Tuesday, October 13, 2009

After the downzoning: 1638 8th Avenue's Progress

The finished iron work delineates the 8th Avenue front facing facade revealing a significant set back from the curb. A ramp running directly along the right side of the property accesses the underground parking lot.

The view from Prospect Avenue.

What does a Floor Area Ratio of 1.65 look like?
Karl Fisher's R5 vested 1638 8th Avenue rapidly pushes forward after years of slow going excavation/foundation work. Recent photos show the building's current state as it moves in stages towards its future 8th Avenue street address. Believe it or not, this is a 30,986 square foot, 30 unit, two story building. As the lot slopes downwards towards 7th Avenue, the cellar and basement are exposed.
Twenty off street parking spaces will be accessible from a curb cut and driveway ramp that will run along the Windsor Place side of the lot. Expect 27 roof decks of some sort or another.

Metes and Bounds
Full Coverage
Beginning at a point on the N side of 8TH AVENUE
Distant 100 ft. SOUTHWEST of the corner formed by the intersection of 8TH AVENUE and PROSPECT AVE
Running Thence: NE 62 . 77 ft. Thence: NW 347 . 17 ft.
Running Thence: SW 36 ft. Thence: SE 255 . 30 ft.
Running Thence: SE 94 . 10 ft. Thence: 0 ft.
Running Thence: 0 ft. Thence: 0 ft.

A R5 girl living in a R5B World.
The Board of Standards and Appeals Decision from August 2006.

SUBJECT – Application December 19, 2005 – An appeal
seeking a determination that the owner of said premises has
acquired a common law vested rights to continue
development commenced under the prior R5 zoning district.
Current R5B zoning district.
PREMISES AFFECTED – 1638 8th Avenue, lot fronting on
8th Avenue between Prospect Avenue and Windsor Place,
Block 1112, Lots 52, 54, Borough of Brooklyn.
For Applicant: Deirdre Carson.
ACTION OF THE BOARD – Application granted.
Affirmative: Chair Srinivasan, Vice-Chair Babbar, and
Commissioner Collins...........................................................3
WHEREAS, this is an appeal requesting a Board
determination that the owner of the premises has obtained a
vested right under the common law to complete a proposed
development at the referenced premises; and
WHEREAS, this application was brought concurrently
with a companion application brought under BSA Cal. No. 361-
05-BZY (the “BZY Application”), decided the date hereof,
which is a request to the Board for a finding that the owner of
the premises has obtained a right to continue construction
pursuant to ZR § 11-331; and
WHEREAS, the Board notes that while separate
applications were filed according to Board procedure, in the
interest of convenience, it heard the cases together and the
record is the same for both; and
WHEREAS, the Board also notes that the premises was
the subject of an appeal filed on August 20, 2003 under BSA
Cal. No. 263-03-A (the “Appeal”), brought by certain neighbors,
represented by counsel (hereinafter, the “Neighbors”); and
WHEREAS, the substance of the Appeal was a challenge
to a Department of Buildings determination refusing to revoke a
building permit issued under DOB Application No. 301172184
on June 11, 2002 (the “Permit”); and
WHEREAS, the Appeal was dismissed as moot on July
18, 2006, since the applicant worked with DOB to modify its
plans to conform to the relevant issues raised by the appeal; and
WHEREAS, a public hearing was held on this application
on April 25, 2006 after due notice by publication in The City
Record, with continued hearings on June 20, 2006, July 18,
2006, and then to decision on August 22, 2006; and
WHEREAS, the site was inspected by a committee of the
Board, consisting of Chair Srinivasan, Vice-Chair Babbar, and
Commissioner Collins; and
WHEREAS, Community Board 7, Concerned Citizens of
Greenwood Heights, and the South Slope Community Group,
and various elected officials appeared in opposition to the
application; and
WHEREAS, additionally, the Neighbors appeared in
opposition; the arguments made by the Neighbors are discussed
below; and
WHEREAS, the applicant states that the subject premises
fronts on 8th Avenue between Prospect Avenue and Windsor
Place, on a lot having 18,422 sq. ft. of lot area, with frontage of
approximately 63 ft. and a depth of 348 ft.; and
WHEREAS, the subject premises is currently located
within an R5B zoning district, but was formerly located within
an R5 zoning district; and
WHEREAS, under the Permit, the developer of the site
seeks to construct a new two and three-story residential building
with a cellar and basement (the “Building”); and
WHEREAS, the Building complies with the former R5
zoning bulk parameters; specifically, the proposed Floor Area
Ratio was 1.65, which was permitted; and
WHEREAS, however, on November 16, 2005
(hereinafter, the “Enactment Date”), the City Council voted to
