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Brooklyn Brewery's Steve Hindy went public last month with his difficulties in finding affordable housing for his expanding business in its namesake borough. Posting his gripes on the website of the local think tank Center for an Urban Future, Hindy explained that his dreams of opening a new facility on Brooklyn's waterfront had gone as flat as warm beer.
Going public resulted in calls from officials who want to woo Hindy to other areas—Queens, the Bronx, and Nassau County—and garnered the brewer some media: He wrote an op-ed in the Daily News and was profiled in this weekend's New York Times.
The attention isn't really surprising, considering the popularity of Hindy's beer—which is the reason he's outgrown his Williamsburg factory. Twelve years ago, the heart of Williamsburg was so rundown that landlords were begging for tenants, Hindy says. But that was before the neighborhood became a hipster mecca, and rents went from about $3.50 per square foot in 1996 to around $20 today.
So Hindy turned to the city's Economic Development Corporation to help him find a place to expand operations.
It was a good bet that the city would be willing to help a man with his civic record: Hindy's a board member of the Prospect Park Alliance and the Brooklyn Historical Society. He's been a darling of the Bloomberg administration, an early champion of its rezoning of industrial Williamsburg and Greenpoint three years ago. The mayor wrote the foreword to his 2005 book, Beer School: Bottling Success at the Brooklyn Brewery.
In 2004, the EDC offered Hindy prime real estate on Pier 7 at the far end of Atlantic Avenue. The Port Authority owns the 100-acre stretch along the Brooklyn waterfront, which is made up of two contiguous shipping terminals: the Red Hook Container terminal and the Brooklyn Marine terminal. The EDC had begun negotiations for a city takeover of a sizable portion of the port the previous year. Hindy says the EDC all but promised him the space: He was told by a staff member that the EDC was "under orders" to help him relocate. (An EDC spokeswoman, Janel Paterson, couldn't confirm this comment but says that the brewery had been part of the agency's plan for the pier).
The beer brewer was gleeful—naively so, he now says. He was already envisioning afternoon happy hours with a striking view of the lower Manhattan skyline. His distributor, Phoenix/Beehive, the largest Heineken distributor on the East Coast, would come along, too, and provide more than 600 jobs, according to the EDC.
Hindy didn't realize that he was about to get caught in a red-hot real-estate battle between two powerful sets of interests that had their own ideas on what to do with the waterfront: the marine-container shipping company American Stevedoring, Inc. and its political backers versus Mayor Bloomberg and the EDC. When negotiations between the city and the Port Authority fell apart late last year, Hindy says he was "flabbergasted."
For 40 years, American Stevedoring has moved containers along the waterfront, including Pier 7. Each year, the company moves 50,000 containers, storing lumber, appliances, and, until recently, most of the cocoa in the region. The business provides 600 jobs, many through the International Longshoremen's Union, and generates $36 million in wages annually and an estimated $4.5 billion in container traffic.
After enlisting the nephew of Charles Gargano, the powerful vice chairman of the Port Authority until last year, as legal counsel, American Stevedoring president Sal Catucci had been lobbying the authority to give him a long-term lease along the port.
But the Bloomberg administration had its own plans for the pier: In addition to the brewery and Phoenix beverages, the city also wanted to open the pier up to cruise-ship operations and public waterfront access. Rumors had it that condos and high-end residences would soon follow. "They saw the container port moving the city's essential goods as dirt, and that they could turn it into residential gold," says Matt Yates, director of commercial operations for American Stevedoring, referring to the Bloomberg plan to expand cruise-line operations.
The EDC says it never had plans to build residences on the waterfront, that the cruise lines would have occupied only a small portion of the pier, and that it had no intention to discontinue maritime businesses there. If the city had taken over, American Stevedoring could have entered an open bidding process for the rights to continue operations along the pier.
American Stevedoring enlisted City Councilman David Yassky and Congressman Jerrold Nadler to fight the EDC's plans. Catucci is a big donor to the two politicians, who both say they're proponents of maintaining blue-collar jobs in a city that has lost hundreds of thousands of manufacturing positions since the '70s.
In late 2007, the City Council sent the EDC a letter saying that it wouldn't support the agency's bid for the pier, effectively ending the EDC's negotiations with the Port Authority. American Stevedoring got a new lease that lasts until 2018.
Hindy's brewery, his distributor, and the cruise ships were out.
The EDC, meanwhile, sounds contrite. "We are committed to finding Steve a home," says Genn. "What happened in the past shouldn't impinge on our ability to achieve success in the future for all."
Despite these travails, people like Jonathan Bowles, the director of the Center for an Urban Future, say that Hindy can actually count himself lucky to have so much visibility and political support.
"If a Steve Hindy or a Lowell Hawthorne [the Bronx-based owner of Golden Krust Bakery & Grill] are having significant difficulty finding space for their businesses to expand," says Bowles, "you know that the average small or midsize manufacturer is struggling in much larger ways."