Big Think Interview with Bob Lieber
Bob Lieber is Deputy Mayor for Economic Development. In February 2007, Lieber was named President of the New York City Economic Development Corporation (NYCEDC) and became Deputy Mayor in January 2008. Responsible for creating jobs and building capacity in the five boroughs, Lieber guides agencies including NYCEDC, Department of Small Business Services, Department of City Planning, Department of Finance, NYC & Company among others. He oversees job-creating area-wide redevelopment projects that include Willets Point, Lower Manhattan, Hudson Yards, 125th Street, Jamaica, and Coney Island. He also spearheads the effort to support a more vibrant and diverse City economy by growing varied sectors including tourism, media, bioscience, fashion, maritime support, film, and television. Lieber previously served as Managing Director at Lehman Brothers, where he was Global Head of Real Estate Investment Banking as well as a member of the Real Estate Private Equity business. In 1999, and again in 2003, Lieber was recognized by Institutional Investor Magazine for "Deal of The Year," and he was named "Financier of the Year" in 2005 by Commercial Property News. Lieber holds a BA from the University of Colorado and a Masters of Business Administration from The Wharton School at the University of Pennsylvania. He is Vice Chairman of the Zell-Lurie Real Estate Center at the Wharton School, and Trustee of the Urban Land Institute.
Question: What was it like to make the switch from private industry to public service?
Bob Lieber: I had a great career working on Wall Street. It was a very rewarding career, a great experience; I learned a ton. What I realized several years ago was that you need to change things up every now and then. You need to make sure that you're doing things that you're excited about; that you can get up in the morning and you can be motivated. And kind of the old rule that I used was, I never want to have a job where I have to use an alarm clock to get up in the morning. And I'd had, again, a great career at Lehman Brothers, and I looked around, and I said, you know, what else is there to do? Isn't there something else that I can do to make a meaningful contribution, to do something that capitalizes on my experience and my skills and apply it in a different way?
And when I looked at what Mike Bloomberg as Mayor of New York City was doing and the economic development agenda that he had, the development projects, the real estate-related projects that he had -- my background, you know, when I worked at Lehman Brothers was in real estate and real estate finance. So maybe there'd be something interesting to do sometime there. If New York City is actually able to get the 2012 Olympics, they may need to do something around real estate. So I've been watching this and thinking about this for several years. And then one thing led to another. New York did not get the Olympics, obviously, but still there were tremendous opportunities and grand plans. And I said, maybe there's a way I can go do something and make a different impact than the one that I've made in my existing career.
There was an opening I became aware about as president of the Economic Development Corporation for New York City, and I said, maybe this is a great time to try and do this. There's three years left in the Bloomberg administration; I can make an impact perhaps. I see what's going on: they're rebuilding, building a new Yankee Stadium, they're planning on building a new Mets Stadium, there's development around all these areas; this would be something that would be really interesting. So I called the then deputy mayor, Dan Doctoroff, and said, hey, you know, I don't know whether there's anything that I can do, but if you're interested, I'd be happy to talk to you. So one thing led to another, and I retired from Lehman in 2006 and started working for the City of New York in the beginning of 2007, and it's been a phenomenal experience.
I didn't really know what to expect going into this. My background was never around politics or public sector. As I joke with people, I never took a political science course in college. I mean, I did something that's really very new to me. But it struck me that there are things that still can get done. And bringing some of my background experience, private sector orientation, I think is helpful in some respects in terms of how do you identify projects? How do you prioritize projects? How do you establish a time frame and a set of goals and metrics that you can use to get things done? And one thing that's so different about this sector is that it -- different than the private sector -- is that in government there are many more competing priorities or objectives than in the private sector. Private sector it's pretty simple to figure out how do you get from here to there? It's really about where are the economics -- and the parties with whom you're negotiating or having discussions -- really driven about what's the economics? In the public sector there are a lot more issues that come into play, and there are a lot more factors that influence how decisions get made and how projects and progress actually gets made. It includes working with elected officials; it includes working with community boards and representative in the community; it includes working with the press and a host of different constituents on the local and the state and even in cases on the national level, in addition to what you would do working with the private sector.
So it's a lot more complicated than I thought it was going to be. In some respects it's easy to make a positive impact because there are some things that strike you as, gee, why wouldn't we do that anyway? And then there are other aspects of it that are much, much more complicated than what I thought. So I have to really be much more thoughtful about how you get from A to B, and what are the different steps that you need to employ to try and get there, particularly when it's -- and recognize it's not just about the economics.
