The 421a tax program expired more than a year ago, but developers are still squeezing projects in hoping to qualify for the big break.
Brause Realty filed plans for a 20-story, 157-unit project at 729 Second Avenue in Murray Hill, Crain’s reported. The 129,000-square-foot project is expected to span a handful of adjacent sites owned by the developer, and likely take an East 39th Street address.
The 237-foot-tall project will include 4,600 square feet of retail space and is being designed by CetraRuddy. Amenities will include a roof deck, gym, coworking space, children’s playroom and tenant club.
The 421a tax break requires at least 30 percent of units to be restricted for affordable housing, though the developer hasn’t set income levels. Despite the break’s expiration last June, developers with foundation footings in the ground by June 15, 2022 still qualify for the program as long as the projects are completed by June 15, 2026.
Brause filed demolition plans for 729 Second Avenue at the start of last year and demolition across the parcels is ongoing. Construction is anticipated to begin later this year and conclude by late 2025. The developer’s estimated cost and financing for the project weren’t immediately clear.
Brause’s development portfolio goes beyond New York, including projects in New Jersey, Connecticut, Maryland and Florida. Among its notable projects in New York City are The Forge luxury apartment building in Long Island City, the MetLife Plaza office in LIC that serves as JetBlue’s HQ and a 15-story boutique office property on West 31st Street.
One year after 421a’s official demise, a replacement to help spur multifamily development remains elusive. Lawmakers claimed last month they were near an agreement to extend the tax program’s construction deadline, only for Gov. Kathy Hochul to withhold support from the measure, which also included good cause eviction.
Without an extension, as many as 32,000 planned apartments may not be built, according to the Real Estate Board of New York.
— Holden Walter-Warner
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