Housing groups have another week to fight for their priorities in the state budget. But some lawmakers are pushing the density debate in a different direction.
After Assembly and Senate Democrats ignored the cap on the city’s residential floor-area ratio in their budget proposals, some are supporting allowing office-to-housing conversions to exceed it.
There is a big catch: Buildings would need to make at least 40 percent of the units affordable.
Residential buildings constructed after 1961 in the city are limited to a floor-area ratio of 12, meaning floor space is limited to 12 times the area of the lot. Yet office buildings in various parts of the city can rise well above that limit.
Lower Manhattan office buildings constructed after 1977 can also be converted to residential use and exceed the cap.
Gov. Kathy Hochul proposed lifting the cap to ease the city’s housing shortage, but the Democratic majorities didn’t go for it.
Now Deborah Glick, who represents Greenwich Village in the Assembly, has proposed a measure that mirrors the Housing Our Neighbors with Dignity Act, approved in 2021. That law was supposed to encourage the conversion of distressed hotels into housing, but has yet to lead to any such projects.
The law had caveats that made conversions unappealing to the real estate industry, if not unworkable. It required at least 50 percent of converted units to go to residents who experienced homelessness immediately before moving in, and that such projects be developed by state-approved nonprofits.
Some critics say the new conversion bill is similarly infeasible.
“It really is a repeat of legislation that was supposed to turn hotels into housing and has yielded zero projects,” said John Sanchez, executive director of the 5 Boroughs Housing Movement, which has advocated for the cap to be lifted. “At some point, Manhattan will need to do its fair share to address the housing crisis.”
Assembly members Harvey Epstein and Jo Anne Simon also support Glick’s bill.
“The last few decades have shown us that overdevelopment under the current 12 FAR cap has led to an abundance of luxury units and a dearth of affordable housing,” Glick said in a statement. “Lifting the cap entirely is just the green light for rampant luxury development real estate developers seek.”
However, even if the state lifted the cap, the City Council would still need to rezone to allow for denser housing. That would trigger affordable housing requirements under the city’s Mandatory Inclusionary Housing program.
Paul Selver, co-chair of Kramer Levin’s land use department, called Glick’s proposal an example of “the perfect being the enemy of the good.” He said without a tax break to encourage conversions, which the governor proposed in her executive budget, rental housing will not be built.
For years, state lawmakers have refused to give up control of the city’s residential density. Glick’s bill, if nothing else, indicates that a carveout — such as lifting the cap for office conversions — may be palatable.
Advocates on Monday got a bit more time to make their case for pro-housing measures, including the governor’s Housing Compact, in the state budget: Hochul agreed to extend the budget deadline to April 10.
“We must make real progress to make New York more affordable, more livable and safer,” she said in a statement.
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