Real Estate Forum Podcast EP06 Melissa Roman Burch and the NYC Economic Development Corporation

Key Concepts

New York City Economic Development Corporation (EDC): A self-sustaining not-for-profit organization that manages the city's real estate portfolio to achieve both financial returns and social impact. It also uses its assets as a "policy laboratory" to test and scale citywide initiatives.
Civic Developer: A term used by Melissa Roman Burch to describe her approach to real estate development, focusing on large-scale, public-private projects that shape entire neighborhoods.
Urban Doom Loop: A theoretical cycle of urban decline characterized by office vacancy, fiscal stress, and population loss.
New New York Panel: A panel convened in 2022 by Mayor Adams and Governor Hochul to develop strategies for New York City's economic recovery and global competitiveness in a post-COVID, remote-work era.
City of Yes for Housing Opportunity: A comprehensive zoning reform passed in December 2024, representing the first citywide update to zoning codes since 1961, aimed at enabling more housing development across the city.
Office to Residential Conversion: A strategy to transform underutilized office buildings into residential units, a key component of New York's housing strategy.
Tax Incentives (485-x, 467-m): Financial incentives designed to encourage development and conversion projects, including 485-x (replacing 421-a) and 467-m for office-to-residential conversions.
Neighborhood Rezonings: Specific zoning changes in key neighborhoods to facilitate increased housing development.
Executive Order 43: An executive order focused on utilizing public land for housing production.
Public-Private Partnership (PPP): Collaboration between government entities and private companies to undertake development projects.
Adaptive Reuse: The process of repurposing existing buildings for new uses, often preserving historical character while meeting modern needs.
Offshore Wind Port: A facility designed to support the development and operation of offshore wind energy projects.
Green Economy: An economic sector focused on sustainable practices and renewable energy.
Mindset (Growth vs. Fixed): A psychological concept, popularized by Carol Dweck, distinguishing between a belief in fixed abilities and a belief in the capacity for growth through effort and learning.

Melissa Roman Burch's Background and Transition to EDC

Melissa Roman Burch, Chief Operating Officer of the New York City Economic Development Corporation (EDC), transitioned to the public sector in 2022 after two decades in private sector real estate development. Originally from Ohio, she was drawn to New York City and initially pursued investment banking. Her career path evolved as she sought to blend her interests in government, public policy, deal-making, and capital formation, leading her to define herself as a "civic developer." This involved working on large-scale public-private real estate developments that shaped city neighborhoods. The turning point to join the EDC was an invitation from CEO Andrew Kimball, who sought her expertise to contribute to New York City's post-COVID economic recovery. She saw it as an opportunity to apply her private sector experience in public-private partnerships to "jumpstart" the city and activate its real estate.

New York City's Economic Recovery and Rejection of the "Urban Doom Loop" Narrative

Melissa Roman Burch argues that the "urban doom loop" narrative, which posits a cycle of decline due to office vacancy and fiscal stress, is overstated for New York City. She attributes this confidence to proactive measures taken following the COVID-19 pandemic. The "New New York Panel," a collaboration of civic leaders, business, academia, and government, developed a 40-point plan to address the question of why people should work in New York if they can work from anywhere. This plan led to significant regulatory and legislative changes, including tax abatements for office-to-residential conversions, zoning reforms, and the creation of a public realm czar.

Evidence of Recovery:

Job Growth: New York City has regained all one million jobs lost during COVID-19 and now has 153,000 more private sector jobs than ever before.
Population Growth: After a dip in 2022, the city has seen an influx of 87,000 people in the last year, double the number of the second-place city, Houston.
Office Occupancy: 76% of workers are either fully in-person or hybrid.
Office Leasing Recovery: New York leads the nation in office leasing recovery, with 6 million square feet of net absorption in the last year, three times that of Dallas.
Tax Base: The city's tax base has not eroded; in fact, personal income and property tax receipts have grown. New York's diversified tax base provides resilience against single-point failures.

While acknowledging a national slowdown in job growth, Burch asserts that New York City's economic momentum remains strong and it has never been at risk of an urban doom loop.

