Sunnyside Yards and the Errors of Pro-Growth Progressivism

Happy Tuesday, and welcome to another edition of Rent Free. This week’s newsletter includes stories on:

• Two New Jersey property owners successfully fend off an effort by Perth Amboy to seize their properties on bogus blight allegations.
• A ban on corporate home purchases is slipped into Congress’ bipartisan housing legislation.
• The true cost of permitting delays

But first, this week’s lead item focuses on New York City Mayor Zohran Mamdani’s revival of the Sunnyside Yards megadevelopment. Many of the city’s progressives used to hate this project. Now they love it.

That reveals an interesting change among progressives. Once, they were reflexive NIMBYs. Now they can’t get enough of growth. Nevertheless, both attitudes assume that the government needs to be deeply involved in planning a city’s growth.

On Thursday, New York City Mayor Zohran Mamdani had yet another meeting with President Donald Trump in which the mayor, per his own communications staff, successfully pitched the president on sinking massive sums of federal money into an affordable housing development that’s to be built atop the Sunnyside Yards rail facility in Queens.

“The president was interested in the idea and I look forward to the ensuing conversations about how to build more housing in a city that doesn’t have enough of it,” said Mamdani at a Brooklyn event, per The City.

He also left the White House with this photo of Trump holding a fake Daily News headline about him telling the city to build.

I had a productive meeting with President Trump this afternoon.

I’m looking forward to building more housing in New York City. pic.twitter.com/XnPbt0KXYU

— Mayor Zohran Kwame Mamdani (@NYCMayor) February 26, 2026

Mamdani is seeking $21 billion in federal grants to deck over the 180-acre Sunnyside Yards site in order to build 12,000 units of affordable housing, plus parks, schools, and health clinics, on top of it.

The White House itself hasn’t offered any comment on federal support for the Sunnyside Yards project. The kind of commitment Mamdani is seeking would require a lot more than a single conversation. It is notable that neither Trump nor any White House spokespeople have felt the need to contradict Mamdani or distance themselves from the Sunnyside project either.

The idea of decking over and developing Sunnyside Yards is not original to this New York City mayor. Conversations about it have been ongoing for more than a century.

The most recent efforts to build neighborhoods on top of it began in earnest in 2014, when Amtrak—which owns most of the site—approached the city about a joint redevelopment project.

A 2017 feasibility study produced by the city called for building as many as 24,000 units atop the site, a third of which would be below-market-rate affordable units, for an estimated total cost of $16 billion to 19 billion.

A 2020 masterplan, with the unfortunate release date of March 2020, proposed a more modest 12,000 units, all of which would be below-market-rate units reserved for very low-income New Yorkers.

The pandemic sapped attention and will to do any sort of urban megadevelopment. But with a new mayor with grand visions about City Hall doing great and spectacular things, the project is being considered in earnest again.

While Trump’s potential interest in the project is eye-catching, the real political story seems to be how much progressive New York politicians have warmed to the idea of a massive residential development at Sunnyside Yards.

When the city was preparing its last Sunnyside Yards feasibility study (which had the bad luck of being released in early 2020), Rep. Alexandria Ocasio-Cortez (D–N.Y.) (whose district then included the site) blasted the redevelopment proposal.

“The proposed high-rise and mid-rise residential buildings would further exacerbate a housing crisis that displaces communities of color and parcels off public land to private real estate developers,” wrote Ocasio-Cortez and then-City Councilmember Jimmy Van Bramer in a letter to the city’s Economic Development Corporation, which was authoring the study.

Today, Ocasio-Cortez is expressing support for a Sunnyside Yards redevelopment, calling it, through a spokesperson, “transformational”, per The New York Times.

“The political climate in New York City in 2026 is light years away from the political climate when we last visited this,” Van Bramer told City & State.

One might see this as a victory for an “abundance” or YIMBY (“yes in my backyard”) mindset on New York’s progressive left. The reflexive belief that building anything is just a neoliberal plot has given way to a desire to restart the city’s growth machine.

