New building requirements that protect against flooding have put landlords of public and regulated multifamily buildings in a catch-22 situation, according to a new report from the NYU Furman Center.
New flood insurance rates imposed in the wake of Superstorm Sandy leave landlords with a tough choice: pay higher insurance premiums or embark on costly retrofits that would lower those premiums, the New York Observer reported. The dilemma affects 1,500 buildings with 90,000 units of public, subsidized or rent-stabilized housing. The report concludes that the only viable choice for many landlords is to make them market rate.
The report, entitled “The Price of Resilience: Can Multifamily Afford to Adapt,” puts the price of upgrades at $435,000 for a 5-unit building at the low end. A nearly 200-unit building would pay $2.5 million, according to report findings cited by the Observer. [NYO] — Tom DiChristopher