New York Will Require More Builders to Add Affordable Units
By MATT A.V. CHABAN and MICHAEL M. GRYNBAUM
SEPT. 5, 2014
The next time a New York City developer seeks permission to replace a derelict factory with a shimmering condo tower, the heated swimming pool and sky-lit roof lounge will have to be accompanied by another amenity: affordable housing.
In the most forceful remarks yet of an administration determined to reshape the cityscape, Mayor Bill de Blasio’s top planning official declared on Friday that affordable units will be a requirement for any future real estate project requiring a zoning change from the city.
The mandate will apply not only to neighborhood-wide redevelopments, like the earlier transformation of industrial Williamsburg into a residential mecca, but also to individual projects, as when a developer needs a waiver to graft stories onto an apartment tower in Midtown.
“You can’t build one unit unless you build your share of affordable housing,” Carl Weisbrod, chairman of the City Planning Commission, told a packed room of landlords, planners and investors at a New York Law School breakfast on Friday. “You can’t build just market-rate housing, period.”
Aides to Mr. de Blasio, who has pledged to create or preserve 200,000 affordable units in the next decade, have signaled for months that mandates for developers were on the way. But Mr. Weisbrod’s comments provided the clearest glimpse yet of what the city’s plan would mean in practice for the real estate industry, which is still wary of a mayor who has presented a lofty vision for future development but has provided few details on how he plans to achieve it.
New York City underwent immense change during the Bloomberg years, when thickets of new condos cropped up across Brooklyn and Queens. Few developers, however, opted to include affordable units, despite tax incentives and other subsidies dangled by the last administration. A report last year estimated that of 21,000 new housing units built as an outgrowth of major city zoning changes since 2005, only about 13 percent of the units, about 2,700, were affordable housing.
Opting out is now off the table, Mr. Weisbrod said on Friday.
“There will be a minimum that the developer has to do without subsidy,” Mr. Weisbrod said, noting that affordable units would be a baseline requirement for new projects that require a zoning change. “It’s mandatory.”
Surprising some audience members, Mr. Weisbrod said the requirements would apply not only to neighborhood-wide residential zoning changes, but also to virtually every apartment project of six or more stories that city planners must approve. (Projects not requiring a rezoning would still be allowed to rise without adding affordable units.)
Still, much of the city’s housing plan, which calls for the building of 80,000 affordable units and the preservation of 120,000, remains shrouded. Mr. Weisbrod said an initial plan would be revealed by year’s end. The mandate would take effect by the fall of 2015, though the rules could be held up by a series of public reviews.
In the interim, private projects would still be subject to the same new standards, which will prevent developers from rushing construction to avoid including affordable units. Astoria Cove, a 1,700-unit project along the East River in Queens, is the first such project under review to opt into the zoning program at the behest of the administration.
Mr. de Blasio’s team declined to say which neighborhoods they were examining as potential sites for large-scale redevelopment, except East New York, Brooklyn, which was announced in May. These communities could gain hundreds or thousands of units of affordable homes.
Astoria Cove in Queens, in a rendering, has opted in to the new rules.
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But an official involved in internal discussions said that among the areas that planners are considering for zoning changes were East Harlem around Park Avenue, a stretch of Inwood along the Harlem River, both in Manhattan, and the eastern section of Long Island City in Queens. The changes would allow for higher density of residential buildings.
The official requested anonymity to describe private conversations that have been zealously guarded by the administration, which does not want to publicize the sites before it can hold discussions with residents in each neighborhood.
While some developers are wary of Mr. de Blasio’s new rules, many liberal housing advocates believe he is not going far enough. They say the administration should demand that a higher proportion of units in new developments be reserved for low- and middle-income residents.
The administration is eager to dispel those doubts, and Mr. Weisbrod’s comments on Friday were greeted warmly by advocates.
“They’re definitely going in the right direction,” said Jaron Benjamin, director of the Metropolitan Council on Housing, who has called for at least 50 percent of units in new buildings to be affordable. The Bloomberg administration set the affordability standard of 20 percent of units; the new mayor has vowed to aim higher but has not said how high.
Privately, some developers expressed skepticism about the administration’s plan, fearing that the requirements would make it financially difficult to build. While few in real estate criticize the mayor publicly, Mr. Weisbrod acknowledged those concerns, saying the industry was a necessary partner.
In his speech, Mr. Weisbrod said the administration would take steps to ease the bureaucratic burden on developers, such as speeding up the public review process and rolling back other onerous regulations. And he pledged that planning officials would consider new projects on the merits when determining how many affordable units should be included.
“What we think we require in a superhot neighborhood in Manhattan is going to be a lot different from what we think we can require, or should require, in an emerging area,” Mr. Weisbrod said.
The mayor, for his part, made clear on Friday that a new era had dawned. “I think developers understand that there was an election and this is what we said we were going to do,” Mr. de Blasio said at a news conference in Brooklyn. “We’re going to build a lot more affordable housing, and we’re going to ask more of them.”