Private Investment and Talent Attraction

Melissa Roman Burch highlights significant private investment signals in New York City, with companies like Bridgewater Capital, Deloitte, Chobani, Disney, and OpenAI establishing or expanding their presence. This influx is largely driven by the city's highly educated and engaged talent pool. Over the past few years, 500,000 young college graduates have moved to New York, joining the existing 500,000 college students. Companies are drawn to this concentration of talent, creating a "virtuous cycle" where businesses are attracted by the talent, and talent is drawn by social, cultural networks, and perceived opportunities.

The Five Boroughs as Individual Cities and Economic Resilience

Burch emphasizes that each of New York City's five boroughs should be viewed as the size of a major American city, a perspective fundamental to the EDC's mission. This viewpoint shapes the understanding of recovery and economic resilience.

Brooklyn: Comparable in population to Chicago, presenting a significant opportunity for development, particularly along its coastline.
Staten Island: Matches the population of Miami. The EDC is investing $400 million in the North Shore Esplanade to connect communities to the ferry system, improve mobility, and stimulate housing production.
Queens: The size of Houston.
The Bronx: The size of Dallas.

This perspective underscores the deep and diverse wells of opportunity across the city, each with unique housing needs, communities, and businesses that the EDC aims to understand and connect with investors.

Addressing the Housing Crisis: Five Major Initiatives

New York City is facing its most severe housing crisis in decades, with affordability stretched thin. The mayor's goal is to create 500,000 new housing units over the next 10 years. The EDC and its partners are employing five key initiatives to achieve this:

City of Yes for Housing Opportunity Reform: Passed in December 2024, this is the first citywide zoning code update since 1961. It allows for more housing everywhere, including in neighborhoods previously restricted. Key changes include reducing outdated parking requirements and significantly expanding the eligibility for office-to-residential conversions by updating conversion dates from 1961/1977 to 1990, opening up an additional 136 million square feet of potential conversion space.
Tax Incentives:
- 485-x: The replacement program for the expired 421-a tax incentive.
- 467-m: A new tax abatement specifically for office-to-residential conversions, which has been a key differentiator for projects. Over 15,000 conversion units are currently underway.
Neighborhood Rezonings: Five specific neighborhood rezonings are underway (Bronx Metro North, Midtown South, Atlantic Avenue in Brooklyn, Jamaica in Queens, and Long Island City in Queens). These are expected to create approximately 50,000 additional housing units within the "as-a-right" zoning framework, enabling private investment in areas where development was previously restricted. These plans are anticipated to be fully passed by the end of the year.
Executive Order 43 (Public Land for Housing): This initiative, announced 18 months ago, directs city agencies to review their land holdings for housing production. The EDC is leading efforts to bring these opportunities to market through RFPs for sites like Gansevoort Square, 100 Gold, Flushing Airport, and Coney Island.
Charter Commission Ballot Questions: Housing-related ballot questions will appear in November, aiming to fast-track and accelerate public review for affordable housing projects. Voters are encouraged to vote "yes" on these measures.

Catalytic Public-Private Partnerships: Willets Point and Flushing Airport

Willets Point Redevelopment (Queens)

Willets Point is presented as a prime example of public-private partnership excellence. The project involves redeveloping 60 acres of land that required extensive assembly and remediation due to environmental degradation. The EDC led efforts in land assemblage, environmental remediation, and infrastructure development (sewers, water mains, streets). The new vision, spearheaded by Mayor Adams and the EDC, includes:

2,500 Units of 100% Affordable Housing: This is double the housing envisioned in previous plans and is supported by tax-exempt bonds and subsidies to ensure affordability across various Area Median Income (AMI) levels.
New York City's First Purpose-Built Professional Soccer Stadium: This 100% privately financed stadium will be home to New York City Football Club and is expected to generate significant economic benefits, including 14,000 construction jobs and 550 permanent jobs. It will also serve as a venue for community events.

The project is already under construction, with housing expected to be ready by spring 2026 and the stadium for the 2027 MLS season.

Flushing Airport Redevelopment (Queens)

The former Flushing Airport, a 66-acre underutilized parcel, is being transformed under Executive Order 43. After 40 years of vacancy, the site has reverted to a natural state and presents challenges like wetlands and the need for environmental and community review.

Developers: Cirrus Workforce Housing and LCOR have been designated as developers.
Vision: Envisions approximately 3,000 workforce housing units.
Wetland Restoration: The plan includes restoring and opening up wetlands for community access.
Timeline: Construction is expected to begin by 2028, following entitlement and review processes.

