Carl Weisbrod is sounding the alarm on the rental housing market.
At a City Council budget hearing on Tuesday, the head of the planning commission warned that without the 421a tax abatement that expired in January, developers will continue to build luxury condominiums, rather than much-needed rental housing.
Weisbrod’s warning, reported by the New York Daily News, joins a chorus of laments over the lapse of the the state tax break. Developers and public officials have warned that the lack of 421a will make building rental housing in the city financially untenable. They’ve also pointed out that the success of the recently approved Mandatory Inclusionary Housing measure will be muted by 421a’s absence. The prospect of more luxury housing coming online is unattractive for other reasons. Over the past year, experts have repeatedly warned that the market for ultra luxury housing is softening.
The abatement expired when unions and developers failed to reach a deal over whether or not workers on projects under the program should be paid prevailing wages. The future of the program — or whatever may replace it — rests with Albany, which has remained relatively mum on the issue.
“The absence of 421-a is going to put a thumb on the scale against rental housing, and that’s unfortunate,” Weisbrod said.
The Real Deal reported earlier this month that by 2017, New York City may have five years of excess inventory. [NYDN] — Kathryn Brenzel