Greenwich South is transformed, but at what cost?

<< The area known as Greenwich South, the blocks directly south of the World Trade Center site, is primed for development.

By Ronda Kaysen

The neighborhood south of the World Trade Center — one of the oldest in the city, with some buildings dating back to the 18th century — is on the cusp of a sea change.

Greenwich Street South sits immediately south of the Trade Center site, a narrow cradle of streets tucked in the space between the West Side Highway and Broadway. The small, longstanding residential enclave is home to the Pussy Cat Lounge gentlemen’s club, tawdry lingerie shops and a few restaurants.

Soon, it will experience a sweeping transformation. Huge luxury towers will rise along Washington St., redefining the streetscape, and a spate of condo conversions will redefine the buildings that remain.

“A change of the character of the neighborhood is happening,” said Frank Graziadei, C.E.O. of the Brauser Group, which is developing 111 Washington St., a high-rise residential condo designed by Garrett Gourlay. “The whole area could very easily be the next Soho or Chelsea or Tribeca. Greenwich St. is going to be a little nook.”

Developer Gerald Brauser plans to transform his six-story parking garage at the corner of Washington and Carlisle Sts. into a 50-story, 300-unit luxury condo, with an eight-story garage.

Last December, Brauser, an 80-year-old Polish-born developer, paid $12.6 million for 105 Washington St., a six-story building that used to be home to the True Buddha Diamond Temple. Last August, he bought the building directly behind it — 104 Greenwich St. — for $10 million.

He plans to demolish 105 Washington St., a 1926 building, and replace it with a public plaza. He has no immediate plans for the Greenwich St. property, which is currently home to the Remy Lounge restaurant. “It would have been nice to do something where you can join the two buildings, but you can’t do it,” said Graziadei, adding that his company might eventually develop 104 Greenwich.

Brauser isn’t the only developer with large ambitions for the neighborhood. A new 53-story, Gwathmey Siegel-designed condo-hotel tower will rise at 123 Washington St. — directly across the street from 111 Washington. The $240 million building, owned by the Moinian Group, will include a hotel and 180 residential condo units.

Talks to bring a W Hotel to the site recently fell apart, Crain’s New York reported last month.

Developer Sam Chang plans to transform the parking garage at the corner of Rector and Washington Sts. into either a hotel or a condo. Plans for that property “are still in the conceptual stage,” Gary Wisinksi, C.O.O. of McSam Hotel told Downtown Express.

For some, the high-rise developments come as no surprise. “That’s been the plan since Sept. 12, [2001] — to turn this neighborhood into high-rise residential development,” said Kevin Cunningham, executive director of 3-Legged Dog, an arts organization that recently built its new headquarters at 80 Greenwich St. “We’ve always been concerned with this — the disaster as an opportunity for high-end development. It’s not the right way to approach redevelopment.”

The Lower Manhattan Development Corp., the agency created to revitalize Downtown after Sept. 11, 2001, proposed a $125 million Greenwich South revitalization project that would include decking over the Brooklyn-Battery Tunnel and building park space, a commuter bus garage and a safe east-west walkway. Although the project was never fully funded, the L.M.D.C. earmarked $40 million for it last summer. Another $40 million in 9/11-related transportation funds was also set aside for it.

But the L.M.D.C. announced this summer that its job has finished and the agency will soon dissolve. It is unclear what money remains for the project and who will take over the project.

A city official who requested anonymity said it appears the L.M.D.C. shifted the money from the Greenwich South plan to cover the ballooning costs of the demolition of the contaminated Deutsche Bank building at 130 Liberty St. The official also said that although the city likes the idea of revitalizing Greenwich South, it would make significant changes to the L.M.D.C. plan.

The L.M.D.C. insists the money will materialize. “While funding for Greenwich Street South has yet to be authorized, like many projects, there are multiple sources of potential funding for Greenwich Street South,” said L.M.D.C. spokesperson Kori-Ann Taylor in an e-mail.

For all intents and purposes, the revitalization of Greenwich South has happened without any city planning. And some worry that an explosion of new residential development without amenities like grocery stores and schools could destroy the neighborhood.

“We don’t need more housing, we need shopping,” said Pat Moore, a member of Community Board 1 and a Greenwich South resident. “Do they ever take into consideration the people who live there? What we need is a grocery store. We need places to park. How are all these people going to get on the subway?… Everybody keeps building and nobody seems to be concerned.”

The new high-rises are only part of the Greenwich South renaissance. Residential and condo conversions are also on the rise. Buttonwood Real Estate bought the 38-story, Art Deco, residential building at 88 Greenwich St. for $87 million last December and plans to convert it to condos.

Giovanni’s Atrium, a 32-year-old Italian restaurant at 40 Rector St., will have to move in three years — the landlord plans to convert the commercial building to condos, said Suzan Natalucci, who owns the restaurant with her husband, Giovanni. “A lot of changes are going to take place and we’re hoping to survive,” she said.

Some business owners still struggling from the loss of office workers after 9/11 welcome the new development. “Anything is an improvement over that dusty coal pit” at ground zero, said Henry Martuscello, who owns 108 Greenwich St. and sold the building’s air rights to Brauser for the 111 Washington project. Martuscello is also general manager of Caracello restaurant, which has been at 108 Greenwich since 1936.

“From our point of view, it’s not bad for us to have people with high disposable incomes who are well educated,” said Cunningham of 3-Legged Dog, the arts venue. “At the same time, I’d really like to see affordable housing down here. I can’t afford to live here, I had to move to Harlem.”

Many longtime residents expressed deep apprehension about the future of their neighborhood — and their place in it. “I still find it so hard to believe that all these big buildings will be going up all around us and our stupid little building will remain,” said Nancy Keegan, a 109 Washington St. tenant.

“It’s like looking at dead bodies when they tear these buildings down,” she said. “It’s sad, it’s really sad. It’s one of the last areas in the city with such historic buildings.”

Ronda@downtownexpress.com