This project exemplifies how challenging public sites can be activated through public-private partnerships.

Reimagining Public Assets: Brooklyn Army Terminal and Waterfront Growth

Brooklyn Army Terminal (Brooklyn)

The Brooklyn Army Terminal, a 4 million square foot campus, is a key asset in the EDC's portfolio, undergoing adaptive reuse for advanced manufacturing. Originally a military supply base from 1919, it played a crucial role in World War II.

Adaptive Reuse Focus: The building's robust structure (high pounds per square foot, concrete floors, loading docks) is ideal for modern manufacturing.
Current Status: It houses approximately 100 businesses and employs around 4,000 people.
Future Investment: An additional $100 million is planned for repairs, upgrades (elevators, windows), and energy efficiency measures.
Economic Engine: It serves as an engine for economic opportunity in Sunset Park and the South Brooklyn waterfront.

Harbor and Waterways as Growth Engines

New York City's 520 miles of coastline are being reimagined as engines of growth, building on its history as a harbor town.

South Brooklyn Marine Terminal: In partnership with Equinor, the EDC is developing the largest offshore wind port in the United States on a 70-acre site.
- Investment: $100 million from the city, matched by $1 billion from Equinor.
- Impact: Equinor will install 54 turbines powering 500,000 Brooklyn homes, creating jobs, and fostering a new industry.
- Innovation and Workforce: The project includes innovation accelerator programs and workforce training in fields like welding and electrical engineering, contributing to the green economy.
Brooklyn Marine Terminal Redevelopment (Red Hook): A proposed $3.5 billion redevelopment of a 122-acre site acquired from the Port Authority.
- Vision Plan: Approved by a community task force, it allocates 60 acres for a modern, all-electric maritime port and 60 acres for housing.
- Housing: Potential for 6,000 new homes, with 40% permanently affordable.
- Modern Maritime Port: Electrification allows for quieter, cleaner operations, enabling co-location with housing.
- Integrated Neighborhood: The plan includes new parks, open space, commercial spaces, and community amenities.

Catalyzing Innovation Sectors

The EDC actively supports growth in innovation sectors beyond real estate and infrastructure, including life sciences, the green economy, AI, and advanced manufacturing.

Sector Prioritization: The EDC focuses on sectors that are high-growth and high-wage, leveraging New York's economic diversification.
Ecosystem Building Tools:
- Cornell Tech (Roosevelt Island): The EDC supported the development of this science and engineering campus, which has spawned numerous tech companies that remain in New York City.
- Piloting Programs: The EDC offers piloting programs at sites like the Brooklyn Army Terminal, allowing entrepreneurs to test new technologies in large-scale environments.
- BATWorks (Brooklyn Army Terminal): A 200,000 square foot climate innovation hub, a $100 million city investment in partnership with LACI (Los Angeles Clean Tech Incubator) and CIC (Cambridge Innovation Center). It will house over 150 startups over 10 years, generate 600 jobs, and create $2.6 billion in economic impact.
- Harbor Climate Collaborative: A collaboration between the EDC, the Climate Exchange on Governor's Island, and climate-related businesses like New Lab in the Brooklyn Navy Yard. This initiative aims to position New York City as a global center for climate innovation, leveraging former military bases connected by the NYC Ferry system.

Personal Recommendation: "Mindset" by Carol Dweck

Melissa Roman Burch's personal recommendation is Carol Dweck's book "Mindset: The New Psychology of Success." She describes it as a book that applies to business and life, emphasizing lifelong learning and reframing challenges as opportunities for growth. The core concept is the distinction between a "growth mindset" (believing abilities can be developed through effort) and a "fixed mindset" (believing abilities are innate). Burch finds this perspective motivating, viewing every situation as a learning opportunity and seeing others' successes as chances to learn rather than compare.

Conclusion

Melissa Roman Burch's insights highlight New York City's robust economic recovery and its strategic approach to future growth. The EDC, under her leadership, is actively leveraging public-private partnerships, innovative zoning reforms, and strategic investments to address critical challenges like housing affordability and to foster growth in key innovation sectors. The emphasis on the five boroughs as distinct economic centers, the revitalization of waterfronts, and the commitment to a green economy underscore a comprehensive vision for a globally competitive, equitable, and thriving New York City.