Controversy Over Development At New York’s Seaport Historic District

On January 5th, 2021, the City of New York’s Landmarks Preservation Commission held a virtual public hearing at which more than a hundred people testified about Howard Hughes Corporation’s proposal to build a 47-story residential building at 250 Water Street in Lower Manhattan, at the heart of the South Street Seaport Historic District.

Fights over the appropriateness of tall buildings in Historic Districts are not unusual in the City of New York, but this one is uniquely centered on the purposes of historic preservation and the role cultural institutions play in helping to build and sustain communities, and themselves.

The proposed $1.25 billion project by the Howard Hughes Corporation would require the changing of zoning rules enacted in 2003 to allow buildings more than 12 stories tall. The company is offering a $50 million subsidy to stabilize the economic situation of South Street Seaport Museum, which proponents of the proposal say is a linchpin of the Seaport District and necessary to its survival.

Some cultural resource advocates are taking the unusual step of supporting loosening of the Historic District rules, saying the City can’t afford opposition to a project that would support the Museum and by extension the Historic District, one of its most important historic assets.  The question is complicated by the important role the Museum played in establishing the Historic District and contributing to the revival of Lower Manhattan fifty years ago.

Some History of the Seaport District

There had been much shipping industry in the city of New York before and during the American Revolution, when the British made the city their headquarters, and yet the port lagged behind Philadelphia in size and economic importance. This began to change after the War of 1812, when there was increased immigration and transnational trade, much of it arriving at the docks and deep anchorages along the East River, the landing area for most sailing ships.

In 1818, Jeremiah Wright and four other Quaker shipowners announced the formation of the Black Ball Line, a trans-Atlantic packet ship company, which ran from South Street to Liverpool. Departing from the tradition of only sailing when a ship was filled with cargo, the Black Ball Line adhered to a schedule – every two weeks, with the ship was fully loaded or not. The innovation allowed better planning for the transportation of goods and people along with consistent and earlier access to information from Europe and helped propel New York’s economic development in the 1820s.

Around 1830, partly as a result of local shipbuilding, but more directly a result of the opening of the Erie Canal, New York surpassed Philadelphia as the nation’s largest port.  The South Street area at this time was a bustling center of maritime commercial activity. By the late nineteenth century however, as sailing ships were eclipsed by steamships and the railroads and less waterfront space was needed by maritime interests, the South Street area, like many older docklands of the period, began a period of economic decline.

The adjacent Financial District expanded however, so that by 1900 the city had become the center of the nation’s financial industry. After the Crash of 1929 and the Great Depression development in the Financial District slowed. But after the Second World War employment and economic activity there rebounded and real estate development began to increase.

In the 1950s, several major office buildings were constructed – notably those at Chase Manhattan Plaza and Marine Midland Plaza – helping to transform Lower Manhattan and Wall Street into a what was primarily commercial real estate.

By 1960, there were few residential buildings in the Financial District and relatively few people lived in Lower Manhattan. By then, the blocks around South Street consisted largely of decrepit low-rise warehouses and commercial buildings – relics of the era of sailing ships.  The seaport had however, also become the city’s largest area of remaining early-nineteenth century development. Many assumed these historic buildings and streetscapes would soon be converted to high rises.

Instead, in 1967 Peter and Norma Stanford recognized the historical importance of the South Street area (Peter was a Wall Street executive with a love of maritime history). Along with others, they formed the South Street Seaport Museum whose purpose was to educate New Yorkers about their maritime past by creating a “living Museum” from the area’s buildings and piers. An integral part of the Museum would be the acquisition of nineteenth century sailing ships (tall ships) which would be docked at the adjacent piers (now known as the Street of Ships). Organizer believed that commercial developers and the City would support revitalization of the historic buildings and promote greater use of the piers, if only they knew about their importance.

But in the 1970s, the City of New York, like much of America, faced an economic crises. By 1975, employment was shrinking, the prices of real estate were in significant decline and the City’s bonds went into default.  A number of Wall Street brokerage firms went bankrupt and after the federal government refused help many business leaders said the city might never really recover. In these dark times for Lower Manhattan, South Street Seaport Museum provided inspiration to many New Yorkers who believed that the City, by looking to its past, could find a way to a more prosperous future.

For the nation’s bicentennial in 1976, the South Street Seaport Museum (in an effort led by the museum’s public relations head Frank Brainerd) organized Operation Sail. When ten tall ships from around the world visited New York Harbor on July 4 1776 there was an outpouring of positive feeling about the city’s prospects.