adopt the Park Slope South rezoning, which rezoned the site to
R5B, as noted above; and
WHEREAS, because the site is now within an R5B
district, the Building would not comply with the maximum FAR
of 1.35; and
WHEREAS, since the Building violated this provision of
the new R5B zoning district and the foundation was not
completed as of the Enactment Date, the Permit lapsed by
operation of law; and
WHEREAS, additionally, the Department of Buildings
issued a stop work order on November 17, 2005 as to the
Permit; and
WHEREAS, as to the history of work at the site,
demolition activities were authorized under Demolition
Permit No. 301321399 on April 17, 2002 through February
11, 2003; and
WHEREAS, the Permit, which authorized excavation
and construction, was in effect during an initial term of June
11, 2002 through August 13, 2002, and was renewed by DOB
for eight other discrete terms; and
WHEREAS, the applicant states that that construction
proceeded as follows: (1) excavation, dewatering, shoring,
and sheeting began in mid-2003; (2) stop work orders were
issued by DOB, and the owner endeavored to resolve the
underlying issues; (3) the Neighbors filed the Appeal in
August of 2003; (4) during the course of the hearing process
on the Appeal, the owner continued to work with DOB in
order to come up with an acceptable plan revision; (5) in
December of 2004, DOB approved revised plans, and in
February of 2005, DOB renewed the Permit under these
revised plans; (6) revised structural plans were approved on
August 11, 2005; (7) excavation, sheeting, shoring, and
dewatering resumed in September 2005, and pile installation
commenced; and (8) 164 of the 200 required piles were
installed as of the Enactment Date;
WHEREAS, DOB confirmed the issuance of the stop
work orders, and submitted into the record a detailed
description of when the Permit was in effect, and when work
under it was subject to stop-work orders; and
WHEREAS, the applicant claims that much of the
difficulties experienced during construction were caused by
political intervention and overzealous community members;
WHEREAS, however, the Board notes that there is no
evidence of malfeasance on the part of any of the opposition,
and that neighbors to a construction site are entitled to ask
DOB to investigate construction and plan- related concerns;
WHEREAS, further, the applicant conceded that many
of the problems experienced during development related to a
contractor that the owner ultimately dismissed from the
project; and
WHEREAS, the applicant also conceded that the plans
under which the Permit was initially obtained reflected
zoning non-compliances and were subsequently revised; and
WHEREAS, that being said, the Board agrees with the
applicant that neither the initial contractor-related problems
nor the plan-related problems that arose during this
development project are fundamental impediments to a
finding of vested rights under the common law; and
WHEREAS, the Board notes that development
difficulties that require construction and plan modifications
are not rare occurrences in projects of this size within the
City, and that DOB enforcement action occurs fairly
frequently because of them; and
WHEREAS, in sum, no development project proceeds
perfectly, given the human element involved, and a common
law vesting determination is not foreclosed simply because
problems arise; and
WHEREAS, the Board also agrees with the applicant
that the owner here endeavored to resolve the plan issues with
DOB while the Appeal was pending, and also obtained a new
contractor; and
WHEREAS, the Board further observes that
construction on this site was contemplated and initiated more
than four years prior to the rezoning; this is not the case of a
developer initiating development days prior to a zoning
change in an effort to beat the clock (even though it is
apparent that work proceeded up to the date of the rezoning
after the plan revisions were accepted by DOB); and
WHEREAS, however, while an application for a
common law vesting determination may still be made under
these circumstances, the Board finds that some
acknowledgement of the problems with the initial
construction and with the initial plans must be reflected in its
analysis; and
WHEREAS, this is particularly true since the applicant
concedes that some construction work had to be redone, that
some was remedial work performed to address violations, and
that many of the soft costs relate to the plan revisions; and
WHEREAS, thus, as discussed in more detail below,
the applicant has separated the relevant work performed and
expenditure incurred prior to the acceptance of the plan
revision by DOB in December of 2004 versus thereafter, and
made other appropriate deductions; and
WHEREAS, this ensures that the Board is not
according any special exceptions in its analysis because the
