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Re: W Hotel
I think that is another development, the lot across the street.
I think that is another development, the lot across the street.
Early renderings had some times square style billboards in them:http://img159.imageshack.us/img159/5962/wilbursquarenightshotb2qt7.jpg
I understand that the design was changed, but is there still plans for those billboard/LED signs? I was kind of looking forward to them.
I contacted the BRA last week about this project - Parcel P7-a. I was told that it has been approved and the developers still want it built, but like everything else is awaiting financial backing.
I contacted the BRA last week about this project - Parcel P7-a. I was told that it has been approved and the developers still want it built, but like everything else is awaiting financial backing.
Won't neighbors cry foul over how bright the LED signs will be? I think it looks good and will be a nice addition to the area.
Mayor Thomas Menino has tentatively selected three construction projects for the first $15.7 million of $40 million in federal HUD (US Department of Housing and Urban Development) gap-loan funds available to Boston for economic development. To be eligible for this loan, the rest of the financing or equity must be in place, the project must create at least one full-time job for every $35,000 loaned with at least half the jobs going to moderate- or low-income people, and it must be at least 20,000 square feet in size.
Let?s look at the way Menino is using the program.
A 4,000-square-foot upscale grocery store in a luxury South Boston condo building will get $700,000, and a 1960s-style boxes-in-a-sea-of-parking shopping mall-definitely not "Greentown" in Beantown-located in the mayor?s neighborhood of Hyde Park is in line to get $5 million to start construction. But the big-ticket item is the Sawyer Enterprises 235-room W Hotel in Boston?s Theater District, slated to get a $10 million loan to complete construction. This project already received a huge city subsidy and a custom re-zoning by the BRA that doubled its height to 300 feet, upping its value.
The W Hotel is already built, but insists that its four-star "brand standard" requires a restaurant-even in this restaurant-rich downtown location-for which the operator can?t get financing. So the HUD loan is just for the interior fit-out of the restaurant-plus a spa and a "destination theme lounge" (the bar).
The developer says the hotel will create 300 jobs, meeting the HUD formula. But the construction supported by the loan, the 6,000-square-foot restaurant, will create only 75 jobs, according to the application. (The spa and bar total only 10,000 square feet and create only 58 more jobs.) However, HUD accepts the developer?s math counting the whole hotel as "the project," so it technically qualifies.
But what is Menino accomplishing with this choice?
Of the 300 hotel jobs, 270 will be low-wage service jobs for low-income people. As often happens, the unintended consequence of HUD?s requirement will be to support profitable upscale commercial developments while perpetuating an economic underclass of the "working poor." Bellhop and chambermaid and waiter are honest days? work, but seldom at a livable day?s pay. And it?s not necessarily likely that these jobs would go to Boston residents. Of the 275 construction jobs for this project, only 25 to 38 percent went to residents, despite the 50 percent goal. Would residents fare better with these permanent jobs? Could many of these service, low-wage employees really afford Boston?s cost of living, when even white-collar workers flee to more affordable destinations? With the high poverty and unemployment rates in some of our neighborhoods, I think Menino should focus public community development resources in a more bottom-up growth strategy.
What would happen if the money went elsewhere? Well, Boston?s hotel occupancies and rates have been crushed by the economic downturn. If the W, which has been in the making for ten years, is delayed until the restaurant operator can get a private loan, will the city?s hotel needs go unmet? In fact, won?t the addition of 235 more hotel rooms now simply draw business away from existing hotels, and reduce their viability? Some might even be driven out of business; is it the government?s role to tilt the competitive playing field and choose which will survive?
Indeed, the W Hotel and Residences chain itself is having foreclosure problems already, having entered foreclosure in Arizona this April. Mayoral candidate Kevin McCrea (whose candidacy I support) blogs about asking the mayor why this loan was being made when there was so much need among poor people hit by the recession; Menino reportedly answered, "because one of the investors pulled out of the W hotel project and [it] was in danger of foreclosure." Saving this mega-corporation from its investment mistakes at public risk on the pretext of trickling down a few unlivable jobs is not really community development. It is simply corporate welfare.
A HUD loan is an important opportunity for community uplift. Public resources should support projects that would generate not just jobs but actual livelihoods-and businesses that would serve, as well as hire, low-income people. The narrow goal of "creating jobs for low-income people," however benevolently meant, is misdirecting public resources to short-term payoffs that further increase the wealth gap. In fulfilling our valid-but incomplete-poverty-targeting criterion, these projects will produce mostly low-wage, dead-end jobs for poor people, serving relatively well-off people. We pay for this disparity in crime, shattered families, and unsustainable consumer debt, the root of the current economic collapse.
Menino has set aside only 10 percent of the HUD loan pool for as-yet unspecified smaller neighborhood-based projects. I think we should put all of our HUD assistance into small local businesses that hire and serve residents in disadvantaged communities, which are always hit hardest in downturns. That would create the most jobs, employ the most local residents, and cut crime by bringing stable employment to neighborhoods whose residents have virtually no job prospects in the current economic environment. This would truly be community development, the underlying purpose of HUD, and the legitimate role of government.
