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On November 28, Mayor Michael R. Bloomberg announced milestones in three projects that will bring affordable housing and additional cultural and community space to the last city-owned parcels in the Downtown Brooklyn Cultural District. First, the Gotham Organization and DT Salazar are partnering with City Department of Housing Preservation and Development (HPD) to develop a 515,000-square-foot mixed-use building on a site bounded by Fulton Street, Rockwell Place, and Ashland Place. Second, Two Trees Management Company has initiated the public review and approval process for a 32-story mixed-use facility designed by Enrique Norten of TEN Arquitectos on Flatbush and Lafayette. Finally, HPD released an RFP for the last development parcel in the district, located at the intersection of Ashland Place and Lafayette.
“Downtown Brooklyn has very quickly become one of the city’s most vibrant cultural destinations and an exciting place to live,” said Mayor Bloomberg in a statement. “These projects—which will bring more affordable housing and community space to the neighborhood—are more proof of the confidence that the real estate industry has in New York City and in downtown Brooklyn.”
HPD has finalized plans with the Gotham Organization and DT Salazar to build 600 units of new housing, 50 percent of which will be affordable and 40 percent of the affordable units will be two-bedroom units. When completed, the building will also contain 20,000-square-feet of cultural and related office space and 20,000-square-feet of retail space. HPD and the NYC Housing Development Corporation (HDC) expect to close on financing with the development team late next year and to see construction begin shortly thereafter. The Gotham Organization has not yet announced the architect of the project, which has just begun design development.
Two Trees, which agreed to purchase the district’s South Site parcel from the City’s Economic Development Corporation in 2009, began the City’s Uniform Land Use Review Procedure (ULURP) to gain approval to build a new mixed-use development on the Flatbush Avenue site. The approximately 47,000-square-foot lot, which is bounded by Flatbush, Lafayette Avenue, and Ashland Place, is currently a parking lot owned and operated by the New York City Economic Development Corporation (EDC). Once the ULURP process is complete, and approvals have been granted, Two Trees can begin constructing the Ten Arquitectos highrise, which includes approximately 50,000-square-feet of creative and cultural space that will be shared by BAM, 651 ARTS, and the Brooklyn Public Library. In addition, the tower will include approximately 23,000-square-feet of ground-level retail, as well as approximately 300 to 400 apartments, 20 percent of which will be affordable.
Plans for the site also include a 16,000-square-foot public plaza programmed for a variety of outdoor uses, including dance and theater performances, film presentations, open air markets and crafts fairs, and other community uses.
Once the facility is complete, the 50,000-square-feet of cultural space and a portion of the public plaza will be controlled by the City of New York. Approximately 17,400-square-feet of space will be occupied by BAM to allow the institution to meet the needs of its growing audiences. A component of this expansion will enable the academy to make its BAM Hamm Archives Center resources available to the public, providing researchers, artists, educational institutions, and students with access to materials and records documenting the oldest performing arts center in the country.
The Brooklyn Public Library will use approximately 16,500 square feet of the cultural space to open a new state-of-the-art branch. The new branch will offer traditional library services as well as new technologies and programming that will benefit the local community.
651 ARTS, an acclaimed performing arts presenter dedicated to artists of the African Diaspora, will occupy a 12,500-square-foot studio and rehearsal center. The rehearsal studios will be available at affordable rates, and preference will be given to organizations in the Downtown Brooklyn Cultural District. The state-of-the-art studios will also be multi-purpose space for education programs, and will provide opportunities for live public performances, gatherings, and salons for artists to cultivate their work.
On November 27, HPD released an RFP for Cultural District Site II, the last development parcel in the district, located at the intersection of Ashland Place and Lafayette Avenue. The RFP calls for approximately 100,000 square feet of floor area and may include residential, community, and/or commercial space, with a requirement to include a minimum of 15,000 square feet dedicated to cultural space and the arts. If affordable housing is proposed it must serve low-income New Yorkers. Proposals must be submitted by February 1, 2013. For more information and to download the RFP, visit www.nyc.gov/hpd.
