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March 13, 2006

New York Diamond Industry Debates Planned 47th Street High-Rise

Members of the diamond trade who are tenants of New York City's famed 47th Street diamond district are raising concerns over a developer's plan to build a 30-story global diamond exchange on the block, The New York Times reported on Monday.

Real estate developer and former diamond merchant Gary Barnett is asking Manhattan to subsidize the construction of the building, which would provide new space for jewelry retailers, wholesalers, manufacturers, cutters and industry-associated services such as shippers and banks. On a block of low-lying, older buildings, Barnett told the Times that the building would rival central diamond exchanges such as the ones built in Shanghai, Tel Aviv and Dubai. His plans include modern amenities and high-level security.

Barnett argues that many diamond cutters and polishers have left New York due to competition from less costly diamond cutting centers in China and India, and that a government-supported diamond exchange has the potential to attract new business from overseas and restore the New York diamond district to its former glory.

However, current tenants and district landlords alike are challenging the project, voicing the concern that with all the most prominent businesses moving to the skyscraper — Barnett has allegedly approached organizations from the Diamond Dealers Club to the Gemological Institute of America — that the rest of the block that stretches between Fifth Avenue and the Avenue of the Americas would become a ghost town.

Industry members quoted in the article also say they dispute the idea that the city might offer financial incentives to one building owner rather than spreading the wealth to the entire block, thus benefiting the wider industry.

If approved, the project, which will involve demolishing 10 smaller buildings in the middle of the blocks of the south side of 47th Street and the north side of 46th Street, is scheduled to break ground in early summer 2006.



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