owner experienced construction difficulties; and
WHEREAS, additionally, the Board has made further
refinements above and beyond those made by the applicant;
WHEREAS, the Board also notes that in its evaluation
of this application, no work or expenditure relating to
construction performed contrary to stop-work orders, or that
was otherwise unauthorized, has been credited; and
WHEREAS, in any event, the Board notes that no
violations for after-hours or weekend work were issued by
DOB after December of 2004; and
WHEREAS, in fact, by carving out consideration of
relevant work and expenditure prior to the approval of the
plan revisions in December of 2004, the applicant has carved
out any illegal work and expenditures; and
WHEREAS, notwithstanding the separation of work and
expenditures, the applicant requests that the Board find that
based upon the amount of work performed, and the amount of
financial expenditures, including irrevocable commitments, as
well as the serious economic loss the owner would face if
compelled to comply with the new zoning, the owner has a
vested right to continue construction and finish construction of
the Building; and
WHEREAS, the Board notes that established precedent
exists for the proposition that seeking relief pursuant to ZR § 11-
30 et seq. does not prevent a property owner from also seeking
relief under the common law; and
WHEREAS, as a threshold matter in determining this
appeal, the Board must find that the completed work was
conducted pursuant to a valid permit; and
WHEREAS, as discussed above, DOB and the owner
resolved all outstanding issues related to the Permit as of
December 2004; the resolution of these issues led to the
dismissal of the Appeal; and
WHEREAS, while on two occasions DOB issued a notice
of intent to revoke the Permit, at no point was the Permit
actually revoked and then reinstated; and
WHEREAS, further, on both occasions, the owner
successfully engaged DOB to resolve the underlying problems;
WHEREAS, accordingly, the Board confirms DOB’s
acceptance of the validity of the Permit for purposes of vesting;
WHEREAS, assuming that a valid permit has been issued
and that work proceeded under it, the Board notes that a
common law vested right to continue construction generally
exists where the owner has undertaken substantial construction
and made substantial expenditures prior to the effective date of a
zoning change, and where serious loss will result if the owner is
denied the right to proceed under the prior zoning, and; and
WHEREAS, specifically, as held in Putnam Armonk,
Inc. v. Town of Southeast, 52 A.D.2d 10 (2d Dept. 1976),
where a restrictive amendment to a zoning ordinance is
enacted, the owner’s rights under the prior ordinance are
deemed vested “and will not be disturbed where enforcement
[of new zoning requirements] would cause ‘serious loss’ to
the owner,” and “where substantial construction had been
undertaken and substantial expenditures made prior to the
effective date of the ordinance.”; and
WHEREAS, however, as discussed by the court in Kadin
v. Bennett, 163 A.D.2d 308 (2d Dept. 1990) “there is no fixed
formula which measures the content of all the circumstances
whereby a party is said to possess 'a vested right’. Rather, it is
a term which sums up a determination that the facts of the
case render it inequitable that the State impede the individual
from taking certain action”; and
WHEREAS, as to substantial construction, the applicant
states that after the issuance of the revised permit in
December of 2004 and the re-commencement of work on the
site in August of 2005, the applicant completed the
installation of 164 out of 200 required piles; and
WHEREAS, the applicant also states that significant
dewatering, sheeting, and shoring efforts were undertaken;
WHEREAS, in support of this statement, the applicant
has submitted pictures, invoices for labor and material, and
affidavits from construction personnel; and
WHEREAS, the Board notes that dewatering, shoring, and
sheeting activities were excluded from its assessment of the
“substantial progress made on foundations” standard as set forth
in ZR § 11-331, since they may not be reflected in the actual
permanent foundation construction (with the exception of water
retention tanks, which in any case have not been installed on the
site yet); and
WHEREAS, however, such activities do fall under the
rubric of “construction”, and thus may be properly analyzed by
the Board in the context of the instant application; and
WHEREAS, the Board has reviewed the representations
as to the amount and type of work completed and the
documentation submitted in support of the representations, and
agrees that it establishes that substantial work was performed,
said work consisting of piles installation, dewatering, shoring