I’m so glad you could make it to my microhousewarming. Ha-ha, no, there’s still going to be a lot of fun, I’m just calling it that because of how much I’m loving my new Kips Bay-area, Bloomberg-administration-ordered, 275-square-foot microapartment. You can put your coat right ... there on your shoulders! Please keep your coat on. One of Gerald’s friends brought a hat, so unfortunately space is a bit tight in the closet.
As the development story of Brooklyn’s Domino Sugar refinery continues to unfold, it appears to have all the flawed heroes, hubris, and possibly catharsis of a real urban drama. The project’s lead, Community Preservation Corporation Resources (CPCR), has lost a top-level leader, defaulted on major loans, and now is being accused of betrayal by a former partner: The Katan Group, CPCR’s development collaborator at Domino, has filed a lawsuit amid reports that CPCR was looking to sell part or all of the 11-acre property without Katan’s knowledge.
CPCR is the for-profit arm of Community Preservation Corporation (CPC), a nonprofit consortium of banks established in 1974 to help fund affordable housing projects in the New York area. Its counterpart, CPCR, was founded in 1992 so that the group could act as a proactive developer as well as an investor. Other affordable housing developers, such as Enterprise Community Partners, operate simultaneously as both nonprofit and for-profit; however, one big difference, said sources familiar with the corporate structure, is that at CPC-CPCR, both its nonprofit and for-profit branches are directed by the same person. Until last November, that was Michael Lappin, who abruptly retired after 31 years with CPC. In January, Lappin’s post was filled by Rafael Cestero, former commissioner of New York’s Department of Housing Preservation and Development.
Cestero will be responsible for addressing Domino’s future as well as the bigger question of whether, given its mission, CPC-CPCR should have been involved with such a project in the first place. Domino’s sheer scale—the plan includes 2,200 units, with 660 set aside for affordable housing—was unprecedented for CPC-CPCR and the aspect of the project that the local community objected to the most. A design by architect Rafael Viñoly and a mandate to work around newly landmarked factory buildings exponentially increased the price tag, and, following the financial crisis, the project simply ran out of cash. Katan Group is now suing CPCR, stating in a March 5 court filing that the lead developer “has effectively depleted all of the refinery’s available capital, while virtually no construction work has been performed.”
But this drawn-out development saga could still have a happy ending, according to Williamsburg Independent People (WIP), a community group with an alternative vision for the site. WIP is seeking financial backing for a plan that creates a mixed-use arts development and promises affordable housing as well as new jobs. Meanwhile, every twist and turn of the development drama has been captured by a documentary team. Megan Sperry, one of the filmmakers of the forthcoming The Domino Effect, said “CPCR has been looking for investors for two years, and now they’re getting desperate.”
Going to the DMV is nobody’s idea of a day at the park, but the emerging field of service design aims to change that. The Brooklyn-based nonprofit Public Policy Lab (PPL) incorporated last year with the goal to improve interactions between public services and those served by them through research, advocacy, and technical assistance.
Explained PPL executive director Chelsea Mauldin, “At the DMV, it’s important to look at how we interact with the created artifacts of that service—the physical space, the forms, the actual driver’s license. There’s a sequence of service steps you encounter.” By studying these interactions, service designers can decipher the strategic goals of public policy and improve efficiencies between the public agencies and their audience, while also saving money.
PPL’s first major initiative is a collaboration with the NYC Department of Housing Preservation and Development (HPD) and Parsons’ new interdisciplinary service design program, the DESIS Lab. Following a scoping meeting in late January, the team will spend a year studying how the agency interacts with its clients—developers, property owners, and residents—to recommend pragmatic and implementable design ideas. “This is an out-of-the-box collaboration,” said Kaye Matheny, the HPD assistant commissioner for strategic planning. “We’ll be evaluating how people engage with HPD—what are our touch points across the city, how do they engage with us, and how do we improve that?” A second phase of the partnership will study the impact of HPD’s providing over $8.7 billion to neighborhoods since 1987. “We want to understand how our investment has shaped and defined neighborhoods,” said Matheny. Achievable recommendations could begin implementation next year.
While service design has long been employed in the private sector, Mauldin believes this approach has broad applications in the public sector. She said service design is picking up where public space design began several decades ago. “At this point, everyone’s just learning. It wasn’t always the case that public spaces needed thought or design,” Matheny said, but now she added, “it’s becoming clear that there is a need.”
