The Industry City Megadevelopment That Wasn’t, and How the Deal Fell Apart

Developers pulled the plug on a major rezoning.

An aerial view of Sunset Park shows a mix of low-rise apartment buildings and row houses that make up the neighborhood.
Industry City sits on the northwest edge of Sunset Park. Photo: Max Touhey
An aerial view of Sunset Park shows a mix of low-rise apartment buildings and row houses that make up the neighborhood.
Industry City sits on the northwest edge of Sunset Park. Photo: Max Touhey

This story was originally published by Curbed before it joined New York Magazine. You can visit the Curbed archive at to read all stories published before October 2020.

On the Sunset Park waterfront is a hodgepodge of warehouses, factories, and piers, historically known as Bush Terminal, that have moved between private and public ownership for decades. The latest effort to reimagine a swath of that area would have seen a 16-building complex known as Industry City dramatically expanded and converted into a commercial hub. But after years of fighting over the Brooklyn waterfront, the developers behind the plan to rezone the campus withdrew on Tuesday — throwing the future of the site up in the air.

The owners — a partnership between Jamestown, Belvedere Capital, and Angelo, Gordon & Co. — sought to further transform the campus from gritty industrial warehouses into a commercial destination with an influx of new retail and educational spaces. In recent months, they tried to convince the City Council to green light the plan over the opposition of local City Councilmember Carlos Menchaca, arguing the rezoning would bring thousands of jobs and new tax revenue. But that political support has failed to materialize. “It is clear that the current political environment and a lack of leadership precludes a path forward for our rezoning proposal,” Industry City CEO Andrew Kimball said late Tuesday.

The eleventh-hour withdrawal marked a victory for community opponents, who argue that the expansion plan — which would have doubled the complex’s retail footprint — would hasten gentrification in the working-class, immigrant neighborhood and eviscerate any chance of bringing large-scale manufacturing back to the area. The decision to abandon the plan, however, is far from the last word on the matter, as the developers are still forging ahead with pared-back plans under existing zoning, and community activists are calling for a green (and wholly different) industrial vision for the waterfront.

What was Industry City’s plan for the waterfront complex?

First floated in 2015, the pitch was controversial from the start, and part of a $1 billion plan to reshape the campus stretching from 32nd to 41st streets between Second and Third avenues. The owners sought to create 1.4 million square feet over the course of 12 years, mainly by constructing new commercial and industrial spaces including several new buildings that would have housed hotels, academic space, and retail shops.

In 2019, Industry City agreed to modify its plans to mollify opposition from Menchaca, whose vote in the Council weighed heavily on the project’s fate. The compromise nixed two additional hotels, reduced the amount of retail space, and reserved some space for industrial use. But by the time the project received approval from the City Planning Commission — a significant milestone in the land-use review process — the developers had yet to remove the hotels from their plan, and the Sunset Park Benefits Coalition, which had formed to hash out a community-benefits agreement with the owners, had yet to finalize a deal.

Where did locals stand on the project?

After a five-hour hearing in January, Brooklyn Community Board Seven remained split on the project, unanimously disapproving some components and deadlocked on others. Meanwhile, community activists (chiefly Protect Sunset Park and the environmental-justice group UPROSE) railed against the plan, arguing that it would supercharge gentrification in a community that is already facing a severe affordable-housing shortage. Menchaca, who in the early months of the public-review process remained undecided, came out decisively against the plan in a July Instagram video, declaring that the redevelopment “will make it harder for working people to live in Sunset Park.” On Wednesday, he lauded the dead rezoning as a “huge win for the Sunset Park community.”

How did the rezoning fall apart?

The developer’s decision to withdraw its application came a day after a half-dozen New York lawmakers, including members of Congress, signed a letter opposing the project. In it, they argued that handing off most of the decisions about the site to a private developer would result in the displacement of working class residents.

An uncommon fissure had also emerged in the City Council, with some members supporting the plan despite Menchaca’s opposition, pointing to the 20,000 jobs and $100 million in tax revenue the project would generate, both of which are attractive to a city currently grappling with a pandemic-induced economic depression. Those lawmakers — politicians from across the boroughs — urged the Council to ignore the longstanding tradition of deferring to the local representative on land-use matters and to approve the plan.

So far, City Council Speaker Corey Johnson has demurred, but he gave a glimpse of his thinking at a press conference last week, saying “it’s important not to paper over” opposition from local politicians. Mayor Bill de Blasio, on the other hand, has stayed out of the issue entirely. That lack of political will set off alarm bells for Kimball, who conceded late on Tuesday that “the leadership needed to approve this development failed to emerge.”

“Over and over, we have heard from key decision makers that while the substance of the project is strong, the politics of the moment do not allow them to support any private development project,” Kimball continued. “Therefore, we have decided to withdraw our application and proceed with as-of-right leasing options.”

Where does Industry City go from here?

So what are “as-of-right leasing options”? Namely, last-mile warehouses and distribution facilities — think Amazon distribution centers — and the low-paying jobs that come with them, as well as additional office space. Asked last week what developers would do at the complex if the rezoning failed, Kimball pointed to both options: “That is not our vision for the Industry City campus, but if we’re left with only what we can do under [the existing zoning], there’s a very real possibility you’ll see a lot more of that,” he told reporters.

During a press briefing on Thursday, Kimball reiterated that approach, but also stressed that Industry City will continue to focus on leasing space to “creative small business.” He flatly rejected the possibility of eventually resubmitting the rezoning application, and called out elected officials for not doing more to support the effort. “For New York City to bounce back and thrive the private sector has to be welcomed, nurtured and allowed to prosper,” he said. “The narrative that private sector is the enemy has got to stop. Because how else are jobs going to be created? How else are budget deficits going to be filled?”

Meanwhile, after the application was withdrawn, community activists were quick to push for a broad public-planning initiative for waterfront neighborhoods across the city. “We need a public-waterfront plan to uplift working people throughout New York, from Sunset Park to Flushing,” said Antoinette Martinez, a lifelong Sunset Park resident and organizer with Protect Sunset Park.

What are the implications for future rezonings?

The fight over Industry City was the biggest clash over development in the five boroughs since the collapse of Amazon HQ2 in Long Island City last year, and the proposal’s defeat reflects the growing strength of progressive activists. Many were quick to dub the failed rezoning “Amazon 2.” But unlike that scheme, which included a whopping $3 billion in public subsidies, Industry City was purely a private endeavor and was more in line with the typical large-scale rezoning projects designed to reshape a corner of a neighborhood. The implications of its defeat are likely far-reaching, and may influence who will shape future development in the city as it recovers from its worst crisis in half a century.

Business and development leaders were quick to express dismay over the defeat. The Real Estate Board of New York blamed political posturing for the project’s failure. “One is left to consider how bad conditions in New York City must get before our political leaders realize that our recovery must be premised on job creation and private investment that will yield the tax revenue to pay for government services,” REBNY President James Whelan said Wednesday. Councilmember Eric Ulrich, a Republican from Queens, put it more bluntly on Twitter, “NYC is going to shit. God save us!”

Less nihilistically, now that the rezoning has been scratched, Menchaca points to the possibility of exploring green-jobs proposals that would promote industry at the site, like in proposals put forward by UPROSE. “People power has triumphed,” Menchaca said. “Our work continues as community voice drives future growth of our neighborhood.”

How The Deal To Remake Industry City Fell Apart