Density won’t spur developers to build in low-rent areas

Report says that without government help, areas like East New York won’t see towers rise

New York /
Mar.March 26, 2015 09:33 AM

In low-rent neighborhoods where the city is planning rezonings to allow developers to build taller towers, the math won’t pencil out without government subsidies, according to a report by the NYU Furman Center for Real Estate and Urban Policy.

The city has proposed changing the zoning laws in neighborhoods including East New York, East Harlem and Cromwell-Jerome in the Bronx to allow for more density and spur development of affordable housing.

But the report finds that in neighborhoods like these, developers will only be able to set aside about 4 percent of units as affordable even with the new zoning laws, whereas in a high rent neighborhood, they might be able to justify the costs of setting aside 30 percent of units as affordable, according to the Wall Street Journal.

The report also found that even without an affordability requirement in the new zoning laws, developers are unlikely to build in low-rent neighborhoods without subsidies like 421a, which is up for renewal in Albany this June.

The administration has doubled the Department of Housing Preservation and Development to $2.5 billion over the next five years. [WSJ] — Tess Hofmann


Related Articles

arrow_forward_ios
From left: Mayor Eric Adams, Councilmember Kristin Richardson Jordan, and developer Bruce Teitelbaum (Getty Images, iStock/Photo Illustration by Steven Dilakian for The Real Deal)
Housing suffers crushing defeat as mayor, speaker do nothing
Housing suffers crushing defeat as mayor, speaker do nothing
From left: Bruce Teitelbaum and Kristin Richardson Jordan along with a rendering of One45 (Getty Images, One45, iStock)
Harlem affordable resi project withdrawn, appears dead
Harlem affordable resi project withdrawn, appears dead
Clockwise from top: Mayor Eric Adams, Bruce Teitelbaum, Adrienne Adams and Suri Kasirer (Getty/Adams via Paul Dilakian)
A make-or-break moment for NYC’s housing crisis
A make-or-break moment for NYC’s housing crisis
Midwood’s John Usdan and 210 Douglass Street (Midwood)
Landlord in rush for 421a booted Gowanus business: lawsuit
Landlord in rush for 421a booted Gowanus business: lawsuit
From left: Council member Kristin Richardson Jordan, developer Bruce Teitelbaum and a rendering of the planned One45 development (Getty Images, One45, iStock)
Council member calls 40% affordable project “slap in the face”
Council member calls 40% affordable project “slap in the face”
EMP Capital Group's Elie Pariente with 1034-1042 Atlantic Avenue (LinkedIn, Herokuapp)
Brooklyn developments avert disaster with rezoning deal
Brooklyn developments avert disaster with rezoning deal
City Council member Kristin Richardson Jordan, the Rev. Al Sharpton and lobbyist Suri Kasirer (Getty Images, RPG, iStock/Photo-illustration by Steven Dilakian/The Real Deal)
A Harlem real estate drama worthy of Hollywood
A Harlem real estate drama worthy of Hollywood
333 Jackson Avenue in Schenectady NY with Scannell Properties Development Manager Zachary Zweifler (Google Maps, Scannell Properties)
Upstate golf course zoned for housing, but developer seeks change
Upstate golf course zoned for housing, but developer seeks change
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...