But, he added, “you can’t blame Ruben on this one, this is a citywide issue.”
Massive economic growth characterized the economy over the past ten years, especially in New York City, and the effects spread to the Bronx. According to a state comptroller report, since 2010, the number of businesses in the Bronx has grown by 17%, reaching nearly 18,000, and the population of the Bronx has been the fastest growing county in the state, largely driven by immigration.
In 2017, unemployment in the Bronx reached its lowest point since 1990 at 6.2%, according to the state comptroller report––but that still leaves Bronx County behind, with the seventh highest unemployment rate in the state and higher than the citywide rate of 4.5%.
After a difficult history of a decreasing population and divestment from housing, the Bronx had 498,500 occupied housing units in 2016, according to the state comptroller report. That number has remained fairly steady since Diaz Jr.’s earliest years in office; in 2010, the Bronx housed 472,464 occupied units, according to the U.S. Census Bureau.
Other housing metrics show a bleaker picture of the borough over the past ten years: 60% of Bronx households put at least 30% of their income toward rent, “higher than in any other borough and six percentage points higher than the citywide share,” according to the state comptroller report. The number of households who used half their income for rent grew by 19% between 2007 and 2016.
Bronx County has the second lowest rate of homeownership in the country, though Manhattan and Brooklyn follow closely behind, according to a 2016 study from New York University’s Furman Center and Citi. The most recent available federal data on homeownership shows a rebound in the Bronx’s homeownership rate starting in 2016 after a steady decline in 2009, following the recession that included the home foreclosure crisis.
Eviction numbers in the Bronx further challenge the notion that development will lead to affordable housing for all: 6,858 tenants were evicted in the Bronx in 2018––more than any other borough, while it has the fourth-highest population, according to City Council eviction data. The eviction rate in the Bronx is one eviction per 79 units. The next highest rate is one eviction per 180 units, in Brooklyn, and Manhattan has the lowest eviction rate at one per 345 units.
“For the past decade,” said Diaz Jr.’s spokesperson, John DeSio, in a brief written statement to Gotham Gazette, “the borough president has worked assiduously to build affordable housing and fight displacement, create new jobs, protect NYCHA residents, improve health and educational outcomes, and continue to make the Bronx an even greater place to live, work and raise a family.”
Though Diaz Jr. has promoted commercial development, job growth has not necessarily followed.
Many other commercial development projects that Diaz Jr. has favored have been concentrated in Mott Haven. But the unemployment rate in the neighborhood is at 16%, according to a 2015 study from the Health Department. And Co-Op City, the neighborhood home to the Mall at Bay Plaza––a development project Diaz Jr. praised as a major success––has seen some of the lowest job growth in the borough, according to the state comptroller report.
Diaz Jr. once fully welcomed the Trump Links project in the Bronx’s Throggs Neck neighborhood, but he has since walked his enthusiasm back. In his 2014 state of the borough speech, Diaz Jr. hailed the golf course as a harbinger of job creation and prosperity. “Donald Trump understands the power of his brand, and we are now partners. That is the ‘New Bronx.’”
The golf course opened in April 2015 and Diaz Jr. was one of the first golfers to play on the course, according to DNAInfo. But when Trump announced his presidential campaign that June using racist rhetoric, Diaz Jr. decided to boycott the course. He had already been vexed by Trump’s marketing of the golf course as located in “Ferry Point,” according to DNAInfo. He argued the advertising obscured the golf course’s connection to the borough as it is not the name of any of the Bronx’s neighborhoods. Business at the golf course slumped since Trump assumed the presidency, according to the Washington Post. Diaz Jr. has repeatedly condemned Trump on a slew of the president’s statements and policies.
“Our work over the past decade has borne real fruit,” Diaz Jr.’s spokesperson wrote. “We are shedding the stigma that has dogged this borough for so long, and we are building a brighter future for everyone.”
Several examples show Diaz Jr.’s approach to major projects that will in part determine his legacy as borough president and the future of affordability and opportunity in the Bronx.