Question: What goals did you have when joining the administration and how have they changed?
Bob Lieber: When I came into the Bloomberg administration, as I mentioned, it was kind of in year six, so I had years six, seven and eight scheduled to go, and a lot of plans had been created and conceptualized. And really what I was focusing on doing was trying to make sure we could execute as many of these projects and plans as we possibly could. So I think a couple of things that I've been perhaps the most proud of or satisfied with so far was being able to work with the community, to work with the elected officials, to work with our colleagues on the city council, and come up with a plan that we could re-develop 62 acres of land that is in a desperate condition out at what we call Willets Point.
Willets Point is in Queens; it's across the street from the new Mets Stadium at City Field. And it was an incredibly complicated project; again, lots of issues. Eminent domain was something that was a big issue for people, and trying to come up with a plan that worked and you could get buy-in, again, from so many different constituents. And it was something that for 50 years people have tried to do this. Back in the days of Robert Moses, he wanted to clear Willets Point as a part of the development of the 1964 World's Fair. And a young lawyer cutting his teeth by the name of Mario Cuomo got involved and represented the landowners there at the time and defeated Moses because it was not a plan that really developed a broad base of support from the community; it was kind of what he dictated had to have happen. So people said this is something you're never going to be able to get done. We did get it done. It's not me, but the byproduct of a lot of people and a lot work and a lot of effort and a lot of input from the community. So that's been very satisfying.
Another project that also recently concluded is kind of the reclamation and redevelopment of one of the most iconic names in the world, and that's Coney Island. This is a place that some of my old colleagues back in the days of E. F. Hutton we used to go for our summer outing. We'd go to Coney Island and ride the Cyclone and have hot dogs at Nathan's. And trying to find a way to recreate the history and the excitement of that incredible brand. But it's fallen into tremendous disrepair and was on the verge of extinction. Again we have come up with a plan, broad-based support in the community, but lots of other people trying to say no. We had landowner issues there as well, and we were able to get that through city council, and we're looking forward to coming up, is to really creating a revitalized Coney Island that kind of treasures the iconic history and nature but also brings it into the 21st century and capitalizes on a lot of the other natural resources or natural assets that exist out there, including the aquarium and the Cyclone Stadium, the Keyspan Park, where the Mets' subsidiary -- not subsidiary -- the Mets' farm team the Cyclones play.
Question: Hudson Yards
Bob Lieber: We're still working on Hudson Yards. We've got the train under way there to be able to open up development in that area. So I think the biggest difference when we think about -- what I think about the public sector versus the private sector and what I used to do as compared to what I do now, it's much more about thinking about the long term. In the old days, when I was in the finance world, it was a little more short-term. Long-term for us was six to 12 months. But now the decisions that we're making today and the changes that we're making today are going to have an impact on decades and decades from now and generations from now, so that one of the hopes is your kids will see things and your grandkids will see things that are still playing out from initiatives that we started during the Bloomberg administration.
So it's important to think about what the long term is and develop a plan that works for the long term, because too many politicians think about, I need to be there for the picture of the groundbreaking or the ribbon cutting, and if I'm not going to get credit I don't want to do it. What we're trying to do differently is think about what really are the long-term benefits of building and maintaining New York as a place that can be the most competitive and, as I say, the greatest city in the world.
Well, when you think about Hudson Yards, it's approximately 24 acres of contiguous area there on the West Side, what used to be relatively underutilized land. It was industrial manufacturing. More recently it had been parking lots and service stations, and you see a lot of maintenance facilities there. What we see for the build-out of Hudson Yards is 40 million square feet of mixed-use development that is residential, that's affordable housing, it's condos, it's cultural space, it's retail space, it's office space, it's a park. Grand Boulevard is going to be a part of it, so that again, this is something -- people will often focus and say, well, where are you? You've started this, you're two years into this. Are you on time, ahead of time, behind time? I think the important thing to note here is, we are trying to do things that have a long-term focus, and our job is -- or at least my job is -- to create the conditions that enable this kind of development to take place as the market conditions warrant and justify it. It's very difficult to build in New York City. It's expensive, it takes a long time, the process is difficult, and any time people or developers try and build something, oftentimes if you want to change land us you'll start in one economic cycle and end up in a different one.
