After 9/11: An Overdue Homecoming

Battery Park CityOf the myriad images to emerge from the rubble of September 11, one that didn't get much notice was the moving trucks.

More than 20,000 people were displaced from their homes in the days and weeks after 9/11. A great many would load those trucks, drive off, and never again call Lower Manhattan home.

Bernadette Grey was among them -- or so she thought. A decade later, not only has Grey and her family returned to Battery Park City (pictured above) but so too have droves of new residents.

Since 2001, the residential population of Lower Manhattan has more than doubled, from 22,961 before September 11 to 56,000 today, according to the Downtown Alliance, a nonprofit research and advocacy group. In the span of 10 years, the tragedy that brutalized the area at the start of the decade is now serving as the catalyst for a neighborhood's reinvention.

Living at Ground Zero

ground zeroGrey, who lived within walking distance of the World Trade Center, in Battery Park City, witnessed the first plane strike the North Tower from her apartment window. Within minutes she was on the street, bounding toward P.S. 89, where her children, a girl in first grade and a boy in third, were just settling into morning classes. It was the start of the new school year. As she ran, she remembers thinking, Don't let them see the falling people.

"I was incredibly rattled, and definitely struggling with the post-traumatic stress of it all," she says today. It would be close to a month before she and her two children could return to their Lower Manhattan apartment permanently. And even then, National Guardsmen were posted everywhere, screening traffic in and out of the neighborhood. "Every time it happened, I'd go into a freak-out meltdown," she says, laughing grimly.

After four months of staying at friends' places and hotel rooms for fear of exposing her children to further danger -- air quality was of particular concern -- Grey, like many of her neighbors, made the difficult decision to leave Lower Manhattan. She would spend the next six years living "as far away from Ground Zero as possible" without actually leaving the city -- first on the Upper East Side, and then closer, to the edge of Midtown. But by 2006, tethered by memories of better days, she returned to Battery Park City.

Returning Home

"My kids always wanted to come back," Grey says. "I was the one who resisted."

When Grey first moved into her Battery Park City apartment in the summer of 1999, she found a neighborhood unlike any other in the city. "It was a hidden gem at that point," she says. "It's like the suburbs, but in some ways better, because you don't need a car."

Yet much had changed in the four years since Grey had left the area. For Gary Malin, president of New York-based real estate brokerage CitiHabitats, the biggest shift was away from the perception that the area was "just a daytime place."

"It used to be too quiet on the weekends. Now it's changed dramatically," Malin says, noting that Lower Manhattan has gone from a "second-choice destination" to a top priority for city apartment hunters.

Click here for an at a glance look at the downtown residential market

What spurred the change was an unprecedented effort by the city to reinvigorate the area after the attacks. Liberty Bonds, first issued during World War I to support the Allied troops, were revived after 9/11 to finance major rental developments. An enticing tax exemption known as 421(g) was granted to developers to convert empty office space into residential units, which became the bedrock for dozens of high-end developments. Finally, a residential grant program funded by the Department of Housing and Urban Development totaling $280.5 million (which "swamped" the sums of other residential aid programs) was used to lure people back or to prompt people to stay through 2003, according to a Rand Institute of Civil Justice report.

Hayes and James SladeFor Hayes and James Slade (pictured at left), a married couple who stayed put after the terrorist attacks, the perks were clear. "Everyone living downtown got some money off their rent, and it was pretty significant," says James Slade. The residential grant program offered rent subsidies of up to $12,000 to those who signed a two-year lease to live south of Canal Street by 2003, and others received smaller but still substantial incentives. In the Slades' case, they were able to move to a two-bedroom apartment for the price of a one-bedroom.

But more importantly, Hayes Slade says, their decision to stay was a matter of principle. "Our kids would ask why people held hands when they jumped from buildings," she says. "We thought it would be a good lesson that you stay and work through things, see the rebuilding process."

A Work in Progress

At a recent press conference, New York Mayor Michael Bloomberg heralded the rebuilding efforts in Lower Manhattan as "one of the greatest comeback stories in American history" and pointed out, with typical New York moxie, that the area's population growth over the past 10 years surpassed that of Atlanta, Dallas and Philadelphia combined. True -- but the path ahead remains uncertain.

Without question, the area has undergone tremendous positive change over the past decade, but Lower Manhattan isn't out of the woods yet, says Jonathan Miller, president and CEO of Miller Samuel, a New York appraisal company.

"There's a lot more there than there was 10 years ago [in the area surrounding the World Trade site] -- I don't want to take away from that, but it's still in transition."

downtown manhattan residential real estateAlong with the whirlwind of development that has blown through in the last decade -- led by very large condo conversions -- the downtown market faces far more "shadow inventory" than other parts of the city, Miller points out. Shadow, in this case, refers to unsold units being kept off the market until available units are leased. As the shadow grows, a full recovery for the local market could be delayed further.

Additionally, while the average rents for the area have risen significantly, typically a good indicator for the market, a lot of the uptick is due to the changing residential landscape, not a surge in existing property value. "Price is up because the mix [of properties] reflects larger and more expensive units, not because of an inordinate rate of appreciation" in older units from a decade ago, Miller says.

Of the many dazzling developments to be erected in the last decade, the record-setting "New York By Gehry" building (pictured below) is perhaps the most emblematic of the area's direction. Marketed as the tallest residential building in the Western hemisphere, the 870-foot-tall, 76-story behemoth towers over Lower Manhattan. While the recently opened tower has had brisk leasing activity (400 leased out of a currently available 600, says project manager Susi Yu), the units are pricey even by the Financial District's affluent standards. Two-bedroom units start at $7,400 a month; three-bedrooms start at nearly $15,000.

Moving Up, Moving Out

The sense of pride among residents both new and old is still palpable today, especially in light of the 10th anniversary memorial services. But for a number of longtime residents who stood by their beleaguered neighborhood in the wake of 9/11 -- those who stayed, as well as those who returned -- there may be new reasons to leave the area.

New York by GehryHayes and James Slade, who hunkered down throughout the entire tumultuous rebuilding period, moved out of their Battery Park City apartment in May and purchased a property across town, on the Lower East Side.

"It was cheaper to buy than what we were paying in rent," James Slade says. In 2002, a two-bedroom rental in Wall Street/Battery Park City cost an average $3,456 per month, according to CitiHabitats. In 2010, a two-bedroom in the same area cost $4,001 a month, a nearly 16 percent increase. The city average for a two-bedroom was $3,395. When asked if tenants who stayed in Lower Manhattan over the last decade pay less than newcomers, the couple answered, in unison, with a resounding "no."

For Grey, whose daughter attended P.S. 89 and will soon graduate from Stuyvesant High School, located minutes from Ground Zero, returning to the area was the right move at the time.

"Coming back was a wonderful feeling -- like coming home again," she says. Many of her children's friends, whose families had also left after the attacks, eventually returned.

But as for how much longer Grey plans to stay in Battery Park City, that's to be decided once her youngest graduates high school. Admittedly, the area doesn't have the same neighborhood feel that it once did, she says, and the rents "have gone sky high," to boot. It would seem her journey has come full circle.

"Now there are a lot of moving trucks here again," she says, but this time, it's because people can't afford the rent.

See homes for rent and for sale in Manhattan on AOL Real Estate.

Also see:
Lower Manhattan at a Glance, Then and Now

After 9/11, Seeking Out New Homes
House of the Day: Tribeca Rental With Room to Work, Grow

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.

See more celebrity real estate
Read Full Story

Can't get enough real estate news?

Sign up for Finance Report by AOL and get everything from celebrity homes to renovation tricks delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

Find a home

Powered by Zillow