The South Street Seaport Historic District was listed on the National Register of Historic Places in 1972. It was expanded in 1977 and designated a city Historic District by the Landmarks Preservation Commission that same year (it was expanded again in 1989).

A Historic District Revival Spurs Development and Controversy

In the late 1970s and early 1980s Americans began to reject the previous New Deal and Great Society approach to governance and sought to shift to a more business oriented vision for the country. In certain respects this was reflected in the election of the iconoclastic Mayor Koch; in the rise of brash entrepreneurs such as Bruce Wasserstein and Micheal Milliken (who helped reshape Wall Street); and in the rise of aggressive real estate developers and self-promoters such as Donald Trump. By the mid-1980s, the City’s economy, and particularly Wall Street’s, had significantly improved and in the forty years that have followed there was a renewal in Lower Manhattan as a residential area and economic center of the City.

During this period, a number of real estate entrepreneurs (including immigrants such as Zev Bomelgreen and Tamir Sapir) realized that residential apartments could now command higher per square foot prices than offices. They began buying up commercial buildings, such as JP Morgan’s headquarters at 23 Wall Street, and converting them to upscale residences. These residential conversions had a significant impact on the character of Lower Manhattan. Now there are an estimated 70,000 full-time residents living in what had been almost exclusively a district of major office buildings 25 years earlier. These residents are a source of some opposition to the Hughes project.

The Seaport Museum and the success of Operation Sail, also combined with somewhat lower real estate rents than in midtown to spur a proliferation of small specialty museums and related cultural organizations in Lower Manhattan. These include Fraunces Tavern Museum, the Museum of American Finance, the Museum of the American Indian at Bowling Green, the Skyscraper Museum, the Museum of Jewish Heritage, the Chinatown Museum, the Tenement House Museum, Culture Now and the Bowling Green Association. (Representatives of a number of these institutions joined the recently founded Lower Manhattan Historical Association).

Although it had been one of the pioneering cultural institutions in Lower Manhattan in the 1970s, in the final analysis the South Street Seaport did not attract enough tourists, never really gained the necessary financial support from the City, or its residents, and by 2010 the Seaport Museum was nearing bankruptcy. This crises was exacerbated by major damage suffered during Hurricane Sandy in 2012, which sidelined a merger with the Museum of the City of New York.  A number of real estate developers sought to erect large buildings while promising to fund the Museum. Many of these were turned down by the Landmarks Preservation Commission and none materialized. The South Street Seaport was named one of America’s 11 Most Endangered Places in 2015 by the National Trust for Historic Preservation.

Enter the Howard Hughes Corporation, a Texas spinoff of Howard Hughes Medical. The Hughes Corporation was generally considered a more enlightened developer of the area and has provided financial support to a number of community organizations and cultural nonprofits, including the Seaport Museum, now led by Jonathan Bouleware. Since the Museum sold off one of its ships, the Peking, Bouleware has sought to rebuild the organization’s assets, but says he is stymied by a lack of sufficient public and private support. For this reason, he believes the $50 million contribution from the $1.25 billion Hughes project is critical to the survival of the Museum, an opinion shared by South Street Seaport board chair Brendan Sexton.

Debate was heard in the nine-hour Landmarks Preservation Commission hearing on January 5th.  Manhattan Community Board 1, after holding five hours of public hearings of their own a week earlier, presented to the Landmarks Commission with a resolution rejecting the project as out of scale and inappropriate in a residential neighborhood, in addition to being contrary to existing zoning rules.

Opposition to the project also centered around Save Our Seaport, which has been arguing for greater protections for the District and its historic neighborhood, including protection of its Brooklyn Bridge and Street of Ships sight-lines. They support the recommendations of the Seaport Working Group and the restoration of access to Seaport piers for visiting historic ships. You can read about them here.

At the Landmarks Commission hearing Manhattan Borough President Gale Brewer and City Councilwoman Margaret Chin, both members of the Seaport Working Group, surprised many by speaking favorably about the project, as did a number of prior chairs and members of the Landmarks Preservation Commission.

Noted New York historian Kenneth Jackson, a former member of the Seaport Museum’s board, and later the chair of the New York Historical Society, also supported the project. The argued that projects which are necessary to fund facilities like the South Street Seaport Museum are essential to the city’s ability to retain its status as an international center. This theme was picked up by other supporters of the Project, including the Lower Manhattan historical Society.

On January 12, the Landmarks Preservation Commission decided to take no immediate action  – so the debate continues.

Postcard showing South Street and Brooklyn Bridge (c. 1900) published by the Detroit Photographic Company.