Credit is now our most precious resource. Before the designation process goes any further, the City Council should hold hearings, preferably out in the neighborhoods, to discuss where this money should go. The first Council hearing was a 25-minute introduction to the loan program on February 2 at City Hall by the Department of Neighborhood Development, which administers it. That hearing was attended by only two Councilors, Bill Linehan and Mike Ross, who asked that the Council be updated as specific decisions were made. This is the time. I have asked the three mayoral challengers, Councilors Michael Flaherty and Sam Yoon and McCrea, to respond to this column, and their responses will run next week.
I think we can get more bang for our bucks, and more economic justice, which would be a good investment for all of us.
Shirley Kressel is a landscape architect and urban designer, and one of the founders of the Alliance of Boston Neighborhoods.
The four mayoral candidates, Mayor Thomas Menino, South End developer Kevin McCrea, and At-Large City Councilors Michael Flaherty and Sam Yoon, sent in their responses to last week?s Shirley Kressel column "What to do with the HUD $?" Below are their answers in their entirety.
Michael Flaherty:
Since the Boston Invests loan program was first announced last December, I have been concerned about how these critical federal funds will be administered in our neighborhoods and have also questioned the city?s ability to hold developers accountable for delivering the community benefits tied to these loans, such as jobs for low- and moderate-income workers. My doubt stems partly from reports last March that the BRA (Boston Redevelopment Authority) was considering absolving developers of the stalled Filene?s redevelopment project from paying $12 million in linkage and community benefits payments. Also troubling is that the city did not include in its loan eligibility criteria strict local hiring mandates, particularly given the fact that these loans are intended to strengthen our local economy.
By definition, these types of loans are intended to support development and create jobs in distressed communities. At a time when all of our neighborhoods are reeling from the economic downturn, this gap-loan funding should be more evenly distributed throughout our communities instead of targeted at a handful of large projects. This could have been achieved by administering more of the funding to our city?s diverse small businesses and start-up companies, which would have ensured that each of our neighborhoods could benefit from new growth and new jobs. Soliciting input from residents about how to distribute the federal dollars would have further guaranteed the investments would be made in projects backed by the community. The city should also have used these funds to incentivize green design and construction by prioritizing allocation of the funding based on the sustainability of prospective projects.
While the city claims that the awarded development projects may create up to 2,000 permanent jobs and hundreds of construction jobs, I question that these jobs will go to Boston workers and will provide the training necessary to prepare workers for long-term career paths, not just short-term employment. In March, I advocated on behalf of the Chinatown community for the W Hotel to include job training and English language programs for area residents seeking employment at the hotel. As a longtime supporter of improving our city?s abysmal compliance with the Boston Residents Jobs Policy [which requires at least fifty percent of the total employee worker hours in each trade to be by Boston residents, at least twenty-five percent by minorities, and at least 10 percent by women], I believe that compliance rates on awarded projects should be regularly posted online and shared with community organizations that help residents find employment.
All of these strategies would help ensure that the Boston Invests program is making the right kind of investment-in our city?s workers and families.
Kevin McCrea:
Menino?s business dealings show him to be a Reaganesque "trickle down" economist. I was at the Burke High School recently where a panel of Menino?s cabinet people explained how the Recovery money would be spent. During question time, an African-American woman asked if there was any money for a hard-working woman who had lost her job and was facing foreclosure. The answer was "no," but we?re looking into that. An African-American man asked if there was any money for job training for adults at Madison Park Trade School. The answer was "no," but we?re looking into that. I asked why we were giving millions of HUD money to the W hotel? The answer was "because they were facing foreclosure." I appreciated the honesty. In Menino?s world, if you are a rich developer selling multi-million-dollar condominiums downtown and are facing crisis, you are eligible for government handouts. If you are poor or working-class and need help, they are looking into it. I question why we aren?t using the HUD money to finish the Ferdinand Building in Dudley Square (which the mayor promised to do four years ago) and bring both construction and permanent jobs to the inner city. I favor the economic model espoused by Nobel Prize winner Muhammad Yunus where more loans of fewer dollars are given directly to working-class people to help them start and expand their small businesses, which tend to hire local, and more directly benefit the local economy.
Mayor Thomas Menino
It is unfortunate that Shirley Kressel?s August 12 column, "What to do with the HUD $," takes such a cynical view of my administration?s mission to encourage job creation and continue development despite the current economic downturn. The Boston Invests in Growth program will provide a shot in the arm to stalled real estate development projects and keep Boston moving forward using the federally subsidized Section 108 program. Make no mistake, this funding will put people to work and encourage growth in our city.
Ms. Kressel attacks three projects that will bring jobs and economic vitality to our neighborhoods. To start, the "upscale" grocery store that she refers to will be located in an area of the city that has no grocery store at all. Ms. Kressel also misrepresents a Hyde Park project as a "1960s-style" shopping mall when it is anything but. This project will incorporate a neighborhood village market feel into its design, and it is also in an area of the city badly in need of services like a full-scale supermarket. I?ve been a longtime proponent of local, healthy food options, and this project will offer residents easy access to wholesome food.