and sheeting; and
WHEREAS, the Board’s conclusion is based upon a
comparison of the type and amount of work completed in the
instant case with the type and amount of work discussed by New
York State courts; and
WHEREAS, specifically, the Board has reviewed the
cases cited in the applicant’s December 19, 2005 submission, as
well as other cases of which it is aware through its review of
numerous vested rights applications, and agrees that the degree
of work completed by the owner in the instant case is
comparable to, or in excess of, the degree of work cited by the
courts in favor of a positive vesting determination; and
WHEREAS, the Neighbors contend that substantial
construction has not been performed, and offer two primary
arguments in support of this contention: (1) that the amount of
work completed is not substantial; and (2) that the Board must
apply the statutory standard of “substantial progress on
foundations” notwithstanding its distinction from the common
law standard of “substantial construction”; and
WHEREAS, as to the first argument, as noted above, the
Board has compared the degree of construction work completed
here to that discussed in relevant cases; and
WHEREAS, the Board observes that the courts of New
York have found vesting in instances where only minimal work
has been completed, as long as such work was permitted and
expenditures had been made; and
WHEREAS, in particular, the Board cites to Ortenberg v.
Bales, 229 N.Y.S. 550 (1928), where the developer had
performed substantial excavation and entered into contracts,
but had not performed any foundation work; Pelham View v.
Switzer, 224 N.Y.S. 56 (1927), where only excavation was
completed, and Hasco Electric Corp. v. Dassler, 144 N.Y.S.
857 (1955) where site clearance and excavation was
complete, but no foundation construction had been
commenced; and
WHEREAS, in all of these cases, the court found that
the owner’s rights had vested; and
WHEREAS, while there are other cases where much
more work was performed, none of them establish a bright
line rule as to how much construction must be completed
before a finding of “substantial construction” may be made;
WHEREAS, further, the Board notes that the other
components of the doctrine – a valid permit, economic loss
and substantial expenditure – must be taken into
consideration: it is not appropriate for the Board to ignore
these factors and focus only on a comparison of completed
construction work versus what remains, as would be the case
under a statutory application; and
WHEREAS, instead, the appropriate comparison is
between the amount of construction work here and that cited
by other courts; and
WHEREAS, in light of such comparison, the Board can
only conclude that installation of piles, dewatering, sheeting,
and shoring is substantial; and
WHEREAS, in support of the second argument - that
the Board must apply the statutory “substantial progress on
foundations” standard in a common law vesting application -
the Neighbors cite to Ellington Construction Corp. v. Zoning
Board of Appeals, 27 NY 2d 114 (1990); and
WHEREAS, the Neighbors read Ellington to stand for
the proposition that where the legislature has enacted a
statutory vesting scheme, a zoning board must pay heed to
the legislative intent as the “controlling principal”; and
WHEREAS, the Neighbors conclude that the Board
must apply the “substantial progress on foundations” standard
set forth in ZR § 11-331; and
WHEREAS, however, as explained by the applicant,
Ellington does not stand for this proposition at all; and
WHEREAS, in fact, the Ellington court explained that
the common law vesting rules should inform the application
of the subject exemption period statute; this is the opposite of
what the Neighbors argue; and
WHEREAS, the Board agrees that Ellington does not
require the Board to apply the statutory standard in its review
of this case; and
WHEREAS, this conclusion is borne out by the Board’s
review of the Kadin opinion, cited above; and
WHEREAS, the Kadin court deals specifically with ZR
§ 11-30 et seq., and explicitly held that a common law
remedy exists separate and apart from the statute; and
WHEREAS, the court stated: “New York City Zoning
Resolution § 11-331 does not codify or abolish the common-
law doctrine of vested rights. The common-law doctrine is a
broader consideration than that posited in that section of the
resolution, which confines itself to whether or not certain
physical stages of construction relating to excavation and the
foundation have been completed. While the general standard
in determining vested rights is substantial construction and
substantial expenditure made prior to the effective date of the
zoning amendment . . . unlike New York City Zoning
Resolution § 11-331, ‘[t]here is no fixed formula which
measures the content of all the circumstances whereby a party