As part of a complex deal with the federal Department of Housing and Urban Development, the state, and private groups, 21 of the city's most dilapidated public housing complexes finally became eligible for annual federal subsidies today, as well as an investment of more than $400 million. The deal is one of many helping to keep affordable housing afloat during the downturn, as chronicled in the following story from Issue 05.
Whether it is the past boom or the recent bust, affordable housing seems always to be in urgent demand. During the good times, rent-controlled and rent-stabilized units vaporized, and now sky-high rents have still not come back to earth.
Blame for these developments often falls on the business-friendly Bloomberg administration, but affordable housing advocates and developers argue that, were it not for the mayor's efforts, the city could be in much worse shape. “Their affordable housing plan is one of the foremost in the country,” said Josh Lockwood, executive director of Habitat for Humanity New York City. “It’s pretty amazing that they’re on track in the middle of this recession.”
Lockwood was referring to the New Housing Marketplace plan, updated on February 22. The centerpiece of the Department of Housing Preservation and Development’s affordable housing efforts, the plan was first laid out in 2002, and greatly expanded in 2005 on the eve of the mayor’s first re-election. It called for 165,000 units for some 500,000 residents by 2013, half of which would be created through new construction, often within market-rate developments, half through preservation of existing affordable units.
The mayor announced that the program was indeed on track (with just under 100,000 units so far), but it will now take a slightly different tack, emphasizing retrofits and preservation over construction. In spite of the plan’s continued success, it is not immune to the current economy: Keeping it afloat will cost the city an additional $1 billion, and the completion date has been pushed back to 2014.
Holly Leicht, Deputy Commissioner for Development at HPD, sees these changes as a virtue, not a failure. The city initially capitalized on new construction, leveraging inclusionary zoning and tax credits to entice developers to build in affordable units to their new "luxury" projects. With construction credit still frozen, almost no units are being created through this route, so the department has shifted its money to the other half of the equation, preserving units through tax credits and low-interest loans.
“A lot of owners, particularly in Mitchell Llama housing, may have seen a pot of gold before, but now that pot of gold is gone, and they are much more interested in talking to us,” Leicht said. This is an especially enticing approach for the department because it has already committed heavily to such developments. Keeping them affordable now extends that investment. It also has a faster turn around than new construction, where many promised units remain unbuilt. “It’s taking longer, but we always anticipated this would be a long-term strategy,” she said. Still, Leicht said she believes the worst is over, and the department still managed to realize 12,500 affordable units last year, down from a high of 17,500 in 2008.
New programs have also sprung up to help the city in its quest for more affordable housing, though they are experiencing varying degrees of success. The city has received two rounds of Neighborhood Stabilization Program funding from the federal government, which uses innovative data-tracking to fund small-scale projects, from homeownership assistance to foreclosure purchasing, helping head off the sort of disinvestment that plagued the city in the 1970s and ‘80s.
One program that has yet to bear fruit, however, is one of the most celebrated, at least by the politicians who created it. With upwards of 600 stalled construction projects in the city, City Council Speaker Christine Quinn proposed the Housing Asset Renewal Program, or HARP. The program, announced last summer, would use city money to provide bridge loans to stalled projects, with $25,000 to $50,000 provided for each unit the developer converted to affordable housing. The goal was to create about 400 affordable units.
So far, none have gone ahead. A deadline was originally set for December, but it was pushed back to April for lack of quality bids. Leicht said there are better offers coming in now, with more variety—not just small projects in the outer boroughs. The problem remains that few lenders, even with foreclosures in the offing, are willing to take the necessary discounts the program demands.
“It’s a great idea,” said Jerilyn Perine, executive director of the Citizens Housing and Planning Council, a local nonprofit research organization. “Ironically, because people are optimistic about our future here in New York, they aren’t willing to take a hit yet on their investment.”
As with most problems since the collapse, blame has fallen on the bankers. James Riso, a principal at affordable housing developer the Briarwood Organization, said he used to close two to three apartments a day in his projects but is now lucky to see that many a month. Meanwhile, most developers are holding on, so competition remains fierce for the few affordable ground-up projects out there, forcing Briarwood to do more construction management, which is actually where the developer has it’s roots. “We’ve come full-circle,” Riso said."You have to adapt to your circumstances."
