NYCHA looks to net close to $50M annually leasing to private developers

4,330 new apartments to be built; developers will get 99-year favorable lease
February 06, 2013 12:00PM

The New York City Housing Authority intends to raise roughly $50 million by leasing land in the middle of housing projects to developers who could build up to 3 million square feet of luxury high-rises, the New York Daily News reported.

NYCHA will offer developers 99-year leases on the land, with payments frozen for the first 35 years, according to internal documents obtained by the Daily News. The land will yield 4,330 apartments — 20 percent of them affordable — in eight developments in areas including the Upper East Side and Upper West Side, the Lower East Side and Lower Manhattan.

Some officials, such as City Councilwoman Margaret Chin, have voiced a concern that the 20 percent affordable quota is insufficient. Previous disputes about the affordability quota have delayed new developments, most recently at Dust Fetner’s condo development at 625 West 57th Street.

The luxury housing will be built on top of neighborhood amenities such as parking lots, community centers and playgrounds, according to officials familiar with the project who spoke to the Daily News. NYCHA — which faces an annual budget gap of $60 million — is expected to earn between $31 million and $46 million in annual lease payments, which will be invested in the upkeep of its worn-out buildings. [NYDN]Hiten Samtani