is said to possess 'a vested right’”; and
WHEREAS, the Board has neither the desire nor the
authority to ignore such clear precedent; and
WHEREAS, the Board observes that if Ellington were
applied as suggested by the Neighbors, the precedent of
Kadin would be eviscerated, and a common law application
would be a pointless and purposeless administrative exercise
when, as occurred here, a statutory application had been
made as well; and
WHEREAS, in sum, the Board rejects both of the
Neighbor’s arguments as to the substantial construction
finding; and
WHEREAS, as to expenditure, the Board notes that unlike
an application for relief under ZR § 11-30 et seq., soft costs and
irrevocable financial commitments can be considered in an
application under the common law; accordingly, these costs are
appropriately included in the applicant’s analysis; and
WHEREAS, in its July 25, 2006 submission, the applicant
states that the total expenditure was $4.77 million out of a
budgeted $13.5 million; and
WHEREAS, the applicant notes that this calculation does
not include duplicative costs, but includes costs related to
demolition, site preparation, as well as costs related to
construction performed after DOB approved the plan revisions
in December 2004; and
WHEREAS, this submission also provides a detailed
explanation of various other soft cost deductions made to avoid
counting duplicative costs and costs related to the Appeal; and
WHEREAS, the Board generally finds that the deductions
made by the applicant are appropriate and satisfy the concerns of
the Board that no credit be given to the expenditures made to
rectify the prior construction or plans; and
WHEREAS, however, the Board notes that the $4.77
million total includes the purchase price of the site; and
WHEREAS, the applicant states that the purchase price
may properly be included in an analysis of expenditure, since it
was purchased long before the proposed rezoning; and
WHEREAS, the Board agrees that there is no impediment
to consideration of purchase price, but also notes that it is not
required; and
WHEREAS, the Board has not analyzed purchase price in
its past consideration of vested rights cases, and declines to do
so here; and
WHEREAS, while it is reasonable to conclude that a
purchase price is based upon the zoning in effect at the time of
the purchase, the Board notes that this is not always the case,
and further observes that not all transactions are recent or arm’s-
length; and
WHEREAS, thus, the Board finds that the relevance of
purchase price may be difficult to ascertain in many
circumstances; and
WHEREAS, the Board concludes that it better to assess
expenditure in light of total development costs absent purchase
price; and
WHEREAS, here, the stated acquisition price is $1.69
million; subtracting this amount from both the expenditure total
and the development costs means that the owner expended
approximately $3.08 million out of $11.81 million; and
WHEREAS, the Board also notes that the amount of
expenditure claimed includes costs related to obtaining the
various mortgages on the property and the interest payments on
them, which totals $2.09 million; and
WHEREAS, the Neighbors argue that such costs should
not be included, and cite to McBride v. Town of Forestburgh, 54
Ad 2d 346 (1976) for the proposition that expenses incurred
prior to the commencement of the actual construction do not
create a vested right; and
WHEREAS, the applicant responds that this an improper
reading of McBride, and argues instead that this case only stands
for the proposition that such costs alone cannot sustain a vested
rights determination; and
WHEREAS, the Board agrees with the applicant, since it
has previously considered pre-construction soft costs in its
deliberation, the basis being the numerous court opinions
holding that such soft costs can be folded into the analysis (see
e.g. Wheatland v. Esso Standard Oil Co., 150 N.Y.S.2d 130
(1956) and Reichenbach v. Windward at Southhampton, 364
N.Y.S.2d 283 (1975)); and
WHEREAS, nonetheless, the Board is troubled by the
inclusion of the full amount of these mortgage costs in the
calculation, particularly the interest payment, since the
cumulative amount of said payments has increased due to the
lengthy construction process, which the applicant concedes is
due in part to construction and plan-related problems; and
WHEREAS, accordingly, like acquisition cost, the Board
finds it prudent to deduct these costs from both the stated
expenditures and the overall development budget; and
WHEREAS, after making the relevant subtractions of this
$2.09 million cost, the Board concludes that the applicant
expended approximately $990,000 out of a total cost (minus
acquisition and mortgage costs) of $9.72 million (or
approximately 10 percent); and