La Central and Mixed-Rate Development
Mixed-income development is at the crux of Diaz Jr.’s plan for the Bronx, and perhaps, if he ascends to the mayor’s office as he hopes, for the city at large. Diaz Jr. has touted his case-by-case approach to development with resources allotted as necessary.
La Central, if all goes according to plan during its construction, will test this approach. The project embodies the tensions at the heart of the development debate in the Bronx: it will reserve housing for the borough’s most vulnerable citizens, coupled with glossy amenities like a recording studio.
Leaders across the state praised the five-building La Central development, designed to function as a community space as much as a housing complex. The buildings in the Melrose neighborhood are slotted to fill a formerly vacant lot with more than 800 units of sub-market rate (“affordable”) housing.
Land use documents show that La Central plans to bring 832 “affordable” housing units to the borough –– defined as scaled for Bronxites who earn 30-130% of the area median income –– including 160 units reserved specifically for homeless veterans and Bronxites with HIV/AIDS. The complex will also host community spaces including a YMCA, daycare services, a 25-story Astronomy Tower, farm space, a skate park, and a recording studio. Locals have sought to reserve half the units for residents of Melrose and the nearby Mott Haven and Port Morris neighborhoods, in addition to efforts to hire locally.
The buildings are also situated near the shared 2 and 5 train station, a Metro-North stop, and several bus stops, in the vein of increasingly popular Transit-Oriented Development, which seeks to create more housing near transit hubs and decrease reliance on cars globally.
“La Central is an exemplar proposal that will fill a gaping void that has plagued The Hub for decades,” Diaz Jr. said at the time. The project earned the unanimous approval of the City Council after it was pledged to reserve a number of apartments at rental rate of $640 per month and the use of union labor for construction.
Breaking Ground, Hudson Companies, BRP Companies and ELH-TKC are each developing parts of La Central, with $100 million of funding from Wells Fargo.
“I want to note the level of outreach the development team has given to my office,” Diaz Jr. wrote in his non-binding approval of the project in June of 2016, complimenting the regular conference calls that he said developers set up and their willingness to change the buildings’ design to better fit with the Bronx’s “warmer color” aesthetic. “I welcome this diverse, truly mixed-use, transit oriented development. I am proud to have contributed $1.5 million toward its development.”
The project has hit some logistical snags along the way.
The Department of Buildings recently placed a stop work order on one of La Central’s buildings after a loose piece of equipment injured a construction worker’s neck and landed him in the hospital. The building received a more minor stop work order late last year after contractors failed to properly update the Department of Buildings, though it was later rescinded.
The Westchester-based construction company, Mountco Construction & Development, has been charged with a host of violations since the project broke ground, resulting in a total of $28,145.95 in fines for the two buildings slated for full affordability, compared to the other three mixed-rate buildings. Mountco could not be reached for comment.
The architect, FX Collaborative, has designed buildings across the world, from Dubai to Hudson Yards. It holds social responsibility as one of its foremost principles and wrote that their design for La Central “will provide a diversity of environments connected to the larger context.”
Residents harbor mixed feelings toward the project. “La Central is continuously called a ‘transformative’ development for the Bronx, but what does that mean for the local residents?” Ed García Conde, founder of welcome2thebronx.com, wrote. “Gentrification and displacement.”
Construction on La Central started in June 2017 and the first building is slated to open this summer.
Compass Residences and Luxury Development
This 1,279-unit market-rate development under the Third Avenue Bridge lies at the epicenter of gentrification in the South Bronx, alongside a coffee shop with $4 lattes, several restaurants, boutiques, and gyms.
The original developers, Somerset Partners and Chetrit Group, laid out their vision for the South Bronx’s future as “Williamsburg meets DUMBO.” Diaz Jr. nodded to the project in a 2015 speech citing the “complete metamorphosis of the Harlem River waterfront.” Last year, however, after a tumultuous three years of development, Somerset and Chetrit sold to Brookfield Property Group after Diaz Jr. courted Ric Clark, the company’s chairman, with a tour of the Bronx.
