Bloomberg Businessweek - USA (2019-12-23)

◼ ECONOMICS Bloomberg Businessweek December 23, 2019

37

PHOTOGRAPH

BY

ROB

STEPHENSON

FOR

BLOOMBERG

BUSINESSWEEK.

DATA

(LEFT):

MINISTRY

OF

FINANCE

JAPAN,

BLOOMBERG

INTELLIGENCE.

DATA

(RIGHT):

COMPANY

WEBSITES

towersoutfittedwithluxuryamenitiessuchas

dog-washing stations and rooftop fire pits. The

way they see it, every New York City rent increase

means more potential Westchester residents.

“Let them raise rents—please keep on making it

expensive, because then people are going to have to

make a choice, right?” says Luiz Aragon, the devel-

opment commissioner of New Rochelle, who’s

overseeing the revitalization of the downtown, an

approximately 300-acre project that includes three

luxury buildings already welcoming renters. At his

offices, an advertisement set on an easel features

a digital rendering of the skyline as it will look five

years from now, every window gleaming in the eve-

ning sky. “The New New Rochelle,” it reads. “Your

City Outside the City.”

Westchester’s property taxes are already among

the nation’s highest. So the county is on a push to

boost population density to raise revenue for its

bulging public school budgets. The building boom

is most intense in New Rochelle, with a population

of 79,000 inhabitants, and in Yonkers, which is just

shy of 200,000. Both have struggled to turn around

their fortunes since an explosion in suburban malls

in the 1970s and ’80s hollowed out their downtowns.

The municipalities are banking that a growing popu-

lation of well-educated, mostly single workers could

bolster the tax base without burdening the schools

with more children, as well as attract new employ-

ers. So they’re encouraging development with long-

term tax breaks and speedy permit approvals.

New Rochelle, which was the setting for the 1960s

sitcom The Dick Van Dyke Show, has a pipeline of

6,300 luxury rental units in the works, street Wi-Fi

kiosks, benches that double as phone charging sta-

tions, and a free on-demand shuttle service. New

businesses include the Encore Esports video game

tournament lounge and the Bad Axe Throwing

bar, set to open this winter. “We’re not anticipat-

ing everyone will pick up and leave Brooklyn and

Manhattan, but a small fraction is enough,” says

Mayor Noam Bramson.

Building so late in the economic cycle—America’s

record-long expansion is now in its 11th year—has

obvious risks. A decade ago, cities in Westchester

County including Yonkers and New Rochelle also

added units at a fast pace. Then the bottom fell out

of the market. On the flip side, if demand for the lux-

ury rentals does materialize, it could drive up hous-

ing costs in the county’s last remaining affordable

towns, says Lynn McCormick, an associate profes-

sor of urban planning at Hunter College who lives

in New Rochelle. “We’re hyperdeveloping areas

around transit hubs, hoping to attract people with

money,” she says. “It’s the gentrification story all

over again. The inner cities are tapped out, so now

we’regoingtothesuburbs.”

BethAcocella,a NewRochellenativeandsales

agentatthe110-unitMillenniarentaltower,says

shehopesyoungNewYorkersarrivebutsuggests

thecityshouldputequaleffortintodrawingolder

localswhoaredownsizingoutofsingle-family

homes.TheMillenniawillfeatureanindoorputting

green,freeinternet,andconciergeservicessuchas

dogwalking.Rentswillrangefrom$2,150fora stu-

dioto$3,800forthemostexpensivetwo-bedroom

units.“Iwantallthisnewdevelopmenttowork.We

wantmorepeopleinthecitywhowillgotothewine

barandwalktheirdoginthedogpark,”shesays.

“Theriskcouldbetoomuchinventory.”

Yonkershasabout5,900luxuryapartments

underconstruction,streetcornerartwork,anda

sloganthat’sa nodtothedemographicit hopes

willliftthesaggingtaxbase:“GenerationYonkers.”

TherecenttalkofrecessionhasonlyspurredMayor

MikeSpanotomovemorequicklywitha revitaliza-

tionprojectthat’salreadyshowingsomeearlysigns

ofsuccess.There’sa Brooklyn-stylebagelshop

anda gymcoming.AndLionsGateEntertainment

Corp.,drawnby federaltaxbreaks forinvest-

inginlower-incomecommunities,isplanninga

$100million-plus production facility.

Choudhary Chilukuri, a 34-year-old gradu-

ate student at Mount Sinai medical school, says

he and his wife only considered Yonkers because

they were so disappointed with what they could

▼ An apartment

building under

construction in

downtown New

Rochelle

● Driving distances

in the New York

metropolitan area

●Ax-throwingbar

●Ax-throwing bar

coming soon

Yonkers New

Rochelle

Downtown

Brooklyn

15 mi.

20 mi.

7 mi.

Midtown Manhattan