Habitat for Humanity has, it has actually been prospering. It recently partnered with New York State to develop super low-interest mortgages for homeowners. With the proceeds, Habitat is now able to take out construction loans for the first time, expanding its building program. The group has also been negotiating short sales to keep buildings occupied and using its volunteers to clean up community centers and parks, making distressed neighborhoods less so. “Now’s the time to get creative,” Lockwood said.
After decades of neglect and an epic community battle, the 31-acre swath of north Brooklyn known as the Broadway Triangle may finally be taking shape. At a hearing today before the City Council’s land-use committee, councilmember Diana Reyna—whose district borders but does not include the Triangle—came within one vote of convincing her colleagues to scuttle a long-simmering plan to rezone the area. But with the plan’s passage by a vote of 12–6, the rezoning will likely succeed on Wednesday, when it goes before the full council for a vote.
The city’s Department of Housing Preservation and Development took the lead on rezoning the Triangle, as it controls a number of city-owned sites that will be turned into affordable housing when the plan goes through. Those sites, however, have become a flashpoint for the plan, as two politically connected groups, the United Jewish Organizations of Williamsburg and Ridgewood Bushwick Senior Center Council, were selected by the department as the sole developers of city-owned land.
Their projects will create roughly 650 units of affordable housing, while another 250 are expected through the inclusionary zoning program, which provides developers incentives to make 20 percent of their projects affordable.
Forty community groups from the Black, Latino, and Jewish communities joined together to oppose the plan, also taking issue with the exclusion of residents from a neighboring community board, across Flushing Avenue, the southern boundary of the Triangle, which is bounded to the north by Broadway and to the west by Union Avenue.
With the help of former planning commissioner Ron Shiffman and students at the Pratt Institute, they devised their own plan that called for a much higher density in the area, creating three times as much affordable housing, though the plan was deemed out of context by Community Board 1, which reluctantly supported the city’s plan.
“There were a lot of passionate views on all sides,” Daniel Garodnick said in an interview after the vote. “But ultimately, I voted on the considerable merits of the plan, of the many affordable housing units, and that was meaningful to me.” Gardonick did echo complaints about process, chastising the city for selecting its developers behind closed doors.
A small modification was made to the plan, allowing for more open space on a city-owned site, which the community had been clamoring for, but it is at the cost of 45 affordable housing units, also in desperate need. "We are well below average in both areas," Reyna complained. "This is no plan at all."
While the vote of 12–6, with one abstention, may not seem close, any measure requires a majority of the committee’s 23 members to pass (four were absent). “In my eight years on the committee, I can’t remember anything this close,” councilmember Tony Avella said afterward. “Usually, these things pass unanimously, or there is maybe one or two votes against.”
Still, it was the city’s closed process that drew the most complaints from those voting against the plan. “Process is important, and the process here is very troubling, and we as a body have to come together to address this,” councilmember Rosie Mendes said. One committee member, Vincent Ignizio, opposed the plan because the city plans to use eminent domain, which he said “haunts this council and this nation.”
When the real-estate industry went into deep freeze, word had it that developers would use their recessionary downtime to get planning approvals in line for the uptick to come. And sure enough, New York’s City Planning Commission had a marathon day yesterday, approving the Related Companies’ Hudson Yards project and Kingsbridge Armory redevelopment, the rezoning of the Broadway Triangle in Brooklyn, new approvals for Jean Nouvel’s MoMA tower, and—the biggest surprise of the bunch—the announcement that the city was moving ahead on acquisition of the final stretch of the High Line.
The High Line news came just after commission chair Amanda Burden voted in favor of the re-rezoning of the western portion of the Hudson Yards, which had been designated for a stadium in 2005 as part of the city’s Olympic bid. Burden perked up noticeably when she made the announcement, declaring, “The vision of the High Line will not be realized until it extends all the way from Gansevoort Street to 34th Street. That’s why I’m pleased to announce that the city is preparing an application to acquire the final piece of the High Line.”
Burden added that she expects the process to be completed by the end of the year, at which point it will enter the public review process. The continuation of the elevated park, the first phase of which opened to great fanfare earlier this year, has been an open question throughout the Hudson Yards development process. While commensurate open space was required, some developers bidding on the project wanted to replace the High Line with a new park north of 30th Street, arguing its preservation would make building the deck over the rail yards more difficult.