“From just south of the Third Avenue Bridge all the way to 149th Street,” Diaz Jr. said in 2015, “We found the opportunity for thousands of housing units of all kinds, new waterfront access, and park space.”
While residents hold varied feelings about gentrification, with some concerned about displacement and others who welcome new amenities, a near consensus emerged against the project’s original developers. The developers threw an infamous warehouse party with a “Bronx is Burning” theme that saw glamorous celebrities posing against fake bullet-ridden cars, harkening back to the Bronx’s difficult past, epitomized in the 1970s and ‘80s.
Somerset Partners notoriously sought to rebrand the South Bronx as the “Piano District” and plastered billboards in the area that promised “luxury waterfront living.” The billboard enraged locals and sparked the hashtag #WhatPianoDistrict among Bronxites who viewed the moniker as an erasure of the thriving community already in place. The group did not return repeated requests for comment.
Though Diaz Jr. himself disapproved of the “Bronx is Burning” theme and the “Piano District” moniker, they are emblematic of the types of mindsets that he has welcomed to the Bronx through his approach to pursuing development and a sense of the Bronx as a destination with at least some luxury experiences available.
Somerset and Chetrit sold the development to Brookfield Properties in 2018 for $165 million, the New York Post reported at the time. “Brookfield’s interest in the Bronx accelerated when Borough President Diaz invited Brookfield Properties’ Ric Clark on a tour of the borough,” said a spokesperson for the company. Brookfield Properties expects to reserve 30 percent of the units for sub-market rate housing, which would allow the company to claim a tax break.
The architecture firm, Hill West, partners with luxury developers, like the Trump Organization. Their history of community involvement includes contributions to major nonprofits like Habitat for Humanity, the SkyScraper Museum, and the Queens Library Foundation. The two buildings are currently under redesign to “optimize the functionality of the site,” according to a spokesperson from Brookfield Properties.
The Department of Buildings issued a stop work order to the Lincoln Avenue property last August for permit issues after two similar complaints. The violations have not yet been resolved and may result in a fine of just over $2,000.
FreshDirect and Community, Labor Tensions
In February 2012, Diaz Jr. took on the relocation of FreshDirect, the online service that delivers groceries directly to customers’ doors, to the South Bronx from Long Island City in Queens as a major project of his first term as borough president. In the time between then and the opening of FreshDirect’s new Port Morris warehouse in July 2018, the project was marked with bitter controversy.
A bidding war between the Bronx and New Jersey broke out to lure FreshDirect in 2012. A site in Port Morris along the Harlem River waterfront ultimately won out with over $100 million in state and city tax incentives.
When Diaz Jr., alongside Governor Cuomo and then-Mayor Bloomberg, announced the project, it was slated to bring $112.6 million in investment to the Bronx in addition to at least 2,000 construction and 1,000 permanent jobs, including holdovers from the Queens facility, according to the New York City Economic Development Corporation.
Once FreshDirect decided on the Port Morris site, activists sprung into action, denouncing the introduction of an extensive fleet of trucks into a neighborhood already suffering from poor air quality and the highest childhood asthma rate in New York City.
The conflict rose to the courts as activist group South Bronx Unite sued FreshDirect for violating environmental review laws. The state appellate court sided with FreshDirect. Diaz Jr. called the result a “victory not only for FreshDirect, but for the Bronx as a whole.”
FreshDirect exceeded its promise to bring 1,000 jobs, according to the company, which says it has hired 1,500 workers. The jobs now pay at least $15 per hour, in compliance with the state minimum wage.
But FreshDirect has a fraught history with employee unionization through the United Food and Commercial Workers, the group under which the company’s truck drivers are unionized and that has also sought to unionize the warehouse workers (in addition to other union groups). In 2014, 16 city and state officials signed a letter addressed to FreshDirect’s CEO, Jason Ackerman, encouraging the company to work with the union. Diaz Jr. did not sign the letter. In his office’s written statement to Gotham Gazette, his spokesperson neglected to address questions about this issue.
