DeNiro hotel obtains variance

Contaminated soil remediation caused hardship. 377 Greenwich LLC, with principals Robert DeNiro, Ira Druckier and Richard Born, sought BSA approval for a 59,419- square-foot, seven-story luxury hotel in Tribeca that would exceed floor area, wall height and setback restrictions. DeNiro’s development team had started the permit process in 2003 by first seeking the Landmarks Preservation Commission’s approval for construction of a six-story building within the Tribeca West Historic District. After receiving approval, the six-story project was abandoned for a larger eight-story scenario. In November, 2004, Landmarks approved a seven-story hotel design that required a variance grant. 1 CityLand 46 (Dec. 2004).

In its application to BSA, the developer claimed that $1.7 million had been spent to remove two underground tanks from the site and to remediate the soil in preparation for development. Poor soil conditions compounded by the site’s high water table and the area’s floodplain escalated the project’s construction costs, making a smaller code-compliant development infeasible. The developer submitted feasibility studies, showing that an as-of-right hotel, office building and rental residential units, limited to the 50,355-square-foot area permitted by code, were infeasible.

At the hearing, BSA questioned why the developer had not studied a code-compliant condominium scenario, noting that condo units could yield a higher return. The developer explained that it planned to use Liberty Bonds to finance the project. The bonds restricted the transfer of the underlying property for 30-years, eliminating the possibility of a transfer to a condominium. In response to BSA’s questions as to whether the Liberty Bonds were necessary, the developer submitted analyses, showing a $1.8 million cost savings during construction and an $800,000 annual savings with the use of the bonds.

BSA denied that the site was unique due to its location since the floodplain affected all lots surrounding the site, but found hardship existed due to the high remediation costs and poor soil conditions. Voting on August 16, 2005, BSA granted the variance, finding that there was no possibility of developing an as-of-right project.

BSA: 377 Greenwich Street (101-05-BZ) (August 16, 2005) (Irving J. Gotbaum, for 377 Greenwich; The Rockwell Group). CITYADMIN

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