The Cayuga Green project to build heavily subsidized parking garages, apartments, stores and a 12-screen movie theater will not bring the promised benefits. Moreover, it will fall flat on its face, and be costly to generations of Ithaca residents and taxpayers.
Strong language? Perhaps. But it is justified by compelling facts. Let's consider the project piece by piece.
Cayuga Street Garage
The City has just built an eight-level, 800-car garage on South Cayuga Street. The demand for this garage is so weak that the city has already closed off the top four levels of the garage. Of those who do park in the garage, about one-quarter are paying customers. The rest are getting free parking.
The retail space under the garage has been sitting vacant for months. Maybe, with enough subsidies to some tenants, the space will be occupied, but the income will never pay for the cost of that space.
The best retail location on South Cayuga Street is at State Street. As one goes further south the location gets weaker and weaker and weaker. The best retail location on the Cayuga Green block is the corner that was formerly occupied by Woolworth's.
When Woolworth's left, the landlord, Dave Abbott, who was one of Ithaca's most talented businessmen, was unable to rent the space, even at bargain rents. Why would there suddenly be demand for retail space under the garage? It is a clearly inferior location!
Worse, the stores continue around the corner onto Prospect Street, which has never been a retail location and it won't become one now.
Environmentalists should notice that the retail space requires cars that park in the garage to drive additional distance and an additional height or more than 16 feet. This is an unnecessary waste of gasoline going up and brake wear going down.
Some may say that the garage will be full when the 12-screen theater opens. That won't happen. Here's why the upper levels of the garage will never be popular:
For someone to drive into the garage, go up the ramps, park on the top floor, walk to the elevator, wait, ride down, possibly with several stops, and walk to the center of The Commons takes about 20 minutes. The reverse trip takes just as long and there could be a wait to pay the parking fee. The grand total is 40 minutes.
Don't take my word for it. Do your own test and see how long it takes you. Even if you can do the round trip in as little as 30 minutes, this is still not appealing.
We are promised a 12-screen movie theater. I doubt that this theater will ever get built. But, even if it does appear, it will be out of business fairly rapidly. How can one know this in advance? There are two ways: by history and by logic.
History: Old-timers will remember when Ithaca had about six movie theaters in central downtown. One by one they closed down because the market just wasn't there and the theaters couldn't pay their bills. Now there is only the two-screen Cinemopolis. Where is the market to support 12 more screens?
Logic: Between the Pyramid Mall, Cinemopolis and Fall Creek theaters there are now a total of 15 screens. If the new theater is built, the total will grow to 27 screens. When the Regal Theater at the mall adds four screens, the total rises to 31 screens. Will the number of movie-goers also suddenly more than double? Of course, not!
Increasingly, people watch their movies from DVDs, movies on demand, and the numerous movie channels on television. This is a national trend that is reducing ticket sales.
Clearly, some of the movie theaters must go out of business. Which ones? I predict that either the Fall Creek or Cinemopolis will close and the new theater on Green Street will also go out of business. How can one predict that Cayuga-Green theater will close and not the theater in the mall? Here are four reasons:
First, the parking at the mall is more convenient than either the Green Street or Cayuga Street garages. Second, most of downtown closes earlier than the mall stores.
Third, the Regal chain offers a better choice of first run movies than the new theater is likely to have.
Finally, the developer of Cayuga Green has no record of demonstrated skill in managing movie theaters and has shown no interest in financing the marketing battle that will occur.
When the theater closes down, there will be a vacant single-purpose building, a repeat of the horror we had with the Strand Theater for more than a decade and the hulk that still exists at the Quad Cinema near Cooke Cadillac. Why recreate this problem?
The Cayuga Green project includes several dozen "luxury" apartments we are told will be rented to high-income professional people.
For this theory to work, there has to be a large luxury market that the Gateway apartments will not satisfy. In over a quarter century of building, owning and managing over 100 apartments in the core downtown area of Ithaca, I have not seen this market.
Sure, the new apartments will have tenants, but they will be mostly Cornell and Ithaca College students and downtown workers on a tight budget. This is a very price-conscious market. These tenants will not pay what it costs to build new luxury apartments.
Should the Ithaca working man and homeowner be taxed to subsidize either the professionals or the wealthy parents of the world? Is this a proper use of government power?
Let's review the promised benefits of the Cayuga Green project and see if there is a more efficient way to reach the same goals. Primarily, we are promised density, increased tax revenues and revitalization of downtown. All are worthy goals that deserve further examination.
Density: As I have explained above, the movie theater, if it happens, will be only a short term event. The density from a few dozen apartments is nice, but hardly worth the cost.
The same number of apartments, and probably a lot more, would be built without any subsidies or tax abatement if the City would merely repeal some of its numerous regulations that were put in place to retard development.
All this can be done at virtually no cost by the Common Council. There are landlords and homeowners who would build additional housing in many projects, small and large, if only the City would let them.
Tax Base: We are told that if the Cayuga Green project is given a tax abatement, that down the road there will be more tax revenue. If this idea is valid, it would make just as much sense for any other development in any other location in the city.
In that case, the right thing to do is to make the same tax breaks available as-of-right to anyone who builds any improvements in the city.
We are also told that City Hall wants to see more downtown tax base. But, why is a dollar of property taxes from downtown more valuable than a dollar from any other part of the city?
Revitalization: Of course, any successful new project can help improve the downtown and is to be applauded. But, without much improvement in parking and without a movie theater, what's left of the Cayuga Green project? An apartment house.
Could one medium sized new apartment house make that much difference? Is it worth the millions of dollars of expenses, subsidies, tax breaks that are built into Cayuga Green?
A year ago, I opened the Cityview Apartments, an unsubsidized 85-unit building about 300 feet from the proposed Cayuga Green apartments. The apartments are rented and providing excellent new housing for the residents.
Still, no one has come to me and said, "Thank you for these apartments. You have re-vitalized downtown!"
Long Term View
The costs of an unwise project, such as Cayuga Green will be paid over generations in higher taxes, reduced capacity to sell bonds, loss of faith in City Hall and other competing projects not built.
What benefit offsets these costs? Which politician would vote for this project if he had to pay for it with his own money?