After difficult bargaining between FreshDirect and UFCW in 2014 to raise wages by roughly 20% over three years, from just over $10 per hour, Diaz Jr. said he was “very pleased” they could reach an agreement. Warehouse workers are still not unionized.
Though he shows no clear record of having gone to bat for FreshDirect workers in any meaningful way, the borough president has positioned himself as a champion of labor rights. In January 2018, following the Supreme Court’s Janus v. AFSCME decision, which ruled that public employees could opt out of paying dues, he said, “Our city and state must enact policies that prevent the erosion of rights that have been gained through union organizing and collective bargaining.”
The Bronx is home to 44,292 NYCHA apartment units, according to the authority––the third-highest of the boroughs, after Brooklyn and Manhattan.
Diaz Jr. has frequently spoken out against poor conditions and mistreatment of NYCHA tenants, especially over heat and hot water outages during the winter of 2017 and into 2018.
The borough president has generally been in favor of NYCHA infill plans, or developing new privately-run buildings on NYCHA land to generate revenue for the cash strapped public housing authority through lease agreements. Though there are many forms it can take, infill is often opposed as a form of privatizing public assets and welcoming gentrification to low-income areas. Many infill proposals include a mix of affordable and market-rate housing given that market-rate units can raise more money for both developers and NYCHA.
In 2012, Diaz Jr. approved the construction of three buildings on NYCHA land: two affordable buildings with one reserved for seniors, and a third for more lavish townhouses. Diaz Jr. wrote in the ULURP application, “It is the eventual inclusion of this third phase [of townhouses] that makes this project all the more critical and reflective of my mixed-income community development policy.”
In 2018, Diaz Jr. resoundingly approved the ULURP application for a mixed-use building called Betances VI on NYCHA land with affordable housing, including 30 units for homeless and mentally-disabled Bronxites, and retail space.
“Betances VI represents a unique collaboration that will bring to the Mott Haven community of the Bronx affordable housing, new retail development, and perhaps most importantly of all, accommodations for some of our city’s most needy citizens,” he wrote.
Lemle and Wolff Companies developed both projects. The firm specializes in “construction and management of high-quality affordable housing,” according to its website. Five of the seven company’s principals have donated small amounts of money to one of Diaz Jr.’s borough presidency campaigns for a sum totaling $1,610, according to his campaign finances. That number jumps to $4,730 if including donations from the first principal Joseph Zitolo’s wife, Susan Zitolo. In 2015, The Daily News reported that the company owed $500,000 in backwages.
Community Board 1 disapproved the application, out of concern that Lemle and Wolff Companies would not be held accountable to providing adequate housing for the homeless, or play space for tenants’ children.
In response, Diaz Jr. said he understood the concerns, but that “affordable housing is vital, as too is giving people with a troubled past a chance to achieve success.”
At the same time, he’s spoken out strongly against developing over green space on NYCHA land. “That’s where children go out and play, that’s where seniors go out to sit and get fresh air,” he told The Observer in 2015.
Kingsbridge National Ice Center and Execution Difficulties
After years of contention between city and state officials over the decades-long vacancy of the Kingsbridge Armory, in 2012, a coalition including former Deutsche Bank executive Kevin Parker and a former New York Rangers star Mark Messier, proposed reconfiguring the empty former military structure into the world’s largest indoor ice rink: the Kingsbridge National Ice Center.
The Kingsbridge Armory has sat vacant since 1996 when it became city government property. The Related Companies won a bid to renovate the armory into a shopping mall with the support of then-Mayor Bloomberg. The 2009 proposal, however, resoundingly failed in the City Council with a vote of 45-1 (with some abstentions); the Council then overrode Bloomberg’s veto 48-1, over concerns surrounding traffic and wages for the potential mall workers. Diaz Jr. slammed the proposal, instead pushing for development legislation that mandated living wages for the future ice center’s employees.
