The Real Deal New York

Alicia Glen on 421a: “If you broke it, you better figure out how to fix it”

Deputy mayor also provides update on the city's affordable housing initiative
By Kathryn Brenzel | October 25, 2016 12:02PM

Alicia Glen

Alicia Glen

It was supposed to be an occasion to tout the growth of construction in New York City. But the conversation at the New York Building Congress breakfast Tuesday morning inevitably turned to 421a, the death of which is seen as a major barrier to developing rental housing.

“If you broke it, you better figure out how to fix it,” said Alicia Glen, deputy mayor for housing and economic development. She didn’t say explicitly who “broke it,” though she urged the audience to “continue to put pressure on our leaders in Albany to get this done.” 

In June 2015, the State Legislature granted an extension to the abatement program with revisions, which included requiring developers to make a certain percentage of their projects’ units affordable. Those changes were championed by the city, but the measure ultimately expired in January. Other possible replacements have been floated — including a wage subsidy program proposed by Gov. Andrew Cuomo — but are yet to be realized.

“It’s nearly impossible to finance rental construction in New York City without a tax benefit, and our housing market simply leans too heavily on condo as it is,” Glen said.

Glen, who joined the administration from Goldman Sachs’ Urban Investment Group , also provided an update on the mayor’s affordable housing initiative — to build or preserve 200,000 affordable units over the next decade. She said the administration has financed 55,309 affordable apartments in the past two years — up from the 52,936 units Mayor Bill de Blasio announced in July. Still, the mayor’s Mandatory Inclusionary Housing program has faced some resistance from City Council members and it’s unclear how it will ultimately pan out.

“We are on budget and ahead of schedule,” Glen said. “Yes, we have 144,000 to go, but it’s not like we haven’t been doing anything.”

Tuesday’s event coincided with the release of the Building Congress’ latest construction outlook report. The organization forecasts that construction spending will reach $127.5 billion through 2018.  The report also urged for the revival of 421a and the expansion of design-build authority in the state.

“Success is what we have in the New York City construction market right now,” said Richard Anderson, president of the Building Congress said. “We’ve got to keep the good times rolling.”