The Real Deal New York

How common are NYC’s poor doors?: PHOTOS

Extell’s two-entrance building far from unique, but the devil is in the details

August 27, 2013 02:30PM
By Julie Strickland

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Extell Development sparked a ferocious backlash — and viral sensation — when it revealed that its new 33-story 40 Riverside Drive would have two separate entrances: one for condominium buyers and one for tenants in affordable rental units.

The so-called poor door, to be sure, is not the only politically incorrect entrance of its kind in New York City. But just how common is the phenomenon in buildings that house a mix of market-rate condos, market-rate rentals and/or affordable rental units?

It seems that only a handful of similar poor doors exist across the city, including 40 Riverside Boulevard and 1 Northside Piers in Williamsburg, according to brokers and developers who spoke with The Real Deal. But the devil, it seems, is often in the details. Some large buildings, such as 200 East 94th, appear to have a “poor door,” but in fact have two entrances that are open to renters and owners alike.

Toll Brothers’ 1 Northside Piers, for instance, includes 134 affordable rental units, allowing the developer to offer 421a tax abatements to buyers in both 1 and 2 Northside Piers. The affordable units are located in the base of the tower at 4 North 5th Street, and the tower itself is not accessible from that part of the building. And while No. 1 shares a common wall with No. 2, the two are technically separate entities. At Douglaston Development’s the Edge in Williamsburg, middle-income residents cannot use building amenities – a common setup in mixed-income buildings.

The goal with changes to the 421a program, which rewarded developers with 10 to 25 years of tax abatements for the inclusion of affordable rental units — which were often passed on to the condo buyers – was to nudge developers to include affordable dwellings in their developments, rather than off-site, some say. And while that goal to create affordable housing is bringing below-market units to neighborhoods all over the city, it does not always guarantee that everyone will fully mix.

“No one ever said that the goal was full integration of these populations,” said David Von Spreckelsen, senior vice president at Toll Brothers. “So now you have politicians talking about that, saying how horrible those back doors are. I think it’s unfair to expect very high-income homeowners who paid a fortune to live in their building to have to be in the same boat as low-income renters, who are very fortunate to live in a new building in a great neighborhood.”

Mayoral candidate and City Council Speaker Christine Quinn responded to the 40 Riverside Boulevard backlash by calling for the state to intervene in Extell’s controversial plan.

“I do not believe that these discriminatory practices were ever contemplated by the legislature,” Quinn told the New York Post. “We need to change state law so that developers [eligible for the exemption] provide common entrances and facilities for residents of the building.”

Greenpoint Landing, Joseph Chetrit and David Bistricer’s 300,000-square-foot luxury project at 77 Commercial Street that would include 200 cheaper units, is also drawing community ire for a prospective “poor door.” Treading lightly in the wake of Extell’s 40 Riverside firestorm, the developers insist they have yet to make a final call on segregated entryways.

Despite the controversy separate entrances can ignite, some say the arrangement is a logical one. Affordable housing and market-rate rentals or condos are different types of products, some real estate professionals argue, that beget a different set of expectations.

For others, the seamless integration of differently-priced units makes far more marketing sense.

“I don’t see those [affordable] units having an impact on the market-rate units,” said Jonathan Miller, president and CEO of appraisal firm Miller Samuel. “The blending of the unit types, if anything, makes the difference between the rents being paid by one group versus another somewhat seamless.”

Some mixed-income properties do indeed take that approach, such as the Related Companies’ 89 Murray in Tribeca, a 163-unit, 50/30/20 property.

“That building has one entrance,” said Jeffrey Sussman, executive vice president of Edward Minskoff Equities, “no differentiation among the people or anything like that.”

  • Affordable Housing Advocate

    Other projects
    with separate entrances (built and planned): River Place by Silverstein,
    Hallets Point by Lincoln Equities, Domino by Two Trees, etc.

    But the bigger
    point is that the City’s affordable housing plan has depended largely
    on building new 100% affordable housing in the Bronx, Harlem, and outer Brooklyn
    – typically with substantial subsidies from HPD and HDC and often on land
    sold for $1. While these projects are laudable and have helped to turn around
    blighted areas of the city, it is hypocritical for politicians to give money
    to and celebrate the ground-breakings for these 100% affordable developments,
    then to turn around and criticize new affordable housing on private
    land, in high-cost neighborhoods just because it has a separate entrance.
    It makes no sense to require the distribution of low-income rental units
    throughout a market-rate condominium, and it will greatly limit the ability
    of those market rate condos from being able to cross-subsidize the creation of
    the affordable housing in the first place.

  • Michael R

    If the Developers and Luxury condo owners want a product where they don’t have to rub shoulders with the “affordable” public, then they should not expect to get tax breaks to enable that kind of thinking. End of story.

    • Ben

      Completely inaccurate. You are ignoring the benefits allocated to the affordable housing tenants, which the City obviously takes into account when making these kind of arrangements. As was quoted in the article, the affordable housing tenants “are very fortunate to live in a new building in a great neighborhood”.

      As someone who currently lives in a rent stabilized five-story walk-up, I can honestly say I would much rather live in a new construction building with separate entrances from the multi-million dollar condominiums at 40 Riverside Blvd than stay in my current situation, which is a hell of a lot better than what most affordable housing tenants are accustomed to.

      If you were in a position to purchase a $30M condo, would you want to be sharing entrances and common areas with tenants? Even if you wouldn’t take issue with it, the typical buyer in a position to purchase a condo at this price certainly would and likely would look elsewhere. The cost of constructing the affordable housing units is dependent on the sales price of the condominiums, which would absolutely be affected by the integration of units types.

      Regardless of whether or not you find the separate entrances acceptable or ethical, eliminating tax breaks developments of this type would hurt affordable housing tenants far more than the project sponsors.

  • Hmmmm

    If you make developers scatter affordable units throughout the building they simply won’t take the tax breaks and won’t build any affordable units. It’s fact. Barnett even said so this week. Make him scatter units and he’ll build market rate only.

    • Austrian Economist

      And that’s the way it should be!

      • Ben

        Developers shouldn’t be provided with an incentive to build affordable housing units? Why not?

  • Steve

    Mima has two separate doors, for the regular renters and for the ‘high-end’ renters. non of which is ‘affordable housing’

    • JFreely

      MiMa has affordable housing there too and they don’t segregate entrances in any of their buildings that I know of. Most of their rental buildings are 80/20 too.

  • Window Maintenance

    How it can be common?

  • loving blog

    I could not find the logic to this. I think this would only cause division for the people living there. Why don’t just leave the old entrance? I am hoping this will not happen to real estate Beverly hills ca (