So what we're trying to do here -- we've rezoned the entire area. We have a modification of rezoning taking place now for the western rail yards, but we think this is going to be a very exciting long-term growth area for New York City. In order for us to maintain our competitive position, we need to be able to continue to attract people. We want to make sure we can keep people here. We want to make sure we can be a place that can attract more people. So creating the supply and the capacity for people to be able to live, for people to be able to work, and for people to be able to raise their families is critical to what we're trying to do, and we do take a very long-term perspective on this.
One of the keys to our plan to build for the long term, as I mentioned, is having the transportation, having the mass transit alternative available so that we can aggregate people and get them around. And what we saw with the rezoning of Hudson Yards was the fact that while we're relatively near Penn Station and we're relatively near Times Square, we're actually relatively far from any real mass transit. And if you're going to open up 40 million square feet of future development, you need to be able to provide a mass transit alternative for people.
And the brilliance of the Hudson Yards plan is that we are building the extension to the No. 7 subway ourselves. We're not waiting; we're not relying on the state; we're not relying on federal dollars. If we're going to position ourselves competitively going forward, we've taken the responsibility to pay for the extension of that train. So work is under way now, drilling below grade to make the room for the trains to run through. So when development opportunities take place in Hudson Yards and the market supports that, we'll have the ability to support it with mass transit. And that's the only way you're going to be able to really accommodate that many people and that much development activity. So it's another part of how we're thinking about the long term, investing for the long term, and building for future capacity as we go forward.
This is the first extension. It's never been done that I'm aware of. This is really the MTA's responsibility, and that's a state agency. But it's the first extension of, addition to any subway service in New York City since the '60s. So for 50 years there's been no expansion of the system. The system has been significantly upgraded to a state of good repair since it was -- back in the '70s when we moved here it was horrible. I mean, you never wanted to get on the subway. It was dangerous, it was hot, it was unpredictable -- breakdowns, people -- it was awful. And all the graffiti. So those kinds of things have changed already, but in order to plan long-term you have to be able to make these infrastructure investments if you're going to really be successful.
Question: How has New York City changed since the seventies?
Bob Lieber: I didn't really think about it in this context until I got in this job, but we moved to New York City in 1977. New York City was on the verge of bankruptcy in the '70s and had slashed investment, and that was the famous President Ford New York City drop dead. And when I moved here from Colorado, and prior to that from California, you developed some coping mechanisms to get around in New York which were survival instincts. And you were always looking ahead, and you were always looking behind. And you always wanted to make sure you knew what was going on at all times, because even during the day you had to be careful. It was -- even in midtown Manhattan it was dangerous. Walking through Times Square was dangerous, and there were lots of other places in the city you just wouldn't go because the risk to you physically was so high. You could get robbed, you could get injured, and lots of things could happen -- mugged. And so watching it from the '70s and then through the '80s and then the '90s and where we are now, I mean if you look at New York City's population, from 1975 into the mid-1980s we actually had a million people move out of the city, which is not good when you're trying to provide services for people that live here. When you lose that kind of a tax base, it was devastating.
And then it was really starting in the 1990s where there was an increased focus on security and trying to make sure the streets were safe, improvements around the streets being clean. And that really started to turn the tide about how New York was positioned. And today we're at the largest population that we've ever had in New York City, almost 8.4 million people. And just given natural population growth and what we want to do to expand our competitive position, we need to be able to build enough additional capacity to accommodate people for them to be able to live, work and play here, but also for them to be able to get around. And I think also key to that is maintaining the quality of life gains that we've made. So New York City is the safest big city in the country; crime rates have gone down dramatically every year that we've been in office. The streets are clean now. There's been a huge investment that's been made in terms of the education and improving our public schools, so people feel comfortable living here, and now there's a place where they can raise their families here. And it's really important, particularly in an economy like we have now, that we -- we cannot go back and lose the ground that we've made in terms of the gains that have been made over the past decade or two in terms of really improving the quality of life.
Question: Do you see crime becoming an issue in the coming years as a result of the economic downturn?
Bob Lieber: Well, surprisingly -- I think, again, when we look at the things that we have to do around the city, we've already made a number of budget cuts the last two years. The cuts that are taking place in the uniformed services, particularly with police, and with education have not been as dramatic as it has been in the other agencies. Again, we can't lose the ground that we have there. But it's interesting: when you look at New York City today, the labor force that we have in New York is as high as it's ever been. Typically what you see in recessions or downturns is that people will leave the city. It's too hard to get a job there; it's too expensive to live there. But we have a very aggressive affordable housing program to build 165,000 -- restore or build 165,000 units. We're more than halfway through that already. And what we've seen is, kind of counter intuitively, that we are picking up people who are coming to New York City from other parts of the country because they think the opportunities to find employment are better here than where they are. And they recognize that this is a place that's safe, and they recognize this is a place where they can move and raise a family. So we're over four million people now in the labor force, and I think that's a testimony to the progress that the city's made.
