The Daily Dirt: City still envisions a deal on 421a, good cause

The Adams administration thinks there is a deal to be made on housing.

The “deal” would involve replacing the property tax break 421a and adding tenant protections. During a hearing Monday by the state Assembly committees on housing and cities, Deputy Mayor Maria Torres-Springer wouldn’t exactly say that the administration backs a form of good cause eviction.

The “devil’s in the details,” she said, but testified that the administration “stands ready to partner” with the legislature on a “framework that delivers new supply and new tenant protections.”

Unsurprisingly, much of the hearing touched on 421a, the expired tax break. Torres-Springer said the administration is eager to help “design a better program with appropriate labor standards and deeper affordability.”

“Because having no program is not an option,” she said.

Kevin Elkins, political director for the New York City District Council of Carpenters, wants citywide wage requirements for projects receiving 421a. Under the last iteration of 421a, average hourly wage requirements were set for projects with 300 or more rental units and below 96th Street in Manhattan or on the Brooklyn and Queens waterfronts facing Manhattan.

The carpenters’ union wants to move away from an average wage for a jobsite, and has suggested minimum wages based on specific trades. It would get rid of geographic restrictions and reduce the unit threshold to 100 apartments. The union has attacked the Real Estate Board of New York in recent weeks, alleging that REBNY won’t negotiate in good faith and has dismissed several proposals by the union.

“REBNY turned around and offered garbage,” Elkins said. “They’ve rejected every compromise we’ve put forward.”

When asked about the comments, a spokesperson for REBNY responded that the group is looking forward to “continuing to work with the building trade unions to ensure that any replacement program results in good jobs and the housing we need.” 

Assembly member Linda Rosenthal, who chairs her chamber’s housing committee, questioned the lack of data on projects that vested under the old 421a but are in danger of missing the 2026 completion deadline to receive the benefit. This came up last year too.

One of the reasons we don’t have a clear picture of the projects vying for 421a is because of a change Rosenthal and her colleagues made in 2017. They got rid of a pre-certification process that gave developers some assurance of qualifying for the tax break before completing their project. Developers were made to apply for the tax break after finishing projects, so it is less clear how many projects are banking on receiving 421a benefits.

On Monday, Gov. Kathy Hochul announced that the state has received 19 applications for her 421a alternative in Gowanus, which could yield as many as 5,500 apartments. The state has not announced what projects will be approved, but is expected to do so by summer.

What we’re thinking about: What do you think of the city’s “Unlocking Doors” program? Send a note to kathryn@therealdeal.com.

A thing we’ve learned: When the Federal Deposit Insurance Corporation announced the winning bid for a stake in Signature Bank’s multifamily debt portfolio, it did a curious thing: The agency only named Community Preservation Corporation as the winner. That is despite Related Fund Management and Neighborhood Restore also being on the winning team. Obviously excluding the for-profit firm makes sense from a public relations standpoint, but not from a transparency standpoint. H/T to Suzannah Cavanaugh on her extensive reporting on this issue.

Elsewhere in New York…

— Real estate lobbyist Melissa Rosenberg is running for Assembly in the Upper West Side’s 69th District seat, City & State reports. Rosenberg, who works for Kasirer, told the website that she decided to run after watching Albany’s “complete dropping of the ball” on housing issues last session. The Democratic primary to succeed Danny O’Donnell will take place this summer.

— The Department of Environmental Conversation is expanding its probe into toxic fumes beneath the Royal Palms Shuffleboard Club in Gowanus to 273 nearby properties, Gothamist reports. In March 2021, officials found levels of TCE, a cancer-causing chemical, were 20 times above the state limit.

— A jury found actor Jonathan Majors guilty of assault and harassment for attacking his girlfriend in a car in Manhattan, the New York Times reports. Marvel Studios, which planned to center several films around Majors, including “Avengers: The Kang Dynasty,” dropped Majors after the verdict.

Closing Time

Residential: The priciest residential closing Monday was $7.5 million for a condo, storage room and parking space at 15 Renwick Street in Hudson Square.

Commercial: The most expensive commercial closing of the day was $56 million for an office building at 1825 Park Avenue.

New to the Market: The priciest residence to hit the market Monday was a condo at 551 West 21st Street in West Chelsea asking $17 million. Bespoke has the listing.

Breaking Ground: The largest new building filing of the day was for a 3,600-square-foot, two-family residence at 200 Brant Avenue, Staten Island.