A 2012 proposal revived renovation plans for the armory, leading to the Kingsbridge National Ice Center, envisioned by Diaz Jr. as launching the borough to further global prominence. During a 2014 speech, Diaz Jr. honored “the amazing new venture that will bring the world’s greatest ice sports complex ot our borough.”
Though the imposing structure has sat vacant for decades, neighboring residents did fear eventual displacement when the project neared approval. An agreement between the community and developer Kevin Parker, in part brokered by Diaz Jr and Council Member Fernando Cabrera, set in motion the final approval from the City Council in 2013.
According to the New York City Economic Development Corporation, the ice center will generate 890 construction jobs and 267 permanent jobs. Kingsbridge and the surrounding area has the highest unemployment rate in New York City. The Community Benefits Agreement stipulates living wages for all workers involved with the ice center, jobs for Bronxites, women and people of color, free access for local schools, a green action plan, and other clauses envisioned around the local community.
Despite the potential for community benefits, funding the ice center has posed a significant challenge. Issues related to funding also caused significant tension between Diaz Jr. and de Blasio, which came to a boil in 2016.
Previously slated to open in 2018, Parker and his partners are only now in final financing stages and, according to Crain’s New York Business, is projecting an opening in early 2022.
Diaz Jr. Eyes the Mayoralty
“If you’re a good politician,” Kappstatter, the political consultant, said on Diaz Jr.’s mayoral plans, “you’re running right now, not two years from now.”
As Diaz Jr. prepares to launch his mayoral run, the question becomes how his development legacy will translate citywide. He pitched himself as mayor on WBAI’s Max & Murphy radio show in March on his ability to create jobs and build housing, citing the borough’s unemployment and development statistics under his tenure. “We’ve been doing that, not just having businesses do business in the Bronx, but doing business with the Bronx,” he said when asked to give a preview of what his mayoral campaign message will be.
He concluded: “As we speak of equity, that’s going to be the message here. That this is a city here, where we can provide a better future, not just for some for but all. And we can do this together. Wee can do this in a practical, pragmatic, progressive way.”
Diaz Jr. has staked his legacy on his approach to development and pursuing a mixed-income borough, a “New Bronx” with more amenities and opportunities, and the larger picture of increased development in the Bronx over the last decade. He’s clearly preparing to argue that he’s helped lift up the Bronx at minimal cost to its residents in terms of displacement or lack of affordability moving forward.
The Bronx certainly remains a mixed-income borough, both in terms of residents’ earnings and the housing available. The questions for Diaz Jr. include whether he is seen as too close to real estate interests and whether the development he has touted has indeed been good for Bronxites, and how it is perceived.
According to data from the Association for Neighborhood and Housing Development, the borough is home to residents and housing across the economic spectrum in neighborhoods like Mott Haven and Hunts Point, where around 75% of the residential units are rented at market rate. In historically wealthier neighborhoods like Riverdale and Throggs Neck, those numbers jump to 88% and 97.6% respectively. But in lower income neighborhoods like Highbridge, market rate units account for 60.8% of housing.
Diaz Jr. has undoubtedly drawn close ties to the real estate industry, members of which are likely to continue to support him as his political profile grows. He has proven himself business-friendly, but sought the approval of unions, and he’s certainly had an eye on community development, job opportunity, and improving education.
Now with decades as an elected official and political player in the Bronx, he has close ties with many elected officials, club leaders, and others who may be ready to help him get elected citywide. Bringing home the Bronx in a mayoral run will be essential, and the borough is not known for its high voter turnout to begin with.
“Ruben’s eye is totally on the mayoral prize,” said Kappstatter.
“We hope that he goes back to those roots of listening to the community, trying to use his skills and intelligence to fight...for what is right for this borough,” said López, the professor and activist, as he said Diaz Jr. did with the Kingsbridge Armory.
“Will that happen? It’s totally up to him.”