Question: Will the supposed end of the Wall Street era change New York City’s personality?
Bob Lieber: Well, I think that when you look at the contribution that the financial services sector make to New York City, it's disproportionate economics for the number of people who work here. About less than 10 percent of the private employment in the city comes from the financial services sector, but in 2007, peak time, and the Wall Street represented about 35 percent of our payroll tax. So a disproportionate contribution. We don't want to lose that profile. We don't want to lose our role as the financial capital of the world. But what we do want to do is, we want to continue to look for ways that we can diversify our economic environment here and the industries that are in the city so that we're positioned to have businesses that are countercyclical or can absorb people that are getting laid off, or other economic downturns in other parts of the businesses. So I think New York's role as financial capital of the world is probably greater today than it was three years ago, compared to London and some of the other places, and even in Asia, and we still have a very meaningful and important role in that. But when we look at what we're also trying to do to diversify our economy and capitalize on what we think are our natural advantages -- and that's really people, right? -- now it's not shipping, it's not transportation. New York's competitive advantage today is the people who live here and that work here.
So we're looking to try and grow our life sciences and biosciences industry. We're looking to improve and increase our role around the fashion industry. We're still the number one tourist destination in the country. And what we're doing around the green sector and green jobs -- a bit amorphous about what exactly those jobs are. They're all important opportunities for us. Even niche manufacturing and industrial activities, along with technology, along with the tremendous migration that's taking place from traditional media to digital media. I mean, the fact that we're doing this interview now in this format as opposed to writing it down for a story kind of signals how much change is taking place. We want to make sure that we're the place where the best and the brightest want to be, where they want to be with other people likeminded about it, so that we have the ability to grow the job base here, to create more jobs and to expand the tax base so we can provide more services for the residents who live here.
Question: What will New York City look like 20 years from now?
Bob Lieber: Well, I think what you're going to see is an increasing focus for people to live in denser urban environments. When you look at the impact on the environment, dense urban areas have a significant advantage in terms of the contribution to the environment. So I think our PlaNYC initiative to create a more sustainable New York City by 2030, 20 years from now, will reduce the carbon footprint of the city by over 30 percent; that's our goal. I think that's going to have a meaningful impact, so I think you're going to have -- you'll see improvements in what takes place in the buildings, but I think you're also going to see improvements in the way transportation takes place. I think transportation is a big issue for the city going forward. We have to find ways to get people around more efficiently. We have to rely more on mass transit. We need cooperation and help from other parts of the government sector to help us do that. And then I think we continually need to focus on the quality of our air, quality of our water, and our sources of power and energy that are coming in the city as well. So I think those are all really important parts, and we've tried to address that in our PlaNYC initiative, which is 127 separate initiatives that are in place to try and prepare ourselves for the next 20 years.
Question: What other U.S. cities can we learn from?
Bob Lieber: I've always loved San Francisco. I've looked at San Francisco and Denver both as cities if I ever left New York, where would I go? Those are great cities. It's interesting, though: when you go there, particularly San Francisco, and you see what's going on in California today, there are a lot of people in California and in San Francisco who want to get out of there because the quality of life and the costs of operating and living there have gotten so extraordinary. I mean, we -- the budget deficit and what's going on there is obvious.
We can learn things from San Francisco as well. I mean, looking at what San Francisco has done around the water, for example, and how they use ferries, and after the tragedy of the 1989 earthquake, when the Embarcadero freeway came down, and how that's reopened up all the waterfront and reconnected the people in the city to the waterfront and how they use the ferry service to Tiburon and the East Bay, et cetera, I think are all great examples. It's a spectacular city and a place I'd -- if I were going to move, that would be certainly one of the ones I'd consider.
Question: Why Denver?
Bob Lieber: Mountains. The Rocky Mountains and the natural component of that, the skiing, the things you can do in the summer, it's just -- it's a great place. And I went to college there. It's just the diversity of the economy in Denver is not what it is in New York, obviously, or even what it is in San Francisco. But it's a great city. It's a great place; great people. So another great place. There are lots of great cities in the country. I grew up in L.A. It probably doesn't register quite as high to me today as it did, but -- no, they're are great places.