Related, which took over the project after Tishman Speyer backed out last year, was ambivalent about including the High Line in its plans. The developer did seem to warm to the idea as the commission increasingly indicated that was the direction it was leaning, working language supportive of preservation into the rezoning in September. Until today’s announcement, though, nothing was assured.
Peter Mullan, vice president for planning and design for Friends of the High Line, said after the announcement that he was excited by the news, but more work remains. “This does not guarantee preservation, but it’s the beginning of the process to ensure preservation and the most significant and concrete step in the process,” Mullan said.
The city must now come to an agreement with CSX, the national railroad operator, to purchase the final stretch of track. No previous deal had been made because the tracks would have been demolished under the stadium plan, and then the city was unsure what action the developers would take.
As for Related’s massive project abutting the High Line, the commission approved changes to the 2005 rezoning, replacing the stadium with one commercial and seven residential towers surrounded by acres of open space, by a vote of 12-1. This will be a part of the completed Hudson Yards, which also includes a parcel east of 11th Avenue that was rezoned in 2005 for commercial and residential use.
The commission made some changes to the Related plan for the western yards that was certified in May, following criticism from the local community board and the borough president. In further deference to the High Line, one tower at the project’s southwest corner that would have straddled the elevated park has been pushed back and its height reduced, though it still overhangs the tracks by 50 feet (the Standard rises 30 feet above).
Changes were also made to the open space, which had been described as “too Bryant Park” by the board. Now, it will be more tightly integrated with the surrounding buildings, along with more seating and other minor changes. Burden also announced the assent of the School Construction Authority to develop a new primary school within the western development. Related could not be reached for comment about these changes.
“They heard everything we said,” Lee Compton, former chair of Community Board 4, told AN after the vote. “They did not agree with everything, though, and we’re going to continue to fight for them.”
The major sticking point, and the reason for the one dissenting vote, is affordable housing. “This project will contribute a number of important, positive aspects to the borough,” commissioner Karen Philips said. “But I am concerned by the lack of onsite affordable housing.” Related has pointed out that 600 units will be created off-site, but Compton said that those were promised during the 2005 rezoning. “To take credit for them would be double dipping,” he said. The community hopes to sway the City Council to require the developer to include more affordable housing, ideally within the site, when the council votes on the project in the next 50 days.
Things did not go as smoothly for Related’s Kingsbridge Armory, an old military hall in the Kingsbridge section of the Bronx that has lain vacant for 15 years. The developer wants to turn the massive 57,500-square-foot building into a mall, including a 60,000-square-foot grocery store, which has drawn fire from two local grocers that fear it will put them out of business. Four commissioners sympathized with this issue and voted against the project, though it was still approved by 8-4 with one abstention.
During the meeting, the room was stormed by about two dozen unionists who have also been fighting Related for wage guarantees, along with the borough president Ruben Diaz, Jr., who was in the audience. The commission did not comment on this issue, but pressure will no doubt be brought to bear on the council. “I vote yes on this item trusting that progress on this project will continue,” commissioner Richard Eaddy said.
Another contentious community project was approved yesterday, this one with little uproar. Despite an alternative plan with the support of some 40 community groups, the commissioners approved the city’s rezoning application for the Broadway Triangle 11-1 with one abstention.
The commissioners who did speak up embraced the position of the community board, which argued that a good plan—with contextual zoning and nearly 1,000 potential units of affordable housing—was created in the worst of ways by the Department of Housing Preservation and Development, which largely ignored the community in the process. “We have had these issues with HPD in one manner or another in the past,” commissioner Irwin Cantor said. “I hope we don’t see HPD making similar errors in the future.”
As for Jean Nouvel’s midtown tower, it had already been approved in September, when the commission unexpectedly chopped 200 feet off the top, leaving it at 1,050 feet. Then, at City Hall two weeks ago, the council decided further changes needed to be made to the street-level facade, which had been more of a concern to the community all along.