Unfortunately, progressives’ pro-growth conversion is leading them from one urban policy error to another.

If before, everyone was too opposed to growth and development, now they’re looking much too kindly on what is a massive boondoggle proposal for the redevelopment of Sunnyside Yards.

That aforementioned 2017 feasibility study made clear that the value of the developable land created by decking over the railyard was dwarfed by the cost of building the deck and related infrastructure.

It just doesn’t pay to construct expensive new developable land atop a working railyard when the city already has lots of existing land that could be developed instead.

Rezoning industrial and commercial properties to allow housing or upzoning existing residential land to allow for more housing is a far cheaper and easier project than building a $21 billion deck.

That would be true at any time with just about any proposal. But Mamdani seems committed to taking a project with a bad return on investment and making it worse.

The 2017 feasibility study proposed a 24,000-unit residential scenario that would include some 7,500 affordable units. Mamdani wants to build all the same infrastructure to support a smaller 12,000-unit project that’s 100 percent affordable—meaning every unit will require some public subsidy.

It’s not like New York City has money to burn either at the moment.

Just a few weeks ago, Mamdani was saying massive property tax increases were necessary to cover the city’s budget gap while avoiding spending cuts. Absent belt-tightening at City Hall, New York’s fiscal situation is likely to get worse in the coming years, too.

Adding a giant money-losing redevelopment project to the budget seems like a bad idea.

Obviously, Mamdani is hoping that Trump and the federal government will pick up most of the tab.

Who knows, maybe Trump and Congress will agree to fund the project.

If that’s the only way to make Sunnyside Yards pencil, however, New York’s progressives should think long and hard about whether they want their premier housing development to be dependent on the whims of a federal executive they find dangerous and authoritarian in every other context.

As Van Bramer told City State, Mamdani has “still got to get the $21 billion from the fascist, white supremist in chief, but Zohran is trying to do big things here.”

If that’s how one thinks of the president, then you’d assume you’d want the federal government to have as little fiscal leverage over the city as possible.

Yesterday’s progressive NIMBYs thought that the government needed to carefully plan and design cities’ growth and that there shouldn’t be that much growth. Today’s progressive YIMBYs seem to think that there should be a lot of growth and the government should plan and design it.

Both worldviews fail to appreciate what self-organizing animals cities really are.

Mamdani has said plenty of positive things about the need to cut back regulations and let the private market build housing. If he were to stick to red-tape-cutting initiatives, he could get a lot more housing at no public expense while also avoiding any additional fiscal dependency on an archpolitical foe.

That seems like a better deal.

Yesterday, New Jersey Superior Court Judge Benjamin Bucca ruled in favor of two property owners, Honey Meerzon and Luis Romero, who’d sued Perth Amboy, New Jersey, to stop the city’s seizure of their properties.

New Jersey’s Local Redevelopment and Housing Law allows municipalities to take properties if they can show that they are blighted, undevelopable hazards.

Bucca agreed with Meerzon and Romero’s contention in their lawsuit that their respective apartment building and tire shop were not blighted and that the city’s claims contending otherwise rested on “speculative assertions, generalized concerns, and incomplete or unreliable evidence.” His order vacates a city resolution authorizing the taking of Meerzon and Romero’s property.

“My first reaction when our lawyers called us was screaming,” Meerzon says about hearing the news that the court had ruled in her and her co-plaintiff’s favor. “I didn’t know how this was going to go.”

Reason first covered Meerzon and Romero’s case back in May 2025, shortly after the Perth Amboy city council had voted to declare both properties blighted and “in need of redevelopment”—a designation that enables the city to eminent domain the land.

The city’s evidence of blight was always quite thin. Perth Amboy asserted that incidental litter and stray cats in the rear of the properties and police traffic stops on the street in front of them made the properties blighted.

