Commentary: The Big Apple's Other Dream Project

In New York City, near the Hudson River, there's a threadbare neighborhood, ripe for rebuilding and redevelopment, where few New Yorkers live but many out-of-towners come to visit. Ground Zero? Guess again. It's the far west side of midtown Manhattan, an area whose future has drawn a lot less attention than the emotional rebuilding controversies over the World Trade Center site. But in the long term, what happens on these 360 acres could be as crucial to the city's economy.

In February, Mayor Michael R. Bloomberg unveiled an audacious plan to redevelop what he's dubbing "West Midtown." It will cost billions in public and private money and take up to 40 years to complete. The area, with the hulking Jacob K. Javits Convention Center at its core, is now mostly a grungy neighborhood of tenements, parking lots, warehouses, and railroad tracks. But if Hizzoner gets his way, it'll one day bloom with new parks, thousands more units of housing, and millions of square feet of modern office space. It would sprout a subway link to Times Square and a 50,000-seat stadium that could serve as the home of the New York Jets and, if New York is chosen, the main venue of the 2012 Olympics. What Bloomberg and his cohorts are calling for is no less than the creation of Manhattan's third business district, in addition to midtown and Wall Street. Says Dan Doctoroff, deputy mayor for economic development: "This is about how this city will work for generations."

This plan is not the usual urban-planning boondoggle, however. There's an important economic concept at its core: that an expanded convention center -- and tourism sector overall -- will provide critical jobs for entry-level workers, many of them among the 1.2 million immigrants who flooded into the city in the 1990s. "This could be their first step up the economic ladder," says Bloomberg. After all, the unskilled jobs that once flourished in factories or on the docks have been declining for decades. But the stadium and an expansion of the convention center could ameliorate that loss, making the area a new engine of job creation with a bevy of hotels, restaurants, and small cash businesses.

In New York, economic development policy has often focused on big building projects, which boost construction jobs, or on retaining white-collar workers by offering their employers costly incentives to stay in town. Those jobs do, indeed, yield higher taxes. But it's about time the city placed a bet on its working-class residents, those New Yorkers without union cards, MBAs, or law degrees.

Is this the right horse to bet on? Plenty of studies show that linking hopes for growth in tourism to specific projects can prove disappointing. New stadiums may burnish a town's image, critics say, but they don't necessarily deliver economic growth. And the same may be true of convention centers. "Big public-works projects that are geared to tourism really don't do that much for the economy," notes Celia Chen, a senior economist at Economy.com Inc. Even if job growth does occur, the cost to achieve it may never be recouped, while other job-creation strategies go unfunded.

More space at the Javits may not automatically mean more business, either. "They will simply have more space and no guarantee that it will get used," says Heywood T. Sanders, a professor at the University of Texas at San Antonio and a critic of the convention-center building craze. Sanders and others suggest that New York gets fewer conventions than it wants not for lack of space but because of expensive hotels.

Yet tourism is already big business in the Big Apple, worth about $25 billion in 2001, the last year for which statistics are available. That figure likely fell last year with the decline in business travel. But even as Wall Street jobs continue to evaporate, tourism holds up. Between the last quarters of 2001 and 2002, the city added 7,400 jobs in tourism-related sectors, bringing the total to 245,500. That's a likely sign, says Rae Rosen, an economist at the Federal Reserve Bank of New York, of tourism's resilience.

Those indicators could well keep pointing up when the economy revives. That's why New York needs to expand the Javits center. It has 818,000 square feet of exhibition space, far less than what's available in such convention meccas as Orlando, Chicago, or Las Vegas. Officials could spend up to $1 billion to add 500,000 square feet to the New York State-owned facility by 2010. The extra space, say experts, would give the Javits the flexibility to book more shows. At the same time, the city is wooing the Jets to a new nearby stadium, which it hopes will open in 2009 and which could also be used for exhibits. And the proposed No. 7 subway link would make the now-remote center more accessible to the rest of the city.

It's already getting late in the day for New York. Bigger convention centers are starting to rise in many cities, and competition is fierce. The $800 million Boston Convention & Exhibition Center, set to open in 2004, is offering a passel of incentives, including free rent for some early bookers of its 519,000 square feet. And in Chicago and other cities, public authorities have sought to goose convention business by financing nearby hotels.

Of course Bloomberg's plan is by no means a done deal. How it all will be financed is still uncertain. And "West Midtown" will have to overcome opposition from contentious and sophisticated neighborhood groups. Although they can live with the idea of a bigger Javits, they despise the proposed stadium, fearing noise and congestion. But the city is putting a lot of its political capital into the plan and may yet win them over. In the end, expanding the center may be less a matter of getting ahead than of not getting left behind. For a city that prides itself on being first, biggest, and best, that's simply not an option.

By Robert McNatt

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