Question: What’s your favorite spot in New York City?
Bob Lieber: I guess my favorite spot is Central Park. There's so much going on there all the time. It's such a kind of a melting pot of all different people. There's always stuff that's happening. I live nearby, so it's easy to get there. But to think about what Central Park was like back in the '70s and '80s, it was not a hospitable place. It's not the place you wanted to go. You'd never go in there when it was dark. But now it's terrific, and I think what the public sector's done, what the private sector's done, with the Central Park Conservancy and other parts to really energize and program it, it's just a spectacular resource for New York City, and there's so many different things to do. I run through there, not every day but often, and -- probably a bit of a creature of habit -- but every time I run through there, there's still new stuff that I haven't seen or haven't noticed before, and I just think it's a great asset for what we have in the city.
Question: What’s the next up-and-coming area of the city?
Bob Lieber: Well, I think that when you think about the opportunities in the future -- I don't know what you want to define as a hot area per se -- but I think when we look at the areas where we're going to see growth, I think it's not going to be in midtown Manhattan. There's already enough going on here. Other than what's going on the future in Hudson Yards, I think other really hot areas are Brooklyn, Greenpoint-Williamsburg, Long Island City. I think both of those areas have seen a lot of investment and a lot of activity, and I really think they're poised for significant growth going forward. It's the trendy place for people to live. Folks like you want to live there. There's lots of restaurants; there's plenty of things to do. It's priced a little differently than other parts of the city. So I think those are the hot trendy areas here. But I think -- you look at Staten Island; Staten Island's got some really competitive advantages there as well in terms of the land that they have, and it's a more suburban type of an environment, which is I think very attractive to people, to particularly be that proximate to Manhattan.
But the other borough that I think has got tremendous potential -- and we've seen a huge change -- is what's taking place in the Bronx. There's been over $1.5 billion of private investment that's been made there in terms of what the Yankees and the Steinbrenner family did to build the new Yankee Stadium, the world champion Yankees and other things with Gateway Center and other developments, because the Bronx has got -- it's the poorest Congressional district in the country, so there's a lot of things that can take place. We've had huge success there with affordable housing. And I think that the Bronx is also well poised going forward. I don't think it's in the same time frame. It's not exactly the same place where I described Long Island City or downtown Brooklyn, but I think when you look at these different areas, a lot of it's going to be focused around transportation. So you have terrific mass transit access in downtown Brooklyn, you've got terrific mass transit access in Long Island City, you've got great mass transit access up in Harlem on 125th Street, so -- in the Bronx as well. So where you -- I think those hot areas are going to be defined by where the real -- the best transportation networks are. That's where we're trying to concentrate activity for growth going forward in the city.
Question: What keeps you up at night?
Bob Lieber: I think that figuratively and literally it is trying to plan for the surprises. As I mentioned, it's a tough job because there are so many competing things that are going on all the time. And making sure we communicate, and making sure we plan, that we can make every kind of preparations possible that -- the other night when I literally got up in the middle of the night was because I knew I had five things that had percolated into my head while I was sleeping, and I said, I just need to make sure that this doesn't get away from me, so I wrote them down and then in the morning went back into city hall and talked to my colleagues and said, these are the things we need to focus on. So I think those, in the literal sense, is what keeps me up at night.
I think the more figurative part of what keeps me up at night -- what I think the biggest risk to New York City is -- is that I think our country needs a wakeup call a little bit about how we're positioning. For better or for worse, this is a global economy now. It is a 24/7 market around the world, and it's much more relevant today how the United States fits in with what's going on in Asia, what's going on in Europe -- Eastern Europe, Western Europe -- what's going on in Africa. So I think we need to be more mindful of how the United States presents itself. And one example, I'd say, is that New York City is a city of immigrants. There are over 130 different languages that are spoken in the borough of Queens. I mean, that's unbelievable. But the immigrant population and the opportunity for people to come to New York and to get the chance to start a business, to raise a family and raise their children with great prosperity is something that we can't lose. And I think when you see the partisan politics that are going on right now in Washington, D.C. and even what's going on in Albany, it really threatens not just New York City, but it threatens our entire nation in terms of what we're trying to do. So that's one of those things that it's harder for us to have a direct influence on, it's harder for us to have direct control about. So those are some of the things that may figuratively keep you up at night, because what happens away from what you're doing can have a material impact on how the city is affected by it.
Recorded on November 20, 2009
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