A consultant the two owners hired also offered credible evidence that the city had wrongly mapped the property lines, meaning the litter and stray cats were actually on Perth Amboy–owned land.

Meerzon said her and Romero’s properties were actually being seized as part of a massive warehouse redevelopment project underway on adjacent land to the south of their properties.

In June, Meerzon and Romero sued Perth Amboy in New Jersey state court to stop the seizure.

“A ruling in the favor of the city would have blessed any blight determination based on any criteria,” says Bobbi Taylor, an attorney with the Institute for Justice, a public-interest law firm, which represented Meerzon and Romero.

Bucca’s opinion reaffirmed recent New Jersey Supreme Court rulings tightening the evidence municipalities need to show in order to prove blight and take property for redevelopment purposes, she says.

The city has 45 days in which to appeal Bucca’s ruling. But for now, Meerzon and Romero’s properties are safe. Taylor says that Meerzon’s tenants can stay put and Romero’s employees can keep their jobs.

During his State of the Union address to Congress last week, President Trump reiterated his desire to prohibit larger investors from purchasing additional single-family homes and called on lawmakers to make that happen.

They just might.

Over the past year, two substantially similar housing bills, the Senate’s ROAD to Housing Act and the House’s 21st Century Housing Act, have both managed to pass their respective chambers with overwhelming bipartisan support.

Yesterday, Sens. Elizabeth Warren (D–Mass.) and Tim Scott—the primary authors of the Senate bill—released compromise legislation that combines the two bills and which they hope will be a vehicle for passing both into law.

The new amalgam legislation includes a prohibition on “large institutional investors”—defined as entities that own 350 homes or more—from purchasing additional single-family homes.

Build-to-rent communities are exempt from the ban, which would greatly limit its impact on new homes being built.

Still, it’s unfortunate to see federal housing legislation that’s largely comprised of wonky, modest policy tweaks and more than a few pro-supply policies weighed down with this moral panic–inspired ban on corporate home ownership.

As Reason has covered previously, large institutional investors are responsible for a tiny fraction of new home purchases. Investors of all sizes have generally been selling off their single-family rentals to owner-occupiers for the past decade.

While a small slice of the market, these corporate buyers nevertheless provide some modest benefits. There’s evidence that they helped stabilize home prices in the wake of the Great Recession. They also provide single-family rental options to home seekers who either can’t get a mortgage or don’t want one.

Prohibiting large investor purchases would deprive renters of some housing options. They also raise the risk that Congress will go searching for the next housing boogeyman instead.

Economists Evan Soltas and Johnathan Gruber have a new working paper making the rounds that attempts to measure the costs of the permitting process in Los Angeles.

They find that developers are willing to pay a 50 percent premium for land that has already been preapproved for new construction. They use that finding to estimate that the permitting process is responsible for one-third of the gap between home prices and construction costs.

In a famous 2003 paper, economists Edward Glaeser and Joseph Gyourko found that in most of the country, the price of housing was pretty close to the costs of new construction. The places with the highest home costs were also places where housing prices far outstripped construction costs. The gap between the two could be explained by excessive land use regulation.

Soltas and Gruber’s paper would build on this finding for Los Angeles. It suggests that getting permission to build makes up one-third of the costs of land use regulation. That’s a lot of money to pay for some paperwork requirements.

• The American Enterprise Institute has released a very helpful guide to the numerous state zoning reform bills that have been introduced around the country, along with estimates of how many units each bill might produce if enacted.
• The California Chamber of Commerce is collecting signatures for a ballot initiative that would sustainably scale back California’s Environmental Quality Act, which has been known to add years to the time it takes to complete new infrastructure and new housing.
• Other publications might be missing the property tax revolts sweeping the country, but not Reason!

An issue only coveted by obscure specialty magazines…and Reason! https://t.co/NHXH0L5xrQ pic.twitter.com/s1d1Q3V7xF

— Christian Britschgi (@christianbrits) March 2, 2026