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Old 08-09-2008   #4
superbeautiful
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“It’s an older business model. But it’s a business model that’s needed for creating luxury products and luxury goods,” he said.

Standing beneath a red, white and blue bow that decorates his office door at R&C Apparel Corp. at 344 West 38th Street, Ramdat Harihar, president and chief executive officer, said, “This is the heart of the industry,” as he surveyed 26 workers at work. R&C, which does special handwork for 100 companies, including Anna Sui, Vera Wang, Zac Posen, Lepore and others, faced a 5 percent rent increase this year. Relocating to another building was an unwanted headache, since it would cost $20,000 just to move the boiler that is needed to fire up the machine used for hand-pleating. So Harihar scaled back his space from an entire floor of 8,000 square feet to 4,500 square feet. Hundreds of old machines are piled up in the already cramped work space, as well as in his office. His landlord told him he planned to use the leftover space for storage, “but it’s still empty,” Harihar said.

During a visit last month, one staffer was hand-sewing scraps of fabric together to make belt loops instead of using uncut pieces on an automatic sewing machine. “We have to help him out. He doesn’t have enough fabric,” Harihar said, referring to the client.

He also feels obliged to give up-and-comers a helping hand. “Young designers need a lot of assistance to be better designers or production managers. A lot of them are willing to stay here because the quality is so different,” he said. “I have been encouraging them to go and use the Made in New York or Made in the USA label.”

When New Dynasty owner Amy Koo’s rent jumped 50 percent this year, she still renewed her lease at 307 West 38th Street, even though a 7 percent increase had been the norm in recent years. But she inked a two-year lease to avoid another hike next year. Had she asked why there was such a drastic increase? “I didn’t say anything. [You don’t], if you want to continue.”

She and her 30-person staff are “working harder,” and are taking on more overtime to try to offset the cost. Lepore, whom she first started making clothes for 18 years ago, is trying to help New Dynasty by paying a little more per garment on second runs, Koo said.

Encouraging small designers or new ones to do small runs in her factory is one tactic. “I’m trying to get them to do their production here first. I hope everybody has this mentality,” Koo said.

Karen Erickson of Erickson Beamon has produced out of New York City and Belgravia in London. “For me, it adds to the intrinsic value of what we do,” said Erickson. “It means so much to know the name of the person who made each piece. It makes it have a soul and a heart.”

Last year, after nearly 25 years at 498 Seventh Avenue, Erickson was unable to renew her lease. “After all those years, my landlord said no, and I was forced to leave the garment center,” said Erickson, who moved operations, and Showroom Seven, which she also owns, to 11th Avenue in Chelsea. “They had no interest in renewing my lease because they were renting it to a big British p.r. company,” said Erickson. “And with their strong pound and our weak dollar, they could pay $75 a square foot.”

Erickson traces the change in garment center mentality back to Sept. 11, 2001. “After 9/11, Oppenheimer Funds wanted to maintain a low profile,” she recalled. “They didn’t want to be in such a visible place where they could be damaged or hurt, so they came and took six floors in my building, and paid an outrageous amount of rent. They ended up leaving because they couldn’t stand the garment center, how unslick it is.”

Still, the new market rate was set. Erickson’s perfectly happy with her space on the West Side, but she’s wary of the future. “We need some sort of protection,” she said. “What makes New York great is the fact that there is a garment center, and there is a fashion industry. If they only cater to real estate people and don’t offer any sort of protection, what’s going to happen in 10 years when my lease is up here?”

At 240 West 37th Street, the main lobby has been closed for renovations for several months — something some say is becoming increasingly more common as owners try to attract higher-paying renters and nudge out tenants. Visitors must enter through the run-down freight entrance, where a security guard tracks visitors and ensures the building is empty by 8 p.m. The guard, who declined to give his name, said if anyone walks past him without showing an ID, he has been instructed to call the police to have them arrested for trespassing. Tenants will be out by the end of the year, he said.

Last summer, developer Isaac Chetrit bought the 131,900-square-foot building for $43 million. Around that time he also bought a nearby 21-story Sixth Avenue building for $49 million. The Chetrit family is said to own The Toy Building as well as a stake in the Sears Tower in Chicago. Chetrit could not be reached for comment.

As factory workers wheeled out sewing machines with the pallor of pallbearers, one displaced worker, who requested anonymity, said, “From their point of view, I understand they want to invest in their commercial real estate to see a better return on their investment. But from the tenants’ point of view, we are being squeaked out to the outer boroughs. The way things are going, we will be phased out to a one- or two-block area.”

In addition, sewing machines and other equipment, much of which has been used by the same sets of hands for decades, is being sold at dirt cheap prices. Many companies are selling their old sewing machines for as little as $100 and the buyers often flip them on eBay for $800 or $900, he said.

Teng, Wainwright and others claimed the city is not enforcing the existing zoning, with many landlords already renting to nonapparel companies. “If we cannot enforce what is the law right now with the one-to-one ratio, what leads you to believe any other proposals will actually come to life?” Teng asked of the rule that requires the neighborhood’s space to be divided equally between manufacturing and nonmanufacturing. “But I am willing to entertain whatever the city proposes. Mayor Bloomberg has been very supportive of the industry and the EDC has been researching how to sustain the fashion industry since 2006.”

The fact that the fashion industry is New York City’s second largest employer spurs her on. And the diversity it provides is essential to New York’s culture, Teng said. Creating an online directory of apparel-related businesses is an initiative she has suggested.

Randall said, “If these factories are so critical to New York City, why don’t these designers agree to give them 20 percent of their production? Designers would tell you they could never be competitive if they produced in New York City.

“It’s all trickle down. Consumers pressure retailers [for markdowns,] retailers pressure designers, designers pressure contractors, which is why there is no one simple answer.”

Jeanette Nostra is president of G-III Apparel Group Ltd., a $730 million operation by Wall Street estimates. “When I began in this business 33 years ago, I couldn’t walk down the sidewalk from my loft at 36th and Ninth to my office at 37th and Seventh without dodging racks of clothes, and having the truckers chirp me as I walked by. There was a vibe, a real camaraderie. That’s gone. That manufacturing is not coming back here. We need to revitalize the area. What would be wonderful would be for the city to make it easy for the buyers who come here from across the country by having more restaurants and boutique hotels. During market week, there could be transportation to and from the Javits Center and the Piers from the garment center.”

Perhaps no one is more excited about the prospect of preserving the area than small business owner Samantha Cortes, who organized a group that first handed out Save the Garment Center pins 18 months ago. A 35 percent rent hike for her 242 West 38th Street offices motivated her to take action. Asking designers to maintain a small percentage of their production in the U.S. and promoting New York-made goods in a more organized way are a few of the ideas she has discussed with city officials, but to no avail, she said.

Encouraged as she is by the latest developments, Cortes said, “From proposal to action is going to be a long step.”