Despite a personal plea from Nouvel to restore the full height of the tower, the council instead referred it back to the commission after reducing the hotel square footage from 150,000 square feet to 100,000, which eliminated the requirement for a loading dock on 54th Street. (The council also requested that MoMA make the wall to its sculpture garden more transparent and community friendly, something that has been a bone of contention since the expanded MoMA reopened in 2004, though that changes was not under the purvey off the commission.) The changes were approved unanimously, and the council is now expected to vote on them in the next few weeks.
The Broadway Triangle looks like countless other stretches of North Brooklyn, a mix of machine shops, walk-ups, and vacant lots seeded among the bistros and luxury condos that have moved in over the last decade. The area, surrounded by communities of Latinos, African Americans, and Chasidic Jews has seen its fair share of conflict, but a new battle has broken out, some say more rancorous than all those that have preceded it, and it is a battle over a rezoning.
“It’s like the last open piece of Oklahoma Territory,” a local developer told AN during a contentious community board hearing in July.
Bounded by Broadway, Union Avenue, and Flushing Avenue, the Broadway Triangle was 22 blocks of failing industrial uses that in 1983 was made an urban renewal area in an effort to revive it. That plan never took off, and now the Bloomberg administration wants to rezone a nine-block slice at its heart for housing.
The city’s plan, which is being developed by the Department of Housing Preservation and Development, paves the way for 1,850 new apartments, 905 of which will be designated for affordable housing. Two city-owned sites will be wholly dedicated to affordable housing, while the rest of the rezoning is open for developers to build higher in exchange for additional affordable housing in accordance with the inclusionary housing program. Low-rise, contextual zoning has been promised.
The plan has won begrudging support from the local community board and the borough president, as well as a thorough examination from the City Planning Commission at a September 9 hearing on the plan. A final vote had been expected for this Wednesday, but it is now scheduled for October 19.
The main criticism of the plan has had less to do with the plan itself than with the way it was conceived unilaterally by the department. Who will develop the two city-owned sites is of particular concern. And a coalition of more than 40 local groups from across the neighborhood has formed to look into these matters.
“There has never been this kind of support from so many peoples—Latino, Jewish, and black all coming together to fight for a single cause,” said Juan Ramos, director of the Broadway Triangle Community Coalition.
The group’s chief complaint is that they have had no involvement in helping craft the city rezoning, a break from precedence whereby community involvement in planning has been extensive. There are also concerns about access to the affordable housing, since two politically connected organizations have already been tapped to develop the city-owned sites.
The coalition reached out to the Pratt Institute to devise its own plan, where students under the direction of former planning commissioner Ron Schiffman created a proposal whose scope reaches well beyond the bounds of the city’s work, and even the nine-block site. The coalition’s plan encompasses the entire urban renewal area, including the defunct Pfizer pharmaceutical plant that the group wants to turn into a manufacturing incubator. It also calls for housing across a range of densities—including buildings as tall as nearby public housing towers. With height, the plan can provide three times as much housing and five times the affordable housing units.
“We can’t reach our sustainability goals or our affordability goals without density,” Shiffman said.
While the coalition’s plan is unlikely to succeed, it has highlighted deficiencies in the city’s plan that the community board now wants addressed, such as increased open space and the inclusion of residents from Bed-Stuy and some extant industrial businesses. The Department of Housing Preservation and Development also drew a lashing from the board for its handling of the planning process.
“HPD is always doing this, and it has to stop,” said Ward Dennis, chair of Community Board 1’s land-use committee. “It’s a good plan, a good contextual plan, the kind we’ve been advocating for. The problem is, the process stinks.”
There is still a remote possibility the plan could be overhauled or even fail, as a neighboring City Council representative opposes the project altogether. But for Rabbi David Needleman, head of the United Jewish Organizations of Williamsburg and the likely developer of the larger of the two city-owned sites, defeat would be untenable: “What it means if this project is derailed? How long will it take to recreate itself? Maybe never. 30 years ago we started this. Let’s not have to start over.”
A version of this article appeared in AN 10.07.2009.
Last year’s bursting real estate bubble left the five boroughs littered with vacant and half-built projects, many of them market-rate units few can now afford. But city officials are hoping to rescue some of those stalled projects, create much needed affordable housing in the process, and begin to steady the real estate market as a result. Wednesday, the City Council and Bloomberg administration announced a $20 million program known as HARP—as in Housing Asset Renewal Program—that would subsidize the conversion of upwards of 400 stalled market-rate units into affordable ones.
