Lina Khan Wants NYC's Development Agency to Stop Playing to Big Corporations. What Builders and Founders Should Watch

NEW YORK — The New York City Economic Development Corporation, the city agency that manages public land, waterfront property and big development deals, has a new kind of leader at the top of its board. And she is saying out loud that she wants it to work differently.

Speaking at the New York City Policy Forum Convening on Monday, EDC board chair Lina Khan described what she sees as the agency’s old playbook. “One criticism that we heard about how we have approached economic development in New York City for many decades is that there has been almost a trickle-down theory where the assumption has been that the best way to promote growth is to cater to the interests of the wealthiest, most powerful corporations,” she said, according to The Real Deal. “In practice, that has looked like a bias toward more luxury projects, where they focus on consultants and privatization rather than building more in-house state capacity and oftentimes leaving a lot of leverage on the table.”

For developers who partner with the city and the small businesses that fill the ground floors of what gets built, it’s worth paying attention to.

Who Is Running EDC Now

Mayor Zohran Mamdani named Khan board chair in July, when he also appointed Anthony Shorris, a former first deputy mayor, as EDC’s president and CEO. Khan chaired the Federal Trade Commission from June 2021 to January 2025, and the city’s announcement highlighted her work on noncompete clauses and on “challenging monopolistic practices that squeeze start-ups and small businesses.” She is now an associate professor at Columbia Law School.

Shorris runs the agency day to day. Khan’s board role sets direction, which is why her public framing matters.

The Model: A Quantum Lab Where the City Gets a Cut

As an example of the new approach, Khan pointed to a deal announced earlier this month, according to The Real Deal.

On Oct. 14, the city announced $29.2 million for a Quantum Fabrication Facility at New York University, called QFab. NYU is adding $255 million over construction and 10 years of operations, for about $284 million in total. The lab will give researchers, startups and established companies access to specialized equipment for building and testing quantum devices. The city expects it to support more than 100 companies.

The unusual part is what the city gets back. When intellectual property is created at QFab using city-funded tools, the city receives 15% of NYU’s central-administration proceeds from it, including equity, royalties, milestone payments and licenses. The city also gets three seats on QFab’s executive advisory board. amNewYork reported that the lab is expected to open in 2030 at 770 Broadway in Manhattan, and that city officials described the revenue share as a first for New York City.

What It Could Mean for Development Deals

Khan didn’t announce new rules on Monday, and EDC hasn’t published a new policy. So any read on future deals is an educated guess. Still, her remarks and the QFab deal point to a few things the industry should expect to hear more about:

• More strings on public money. If the city wants “leverage” and a share of the upside, developers and institutions seeking city land, subsidies or capital may face more asks in return, such as revenue shares, community commitments or advisory seats.
• Less appetite for luxury-led projects. Khan specifically criticized “a bias toward more luxury projects.” Proposals for EDC sites that lead with high-end residential or retail may face a harder sell than ones built around jobs, industry or affordability.
• More work done in-house. Her comment about relying on consultants and privatization suggests EDC may try to build more of its own capacity. That could change who wins planning and advisory work.

Khan also tied the shift to who officials listen to. “In these types of roles, you can very quickly enter a situation where your surround sound is overly indexed toward the most powerful, well-connected interests,” she said, according to The Real Deal.

What It Could Mean for Small Businesses and Founders

For small businesses, the opportunity is access. An agency that says it wants to hear beyond its usual circle is an agency worth showing up to. Watch for public hearings and requests for proposals on EDC sites in your neighborhood, and for programs tied to industrial and maker space.

For startups, QFab is the clearest signal. City-backed facilities could open up expensive equipment to young companies that could never buy it themselves. But founders should read the terms of any city-funded program closely. The QFab revenue share applies to NYU’s proceeds, but similar ideas could show up in future deals.

The Open Question

The Real Deal’s Ben Miller asked readers the obvious question: is EDC’s work actually changing, or is the language just new? That’s the right test. The answer will come in the next few EDC deals, in what the city asks for and what developers agree to give.

Entrepreneurs Of New York is an independent publication and is not affiliated with NYCEDC.