WHEREAS, the Board considers a million dollar
expenditure substantial in and of itself, and not minimal when
compared to the total development costs; and
WHEREAS, the Board’s consideration is again guided by
cases considering how much expenditure is needed to vest rights
under the prior zoning, as well as the expenditure percentages;
WHEREAS, as to the serious loss that the owner would
incur if required to construct the building under the current
zoning, the applicant states that the loss of floor area that
would result if vesting was not permitted (from an FAR of
1.65 to 1.35) would lead to the elimination of approximately 5,527 sq. ft. of floor area; and
WHEREAS, the applicant states that this would lead to
financial loss because: (1) further architectural and
engineering costs would be required to reconfigure and
redesign the building to account for this loss; and (2)
approximately 18 percent of sellable floor area would be lost;
WHEREAS, the Board notes that a serious loss
determination may be based in part upon a showing that certain
of the expenditures could not be recouped if the development
proceeded under the new zoning; and
WHEREAS, here, the Board agrees that the building
would have to be redesigned at significant cost, and that the
prior architectural and engineering costs related to the plans
accepted by DOB in December of 2004 could not be recouped;
WHEREAS, additionally, serious loss can be substantiated
by a determination that there would be diminution in income if
the FAR requirement of the new zoning were imposed; and
WHEREAS, here, the Board agrees that a significant
reduction in sellable floor area in a development of this size
will result in a serious loss; and
WHEREAS, the Board notes that its conclusion that
serious loss would occur is in consideration of the carve-out
of costs related to the need to revise the plans and redo some
of the construction work; and
WHEREAS, in sum, the Board has reviewed the
representations as to the work performed, the expenditures
made, and serious loss, and the supporting documentation for
such representations, and agrees that that the applicant has
satisfactorily established that a vested right to complete
construction of the Building had accrued to the owner of the
premises as of the Enactment Date; and
WHEREAS, the Neighbors and other opposition
expressed additional concerns about various aspects of this
application; and
WHEREAS, specifically, specific neighbors of the site
allege that the construction on the site has caused damage to
their properties, and that contrary to the assertions of the
applicant, the owner has not resolved this dispute or
otherwise worked towards such resolution; and
WHEREAS, while the applicant disputes these claims,
the Board finds that this particular dispute is best resolved in
another forum; and
WHEREAS, further, the Board again notes that given
the built conditions within the City, it is not uncommon for
allegations of damage to adjacent property to be made, and
that such allegations, even if substantiated, would not prevent
a finding of common law vested rights; and
WHEREAS, while the Board was not swayed by many
of the opposition arguments, it nevertheless understands that
the community and the elected officials worked diligently on
the Park Slope South rezoning and that the Building does not
comply with the new R5B zoning parameters; and
WHEREAS, the Board further understands that
neighbors of the site are unhappy with the developer; and
WHEREAS, however, the applicant has met the test for
a common law vested rights determination, and the Board has
determined that the equities in this case, given the established
serious loss, and the degree of work performed and
expenditures made, weigh in the favor of the owner,
particularly since all visible bulk parameters of the proposed
building (i.e. height, yards, and setbacks) would be identical
under either the R5 or the R5B zoning requirements;
WHEREAS, accordingly, based upon its consideration
of the arguments made by the applicant and the Neighbors
and other opposition, as outlined above, as well as its
consideration of the entire record, the Board finds that the
owner has met the standard for vested rights under the
common law and is entitled to the requested reinstatement of
the Permit, and all other related permits necessary to
complete construction.
Therefore it is Resolved that this appeal made pursuant to
the common law of vested rights requesting a reinstatement of
DOB Permit No. 301172184, as well as all related permits for
various work types, either already issued or necessary to
complete construction and obtain a certificate of occupancy, is
granted for
four years from the date of this grant.
Adopted by the Board of Standards and Appeals,
August 22, 2006.


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