By thawing frozen projects, the hope is to free up financing to finish construction on those that are not yet built and to fully occupy those that are. (The imprimatur of the city should help with financing, as well.) Meanwhile, the city will help stabilize these buildings and their surrounding neighborhoods, thus avoiding the blight that plagued the city during the decline of the 1970s and 1980s. With 138 stalled projects confirmed by the Department of Buildings, and countless more unaccounted for, there are plenty of projects in need of support.
“Private developments that sit vacant or unfinished could have a destabilizing effect on our neighborhoods, but we’re not about to let that happen,” Mayor Michael Bloomberg said in a statement. “This program holds out the promise of addressing the unintended blight caused by vacant sites, while transforming what would have been market-rate buildings into affordable housing for working class New Yorkers.”
The program is the result of a council taskforce on affordable housing launched in 2008, though many of its ideas crashed along with the housing market. Instead, the taskforce began outlining HARP, which speaker Christine Quinn introduced in February during her State of the City address. The council then turned to the city’s Department of Housing Preservation and Development to implement the details and administer the program, which is still in the pilot phase. The cost is also shared between the council and the city through the reallocation of existing capital funds.
The city will issue a request for funding applicants—a sort of RFP with a rolling deadline—in July that is expected to run through December. Applicants will be judged on three criteria: those who offer the deepest discounts, require the least amount of subsidy, and provide the most “stabilization” to the neighborhood. For instance, a single building in need of subsidy in a ten block radius would be more likely targeted than 15 buildings in need within a five block radius, according to Andrew Doba, a council spokesperson.
While details of the plan are still being worked out, the expectation is that most of the money will be spent in the outer boroughs, where the greatest speculation and destabilization took place, and also where the city can stretch its money the furthest. For each unit of a project pledged as an affordable rental unit, applicants will receive $50,000 an amount officials emphasize is about a third to a half as expensive as the typical rate paid for new affordable units. Both unfinished and finished-but-empty projects are eligible for the program, though the expectation is that only a portion of a project’s total units would be converted from market-rate to affordable.
But first those seeking money must agree to take a loss on their projects, as the city insists that the program is not intended as a handout or bailout. “This will require real sacrifice from the banker and the developers,” Catie Marshall, a spokesperson for the Department of Housing Preservation and Development, said. “We’re not going to bankrupt anyone, but we’re not making them whole, either.”
Marshall said the department expects to get many of its applications from banks that have foreclosed on projects and want to get rid of them as quickly as possible. When money will begin to flow out remains to be seen, but it could be as soon as the department begins getting applications back. “We could start working on projects, depending on what comes in and how clean it is, by the Fall,” Marshall said. If the pilot phase goes well, the city will consider expanding it or even making it a permanent housing program.
Developers large and small, not-for-profit and high-end are already hailing the project. “I see a plus-plus for the city of New York, both for the people in the neighborhoods, who won’t have to look at these half-built buildings anymore, and the affordable housing users who will have shelter,” said Vincent Riso, a principal at the Briarwood Organization, which has been developing affordable housing since the 1980s.
Steven Spinola, president of the Real Estate Board of New York, acknowledged that while the program would not directly benefit his members—many of the city’s biggest name developers—it would provide a benefit by absorbing excess inventory and stabilizing lending. “I think it’s a creative use of rather limited city resources, and at the same time to throw a little help to a developer in challenging times,” he added. “It will create opportunities that did not exist before.”
And given the continued stasis in the financial markets, HARP could be the only opportunity for developers to get projects off the ground. “There’s so much inventory, why would a bank finance any new construction?” said Julien Vernet, Briarwood’s marketing director.
The only criticism of the program so far was that it would primarily support middle-income families because lower income housing would require greater subsidies. “They can either serve a large number of folks with a moderate income or less folks with low income,” Josh Lockwood, executive director of Habitat-NYC, said. “We just hope there’s room in the conversation for low-income families.”
But Lockwood was also quick to praise the program as one-of-a-kind. “They’re light years ahead of anywhere else just trying to make this work,” he said. “I just hope other cities will follow.”