No Land Grab

When Anne Whitman saw Columbia University's model for its planned campus extension into West Harlem at a community meeting last spring, she was more than a little shocked. The school's first project, and the centerpiece of its proposal, was a building on Broadway and West 129th Street housing a biotechnology research facility. It wasn't Columbia's desire to build a science center in Manhattanville that surprised Ms. Whitman, the owner of moving company Hudson North American, but its location.

"My business is right where their front door is," she says.

The fact that she'd already told Columbia representatives she wasn't selling hadn't deterred the private university from including her property in its plans. That's because the university expects the state to invoke eminent domain to force out any recalcitrant owners to make way for its real estate project. Columbia's uptown expansion, like Forest City Ratner's proposed Nets arena and development in downtown Brooklyn and the massive plans for Manhattan's far West Side, is counting on the broadest interpretation of eminent domain to acquire critical real estate.

But even as these three private developments have thrust the issue into the spotlight, changes are afoot that legal experts and city real estate insiders alike say could undermine those plans. "New York state has expansive eminent domain powers, but there's legal pressure coming from outside the state that could rein in its aggressive use of condemnation in the name of private redevelopment," says Robert Von Ancken, executive managing director of Grubb & Ellis, who has worked with property owners and developers on many eminent domain cases.

A nationwide wave of public opposition and legal criticism has led to several court rulings that have narrowed the prescribed use of eminent domain in some areas of the country. The true test is likely to come in June when the U.S. Supreme Court is expected to rule on an eminent domain case in which the city of New London, Conn., condemned land for a new Pfizer Corp. plant. The decision could have vast repercussions for New York's permissive eminent domain rights.

"The Supreme Court taking the Connecticut case will change the landscape for the abusive and unfair way eminent domain is exercised in New York," says Norman Siegel, former head of the New York Civil Liberties Union, who is representing community groups both in Manhattan and in Brooklyn who are challenging the Columbia and Forest City Ratner projects.

The power of eminent domain, which allows the government to take away privately held property in the name of public use--such as parks, schools or roads--is a state right guaranteed under the "takings clause" of the Fifth Amendment, as long as there is "just compensation." A 1954 Supreme Court ruling broadened the definition of "public good" to include "public benefit," such as when a private project would result in increased tax revenues or job creation.

Both the state and New York City have aggressively taken advantage of the public benefit ruling to clear the way for privately developed megaprojects. Eminent domain was instrumental in building Lincoln Center and more recently in revitalizing Times Square. In the last two years, the state initiated condemnation proceedings to obtain property for The New York Times Co.'s new home in midtown, as well as for the Durst Organization's Bank of America tower on Sixth Avenue. Plans going forward

The city, the state's economic development agencies and the private developers involved would not comment on the likelihood of using eminent domain for the three new projects. However, an attorney who is providing outside counsel to the Empire State Development Corp. claims the pending Supreme Court decision has had no impact on plans to use eminent domain in either the Columbia or Brooklyn developments.

"The Supreme Court's taking the Connecticut case is making people very apprehensive here," he says. "But those projects that are in the pipeline will go forward."

Lawyers disagree as to how broad the Supreme Court's ruling is likely to be and whether it will have an impact on the way New York uses eminent domain. Currently, public agencies in the state have great latitude in interpreting what constitutes blight and therefore most eminent domain actions fall into the category of public good, not public benefit.

"The (three) projects will invoke eminent domain for reasons of blight elimination," says Charles Webb, a partner at Berger & Webb who often represents the state in eminent domain cases. "The question the Supreme Court will consider is narrowly focused on whether eminent domain can be used in the name of economic benefit to the public."

But Robert Goldstein, a partner at Goldstein Goldstein Rikon & Gottlieb, who represents both condemners and condemnees, says the court "might very well expand the scope of its decision to include how states define blight as well."

Noting the pro-private property stances of many Supreme Court justices, Mr. Goldstein believes the court may call for heightened scrutiny at the state judicial level to determine whether the public good is the primary beneficiary in a given eminent domain case.

Opponents of the three major projects, however, aren't sitting idly awaiting the highest court's decision. Instead, they are actively trying to win their case in the court of public opinion. Observers say the toughest battle will be in Brooklyn. Bruce Ratner, the owner of the Nets and the force behind the arena development, is a veteran of eminent domain battles, having weathered opposition to developing MetroTech in Brooklyn with the help of state condemnations.

Strong support Mr. Ratner also has local political support. Borough President Marty Markowitz, who declined interview requests, has spoken strongly in favor of Mr. Ratner's plan and its promise to create new jobs and housing.

Even the local community board chairmen are backing the project, despite local opposition. "We're fighting a real uphill battle here," says Gustave Von Peebles, a local resident whose apartment is in the 13 acres of privately owned property Forrest City wants to demolish.

It's a very different story in Manhattanville, the strip of West Harlem from West 125th to West 133rd streets between Broadway and 12th Avenue that Columbia has earmarked for its new campus. The local business community and politicians are united behind the six holdout property owners, who have organized as the West Harlem Business Group.

"Columbia must pledge not to use eminent domain against the West Harlem Business Group if it wants the support of the Harlem business community," says Marita Dunn, chairwoman of the Manhattan Area Community, a group of 50 Harlem businesses.

The local community board voted 29-0 to oppose the use of eminent domain, and Manhattan Borough President C. Virginia Fields, who is trying to bring the two sides together to broker a compromise, says, "Columbia and the state need to publicly say that eminent domain is off the table." University officials have said that invoking eminent domain would be a last resort and there have been indications that Columbia's architects are working on an alternative plan that might allow existing businesses to remain. "I'll be surprised if some sort of compromise isn't worked out," says the attorney working with the ESDC.

It's unclear how effective opposition will be in the area affected by the proposed development of Manhattan's far West Side. The political muscle behind the plan from both Albany and City Hall is considerable and will only grow, should New York win the bid for the 2012 Olympic Games.

Ms. Fields, however, intends to weigh in on the side of the owners threatened by the condemnations. Federal Express, which has spent more than $50 million on a building it leases in the area, has announced its intention to fight any eminent domain action.