Located on the border of Hyde Park and Mattapan, the new development will bring vitality, services and jobs to a site that has been home to a dilapidated paper factory that has scarred its landscape for many years. If you ask neighbors, they will tell you how excited they are to welcome this project.
Ms. Kressel, however, reserves most of her displeasure for the W Hotel project, which she argues is receiving too many public resources while not returning enough in the form of wages and services to the residents of Boston. She fails to understand that the W Hotel will provide low-barrier, entry-level jobs to many folks that urgently need them. The fact that there have been over 3,000 applicants for those jobs indicates as much. Furthermore, the Starwood Hotel chain, more than other hotels, has a model of internal upward mobility that allows newcomers, non-English speakers and low-skilled workers to move up to better paying and supervisory jobs.
Ms. Kressel?s argument also ignores the fact that the last time the city used Section 108 resources to fund a hotel, as was the case with the construction of the Westin at the Boston Convention & Exhibition Center, it profited $ 6.2 million on a $15 million dollar loan. Those dollars were then used to fund other greatly needed community development projects.
While the Section 108 resource was initially seen as a way to jumpstart stalled projects as well as ongoing projects that had lost parts of their financing as a result of the tight credit market, we wanted to see that smaller neighborhood economic development projects benefited as well. Consequently, ten percent of the total funding was set aside for this purpose. If there is a pipeline of such projects to fund, we will do so. To date only one has come forward despite our best efforts, an indication of the difficulty of financing at this time. We believe that a prudent mix of both neighborhood and downtown development projects create jobs and opportunity for a spectrum of Boston?s residents.
Arguing that lending to these projects is a form of corporate welfare is simply a misunderstanding of how the program works. These are not grants, but loans that carry hefty interest rates. If not for the tight credit market and their inability to gain financing through conventional lending mechanisms, developers would not approach the City for this resource at all. We believe that when private sector lenders walk away from good development it is the role of government to do what it can to keep the economy rolling and people employed.
Ultimately, Ms. Kressel implies that resources are being squandered, when nothing could be further from the truth. Every one of the developers of these projects would attest to the fact that the Department of Neighborhood Development (DND) has been rigorous in evaluating the quality of their project. Moreover, we have adequate resources to fund more projects. Initially, the Boston Invests in Growth program requested $40 million in Section 108 resources from HUD. However, DND has secured a total of $69 million, which will allow the city to consider funding many worthy new projects.
In this tough economy, we owe it to all of our residents to use every resource that we can access to keep Boston on the right track for sustained economic growth and smart development.
Sam Yoon:
Boston?s development process is dangerously flawed and in need of a complete overhaul. The lack of cohesive vision, strategy, and accountability in the way the mayor is using $40 million in HUD funding is just one more reason why we need change. The Boston Redevelopment Authority needs to be eliminated and replaced by a city planning agency, bringing us in line with every other modern city in America.
It is time to end top-down, politically driven planning in our city, especially during these difficult economic times. We need to embrace community-driven, bottom-up planning that would provide real community economic development for Boston residents and neighborhoods.
In fact, there are dozens of worthy community projects in the pipeline right now. For years Boston communities have fought for and planned for new uses of vacant land for housing, youth services and small, local business development. Nonprofit and ?good guy? developers have teamed up to work with communities to map out visions for development and job creation in our neighborhoods.
But as was suggested in the article last week, some of these projects were stalled because of lack of financing. So while the W hotel gets $10 million, Jackson Square in Jamaica Plain and Bartlett Yard and Parcel 3 in Roxbury wait. These projects should be the priority, not the afterthought, for federal gap-loan funds.
Forty million dollars in HUD funding was intended to jumpstart community development and job creation. This funding does not belong to Tom Menino. We also need a real community-planning agency. Because unlike the BRA, this agency would belong to the residents and taxpayers of Boston.
Shirley Kressel?s latest missive about HUD ("What to do with the HUD $?," 8/13/09), follows the pattern of other columns she has written. I would like to write a column on "What to do about Shirley Kressel?" Shirley, if you didn?t know it, is right. Right on everything. She doesn?t share an opinion, she pontificates.
What bothers me so much about Shirley is her own ego clashing with the everyday reality of what life is really like.
Regarding her latest piece, she cannot get herself to say that the jobs provided, just might, just maybe, be OK jobs. I work in a low-paying job. That is OK, Shirley. I made a choice to do this. Really I did. Call me crazy, but I like my job. Maybe some people like working as a front desk clerk. I?ve done that too. No problem.
Shirley was at her best, however, when warning us of the possible horrors of the Post Office Park model. I walk through it everyday, often several times. Last week, on a beautiful day, there was a string quartet playing, people were sitting on cushions provided to park-goers, and I must say, I am not sure I have ever seen a more beautifully used park.
Shirley, you would take away that park, you would let the W fail, all because you are right. Let?s get the horrible garage back where the park was and let?s bring back the combat zone. That?s where Shirley would lead us.
I have no idea how you became a spokesperson in this community.
Please, stick to writing a letter every once in a while.