Adam Friedman wants New Yorkers to make things. Friedman, the director of the Pratt Center for Community Development, has long seen a potential for New York to become a 21st-century version of the manufacturing hub it once was — not with heavy industry, but with small, sustainable methods of production. We spoke to him about 3-D printing, $2,500-a-month studios, and ongoing projects, like the Brooklyn Navy Yard, that he believes show promise.
The Pratt Center has been doing community development work for fifty years now. What would you say are the community development challenges Brooklynites face today that they didn’t fifty years ago?
In some ways, there’s almost nothing new. The multifaceted problems challenging communities existed then, and exist now — gentrification, inadequate mass transit, inadequate open space. But I think what’s happened is the scale of the disparity between low-income and affluent communities is just off the charts now. And the real estate pressures today are of an unparalleled scale. The price of land, particularly in Brooklyn, has just been skyrocketing. Back in the sixties and seventies, the pressure on urban manufacturing was foreign competition and land cost. A lot of the offshoring that occurred may have been inevitable, just because the labor costs were so low. All the costs were so low, including the costs of transportation and energy. It didn’t cost anything, really, to bring stuff in from China. It’s dramatically different today. Energy costs are going up. The cost of importing, for example, from China, goes up something like 17 percent a year, because their labor and energy costs are going up so rapidly.
But in New York, we still face the challenge of very, very high land costs and gentrification, so there’s real estate instability. And there’s much greater attention paid, at every level of government, to manufacturing. If you look at federal policy, the heart of the Obama administration’s economic revitalization agenda is largely around manufacturing. In some ways, that federal agenda is actually dependent on what cities do. There has to be the land, workforce development, and infrastructure to create a place and opportunity for that rebirth to occur.
There are a lot of big factors at work which bode well. There’s definitely been a shift in consumer preferences. People are rebelling against the homogeneity of Wal-Mart. They want to buy stuff that reflects local values and aesthetics and supports the local economy. There’s also a shift in decision-making by business owners, who are deciding where to locate their business on other factors now. They want to be at the center of their market, they want to have contact with their consumers, they want to be in the middle of the talent pool that creates new designs and is more highly skilled, and they want to reduce their transportation costs as well. People realize that if you have to truck everything in, you’re gonna have a big carbon footprint. So there’s a lot of factors at work leading to these changes.
We’re also seeing big changes in technology that make small-scale production much more economically viable. 3-D printing, additive manufacturing, computer numerical control: these technologies are transforming how things are produced. You can have urban manufacturing at a much smaller scale, which bodes well for cities. The challenge that cities face is that you have all these big old buildings that were built for a single user. The Swingline Stapler factory in Long Island City, Farberware in the Bronx: that’s not what manufacturing looks like today, so we’ve got to figure out how to take these buildings and convert them for modern manufacturing. Brooklyn has been at the forefront of that, from the Pfizer building, the Brooklyn Navy Yard, Industry City. The other thing going for Brooklyn is it’s the epicenter of design. Not only is Pratt here, but there are design schools throughout the city which have been very much attracted to Brooklyn, or have alumni in Brooklyn. There’s a wealth of design talent here.
You wrote an op-ed in the Huffington Post a couple of years ago in which you cited the need for the federal government to restructure financing programs to facilitate the rezoning of older industrial buildings for use by smaller companies. You also said highways, rail, and port facilities were areas that needed reinvestment. How well do you think that has gone since you wrote the piece two-and-a-half years ago?
Somewhere in the middle. There are some new financing programs, but they tend to focus on advanced manufacturing, and the definition of that tends to be very engineering-oriented. The real estate challenges really haven’t been addressed, either—the need to finance the conversion and modernization of the old industrial spaces.
The Economic Development Administration has provided grants to the Navy Yard, for example. I don’t have the exact numbers, but the EDA has helped underwrite the conversion of those spaces. So that’s a success. What hasn’t changed is the industrial revenue bonds program, which is probably the premier federal vehicle for industrial development lending. You cannot use it for rental properties. In cities, that’s what you need—manufacturers in large cities tend to rent. So they don’t have access to it.
On the city level, we have to deal with the zoning. That hasn’t happened, but I think we’re all very optimistic that this administration will do that. De Blasio, during the campaign, put out an industrial policy paper which spoke to the need to modernize zoning, so that you have stable industrial areas where companies want to reinvest and grow. There are a bunch of non-industrial uses that are allowed in our manufacturing areas: self-storage, hotels, charter schools, superstores, office uses that are unrelated to manufacturing—they’re all allowed, and that destabilizes the industrial owner. So the business owner, who doesn’t own his space, may be very hesitant to reinvest knowing that his space could be converted.
You’d mentioned some new, technologically-driven initiatives within urban manufacturing. I want to talk about MakerBot, which one would think is a perfect example of what a Brooklyn-based manufacturer of the future looks like—they embody green urban manufacturing in a very on-the-nose way. But it also seems unique, and maybe not replicable. To what extent is MakerBot an outlier versus a model for other companies?
