by Ronald Drenger

The City Planning Commission made no one happy on March 5 when they approved a change in zoning regulations for the South Street Seaport neighborhood.

By setting the height limit at 170 feet—about 17 stories—the commission angered Community Board 1, which wanted a 120-foot heigh limit, and Milstein Properties, which owns 250 Water Street, the development site most affected by the rezoning. Milstein proposes a residential complex with 13- and 24-story towers.

The zoning change now goes to the City Council and both sides are lobbying the Council and fighting to get the measure modified before it is voted into law.

Community Board leaders, who worked with the Department of City Planning for two years to prepare the rezoning proposal, said they were deeply disappointed that the commission modified building-height limit.

“A 170-foot-tall building is not appropriate for the Seaport historic district,” said Paul Goldstein, CB1’s district manager. “It’s out of scale with the historic buildings in the area.”

The community board wants to make sure that no high-rise building is constructed within the 10-block Seaport historic district, bounded by Fulton, Pearl, Dover and South Streets, which encompases mostly four- and five-story buildings, many from the 19th century. Since acquiring 250 Water Street in 1979, the Milsteins have proposed half a dozen buildings for the site, up to 43 stories tall, that were rejected by the city’s Landmarks Preservation Commission as inappropriate for the historic district.

The 170-foot limit would still block the real estate powerhouse from moving forward with its development plan.

“We’re obviously very disappointed,” George Arzt, a Milstein spokesman, said after the commission’s vote. “We believe that our project would have helped Downtown at a time of rebuilding and would have helped the struggling Seaport area.”

Arzt said that the bulk restrictions under the new zoning “is insupportable for housing” and that 250 Water Street “in all likelihood will remain a parking lot.”

In recent months, the Milsteins had battled against the rezoning plan, trying to convince the commission as well as City Hall that residential development would help Downtown. Milstein executives have also charged that community board’s measure represented inappropriate “spot zoning,” aimed specifically at the 250 Water Street site.