Zonebusting! Developer Turns To Scare Tactics As Zoning Reform Heats Up
Real estate development group.
By AARON RUTKOFF
When 61-year-old Beverly McDermott sorted through her mail last week, she found an unwelcome surprise. Mixed in the regular bundle of correspondence, bills and advertisements, McDermott discovered an urgent letter from a real estate development group called City Success Corp.
In a mass mailing that began “Dear Sir or Madam,” City Success offered to purchase McDermott’s residential property in Flushing before impending zoning changes make her land all but worthless.
“Once the zoning in your neighborhood is changed most lots will not be good for development,” the letter warned. “If you have been waiting to recover on the investment you made this is the right time.”
To make its message clear, City Success added in bold: “You must cash out NOW.”
A Growing Trend
McDermott is not alone. Other property owners from Bellerose to College Point have said that they have received the same exact letter from City Success. Though there is no way to conduct a complete survey of people who received the offer, all those who spoke to the Tribune, some off the record, were longtime Queens residents around retirement age.
“To see this happen it makes you feel like you are slowly being strangled to death. That’s how I feel about it,” McDermott said. The tone of the letter, which McDermott felt was intended to create an atmosphere of fear, was “threatening and outrageous, totally outrageous.”
McDermott’s home on Poplar Avenue near Kissena Park, where she has lived for decades with her husband Willard, adjoins an undeveloped 3,000-square-foot lot that she also owns and uses as a garden. The vacant lot has become a prime target for developers far and wide, she said, who often send her solicitations to see if she would consider a sale.
According to McDermott, however, the City Success letter marks a drastic change in tactic from the typical expression of interest by developers. With constant references to the impending rezoning of Queens neighborhoods — including attached maps purporting to show neighborhood zoning designations before and after the change, as well as two full pages of alleged quotes from City Planning press releases and real estate investment publications — the City Success letter marks the first time a developer has directly tied a solicitation to the zoning reform movement, which has become widespread and politically urgent in the borough.
To the Letter’s Defense
A representative from the Richmond Hill-based City Success Corp, who gave her name as Laura, denied that the company has used scare tactics in its approach to Queens property owners. The solicitation letter, she said, was sent out to people across the borough in neighborhoods currently slated for rezoning with an honest view of the situation.
“We are just telling people that there is rezoning going on, which is going to affect the value of their land, which is true,” Laura said. “Now we are willing to pay price top price. Once the zoning changes happen, they won’t be able to get the same price.”
According to the representative, City Success Corp is not a real estate broker, but an investment and development group that seeks to buy only vacant lots. “Every single letter has a specific block and lot that is of a vacant lot with nothing on it,” she said.
Laura also described City Success as a fairly new company, saying the group intends to build two- and three-family homes in Queens before new zoning regulations place restrictions on higher density development.
“We are not telling people run for your life. We are telling people there are zoning changes that the city is doing,” she explained. “This [land] may be their life savings that they are waiting to retire on. All we are saying is that in the future it won’t be worth as much as it is right now.”
Is It Legal?
But elected officials who learned of the City Success letter this week are not so sure that the tactics the group has used are legal. State Sen. Frank Padavan (R-Bellerose), who sponsored legislation creating non-solicitation laws for realtors in Queens, has asked the Secretary of State for an investigation.
“This letter is both misleading, in attempting to scare people in a manner that is both inconsistent with the facts, and possibly illegal,” Padavan said.
After learning of the City Success letter, City Councilman John Liu (D-Flushing) expressed outrage and alleged that the company may have engaged in a form of “blockbusting,” which he defined as the use of intimidating tactics to motivate owners to sell their property. In New York City’s past, “blockbusting” techniques often featured rumors that racial minorities intended to move into predominantly white neighborhoods — sending property values down and causing homeowners to flee.
“Over the decades, that intimidation has taken different forms,” Liu said. “This one is obviously intimidating because it is suggesting that you are going to lose the value of your home once these new rules go into effect.”
In addition, Liu charged that the solicitation letter is misleading because it claims that rezoning will negatively impact the value of property in the borough. “I am actively supporting the rezoning of the Kissena Park area,” he said, “and I believe that once complete it will boost the quality of the residential character of the neighborhood and actually raise the values of those homes across the board.”
Property Values to Drop?
That dark irony bothers Alan Kochta, 53, another resident of Poplar Avenue who received the City Success letter last week. Zoning reform advocates, who dominate homeowners associations across the borough, have pushed their agenda to preserve quality of life and property values in the residential neighborhoods of Queens.
According to these advocates, it is the spread of high-density housing and oversized McMansions that does the most harm to real estate values in residential areas across the borough.
“The changes in the neighborhood are not going to affect property values that much, and if they are, it will go up as a result,” Kochta said. “My concern is that there are some people who aren’t informed, and who in fact are probably elderly, and may get the wrong idea.”
He added, “These people are trying to take advantage of people who may motivated by fear.”
Joe Amaroso, zoning chairman of the Kissena Park Civic Association, also denies that downzoning would send property values in his neighborhood into a freefall. “They are telling them that once the property is rezoned, it won’t be worth anything — but it isn’t true,” he said.
In this situation, however, those with property to sell will need to determine if they fear out-of-character development in their neighborhoods more than speculation that rezoning will decrease property values.
In the Kissena Park area, like many other neighborhoods, rezoning will not be complete until sometime late next year. Meanwhile, any lot purchased for development can avoid the more restrictive zoning regulations soon to come. As long as the foundation for a new home is laid under the existing zoning rules, any future revision will not limit the scope of development.
For Beverly McDermott, no element of fear could compel her to sell her land. “The people who are coming in and doing this developing are absolutely unscrupulous,” she said. “They have no interest in the fact that we have culture of our own and a quality of life that we’ve kept for over a hundred years. Their attitude is if you don’t like what we’re doing, you can leave.”
She added, “I would rather rot on my property than give someone the satisfaction of coming here with a bulldozer and taking it all away.”