What’s the characteristic that would make them an outlier—their scale? There are some large-scale manufacturers of very advanced equipment that are opening. MakerBot is an example of that. There’s another one in Long Island City, Shapeways, of a similar scale, and one in the Navy Yard, Crye. It’s not so isolated. I’ve not had this discussion with any of these companies, but why are they here? It must be due to proximity to market, both for design and marketing reasons. They can keep their fingers on the pulse. Crye makes very high-tech military apparel, and they’re growing by leaps and bounds. We’re not going to see as many large manufacturers as we did in the past, but it does occur.
Bre Pettis, MakerBot’s CEO, was just named co-chair of the Downtown Brooklyn Partnership, along with MaryAnne Gilmartin, CEO of Forest City Ratner. How would you evaluate the success of the DBP of weighing the interests of the public versus the interests of the developers it represents?
I think we’re not there yet. It’s a little too early to say, but what will be critical over the next year is the extent to which they’re willing to assure that there is space for production. It’s not only the highest segments of the market that need space, but where things are actually made. One of the strategies we’ve advocated for is design-production mixed-use districts. The provision for some production space has to be assured so that manufacturers are not gentrified out. The sooner you do that, the better. The irony is that having production capacity is what makes the higher-end design and engineering uses attractive. The dilemma is: some uses pay a lot of rent, some uses pay a lower rent. So how can you assure that balance moving forward? The answer is everyone has to give a little bit.
Is there one such existing development you’d cite as a model for this kind of harmonious space?
I think Pfizer is pursuing that strategy really well. They have real production space.
That building is amazing.
Yeah, we need more cool developers! Or more developers that are driven by that sort of vision, who get that a mixed-use space creates a synergy which makes everything more valuable.
When a new development project is announced in Brooklyn, what should current Brooklynites be attuned to? What should they be alarmed by? Almost every project in the past couple of decades has aimed to create jobs and make a neighborhood “vibrant.” How can a layperson look critically at new development projects and distinguish the bad from the good?
Nothing is an either/or situation. We need more development, but it’s often assumed that it has to displace something. That’s not necessarily true, but when it is, we have to take steps to remediate it. No one should walk away losing. We just have to learn to think more holistically. You see this all the time in housing, or in things like Atlantic Yards: you need school space, open space — there’s a whole variety of things that create healthy communities, including jobs. In the past, the city has not fostered that comprehensive, inclusive, organic development. When North Brooklyn was rezoned originally, along the waterfront, it clearly pitted those new development projects against this incredibly vibrant, diverse community. I think the lesson learned is that if there’s an upzoning, a lot of people make money. Some of that wealth should be recaptured through special assessments and plowed back into the community to keep it diverse, whether that’s in the form of affordable housing, affordable space for production, open space, etc.
That’s the fear with the Greenpoint Landing project, isn’t it? That the same thing that happened in Williamsburg is gonna happen in Greenpoint, and ultimately it’s going to be bad for the community members who aren’t already paying $2,500 a month for a studio.
Right — so we’ve gotta figure out a way to have more balanced development. We need more jobs, we need more housing. So how can we do that in a way that doesn’t lead to that sort of displacement?
What do you think is the best way?
In general, we need mandatory inclusionary zoning. Whenever there’s a large development project, there have to be some units that are affordable. On the industrial side, the wholescale rezonings have to slow down, and the existing zoning needs to be tightened up, so that you can’t have all these conversions as of right, which destabilize the community. And we need a different type of mixed-use zoning. When an area is converted from manufacturing to residential, there’s no reason you couldn’t require some space be preserved for manufacturing, either on site or through a non-profit that would assume that responsibility and get paid by the developer, just like affordable housing.
Another thing you mentioned in your op-ed was a study co-authored by the Pratt Institute and the Brookings Institution identifying urban manufacturers as critical to economic recovery but often overlooked in policy debates. Why do you think that is, and do you think that’s changing?
I think it was the case because the industry had gone through such dramatic decline, and as a result two things happened: first, in the old days, everyone had a family member who worked in a factory. In New York City, even into the sixties and seventies, people had personal contact with a manufacturer. As industry shrank, we lost that public recognition. Second, because it went through such a dramatic loss, baked into the popular conception of manufacturing is this misperception that it’s now gone. That there’s no manufacturing left. Or that any investment is likely to fail. But New York still has a big manufacturing community—somewhere around 6,500 businesses and 70,000 jobs. Other cities pale in comparison. It’s not anywhere near what it used to be, but it’s still big numbers. And other cities have lost so much of their industrial base that their designers cannot get things locally made. We’ve had discussions with people in San Francisco, Philadelphia, Baltimore, etc., who say that their designers have to ship to New York for production. That gives you some idea that even though the size of industry is smaller than it was, there’s definitely a critical mass here, which creates opportunity for growth.
It seems to me that the future is not so much having huge companies here that do an enormous amount of manufacturing, but rather a lot of smaller companies that are focused on more sustainable initiatives.
Right, definitely. The growth is in small manufacturers. We also did a survey of companies in the Navy Yard. Those that had adopted a green manufacturing strategy or sustainable business practices were significantly more likely to have had growth over the preceding twelve months. We’re doing better.