Skip to main content

How many subsidized apartments for low-income families in first Atlantic Yards tower? Just eight 2BRs, as Forest City Ratner reneges on promise to build half the affordable space as 2BR/3BR units

How many affordable apartments would there be for low-income families--families that need two bedrooms or more--in B2, the first planned Atlantic Yards tower?

Only eight.

And that's out of 350 total units.

The building, which has been delayed nearly two years and has not yet broken ground, would include 130 studios, 180 one-bedroom, and 40 two-bedrooms.

Of those latter 40 units, 20 would be subsidized. However, only eight of them would be low-income, with monthly rents at $701.75 and $902.25, at least under current income guidelines.

The other subsidized "affordable" two-bedroom units--four each--would cost $1604, $2406, and $3007. It makes you wonder how much the market-rate units would go for.

Reneging on the pledge

Why so few larger units? For the first building, Forest City Ratner has reneged on its long-promised "goal" to ensure than half the affordable housing--on a square foot basis--would be two- and three-bedroom apartments.

And that was a key selling point to struggling families hoping for better housing, as noted in the screenshot at left, from the original AtlanticYards.com web site.

Note that the web site misleadingly implied that half the number of units--rather than square footage--would be larger units.

The pledge, with the "square foot basis" caveat, was part of the Affordable Housing Memorandum of Understanding the developer signed in 2005 with the housing advocacy group ACORN, and later incorporated into the Atlantic Yards Community Benefits Agreement (CBA). See screenshot at right.

The pledge was repeated in the November 2006 Atlantic Yards Final Environmental Impact Statement, Chapter 1, Project Description, which stated:
Affordable units would be reserved for households making between 30 percent and 160 percent of citywide Area Median Income (AMI) and 50 percent of these units (on a square foot basis) would be two- and three-bedroom units.
Now it seems abandoned--and for Forest City to meet the overall pledge, future towers would have to be skewed toward larger apartments.


Can they get away with it?

Apparently this path is OK, at least in terms of city oversight. According to rules promulgated by the New York City Department of Housing Preservation and Development, under the Inclusionary Housing program, a project must include a mix of affordable units that is either proportional to the market rate mix or includes at least 50 percent two bedroom units.

Guess which option Forest City has apparently chosen.

Think about it: how many families want to pay market rate for apartments in a tower next to a basketball arena, especially one that may be built via newfangled modular technology? Forest City likely concluded it has a better bet renting market-rate units to singles and couples.

That means smaller apartments, as indicated in the screenshot at right. And that means that most of the subsidized units would be small, as well.

The affordable studio apartments must be 400 square feet or more. The one-bedroom units must be at least 575. The two-bedroom unites must be 775 sf or more. The market-rate units, almost certainly, will be larger.

Both the 12/8/06 Memorandum of Mitigation Commitments and the updated 12/21/09 Amended Memorandum of Environmental Commitments produced by the Empire State Development Corporation provide lots of wiggle room. Both documents state:
Based on currently available information, the parties anticipate that the affordable housing units will be made available to households with incomes falling within the income bands set forth in the FEIS. However, the income bands may be adjusted to accommodate the requirements of any City, State or federal housing program utilized for the construction of the affordable housing, subject to City approval.
So too is City approval necessary for the mix of sizes. The building remains delayed, but Forest City Ratner in November announced their intention to build using modular technology, an effort to save money in the absence of extra subsidies.

We should know in a few months whether they will proceed with the modular plan, or instead use that plan as a threat to gain union concessions.

Could housing advocates make a stink? 

ACORN was contractually obligated to support the project--at least if it pursues the promised goals.

ACORN has been disbanded, but its longtime leader, Bertha Lewis, continues to support the project, unwilling, for example, to comment on the failure to hire an Independent Compliance Monitor required by the CBA.

And it successor organization is expected to help market the affordable units, which will be distributed via a city lottery, with half the units directed to residents of the three Community Boards containing the project.

Whatever the configuration, demand is such that the subsidized housing--at least the low-income units--will be hugely oversubscribed.

A misleading pledge

Not only is Forest City deviating from the pledge in the MOU and in the Final EIS, it exaggerated the pledge in public discourse.

Along with the screenshot from the AtlanticYards.com web site, look at the slide (left) shown to those who attended a July 2006 affordable housing information session at the Brooklyn Marriott.

It emphasized the role of larger units, stressing that about half of the "affordable units will be 2- and 3-bedroom units." Unmentioned was that the analysis would be on a square foot basis.

Similarly, in 5/20/05 coverage of the announcement of the housing plan, the New York Times summarized the plan: "half of them studios and one-bedrooms and half of them two- and three-bedrooms."

Looking at B2

Though Forest City Ratner emphasized the role of both two- and three-bedroom apartments, the first tower would not include any three-bedroom apartments, according to a fact sheet on the AtlanticYards.com web site and reproduced below.

Only 40 of the 350 units, or 12%, would be two-bedroom units. Of that total, 20 would be market-rate, and 20 would be subsidized.

But only 40% of the subsidized "affordable housing" is geared to low-income households, with incomes up to half the Area Median Income (AMI). The rest would go to moderate- and middle-income households.

What's 40% of 20? Eight.

That's the number of low-income families, for example, on the long list (128,000 as of December 2009) for Section 8 vouchers who might qualify.

Arguably, another 10% of the affordable housing is geared to the "real Brooklyn"--those who might qualify for public housing. If so, that means ten two-bedroom units would be available to those most needy.

What the mix could be

What if B2 included at least 50 percent two bedroom units, following city guidelines? That would means 175 such apartments, and, assuming no larger units, the remaining 175 units divided into studios and one-bedroom units.

What if 50% of the B2 square footage was devoted to larger units?

Assuming that the apartments would be all at the smallest size listed, in 2006 I calculated 719 studios (32%), 719 one-bedrooms (32%), 406 two-bedrooms (18%), and 406 three-bedrooms (18%).

If that ratio were applied to B2, then there would be, in total, 112 studios, 112 one-bedrooms, 63 two-bedrooms, and 63 three-bedrooms.

Divide by two for the affordable units.

The expected mix now, however, would be very different.

What would they pay?

Rent is based on Area Median Income (AMI), which includes not just all five counties in New York City but several wealthy suburban counties. When Forest City Ratner was discussing affordable housing in 2006, the AMI was $70,900, as in the chart below. The eligibility is divided among five income Bands.


Now, the AMI is $80,200.

Let's follow the same technique used on the chart: calculate the rent by taking the midpoint of each Band divided by 12 (to obtain monthly income), then multiplied by 30%. (Each Band gets 20% of the subsidized units, or 450 over the life of the project--but each Band also has a mix of smaller and larger apartments.)

I'll use only households with four people, who might want a two-bedroom apartment.

Midpoint for those in Band 1, the lowest income, is 35% of AMI, or $28,070. That translates into $701.75 monthly rent for a two-bedroom.

Midpoint for those in Band  2, the other low-income category, is 45% of AMI, or $36,090. Rent would be $902.25.

Midpoint for those in Band 3, the moderate-income category, is 80% of AMI, or $64,160. Rent for a two-bedroom would be $1604.

Midpoint for those in Band 4, a middle-income category, is 120% of AMI, or $96,240. That translates into $2406 for a two-bedroom.

Midpoint for those in Band 5, the higher middle-income category, is 150% of AMI, or $120,300. Monthly rent = $3007.50.

It makes you wonder what the market-rate units would cost. And it certainly suggests that the smaller market-rate units would be easier to rent.

B2FactSheetNov2011

Comments

Popular posts from this blog

Barclays Center/Levy Restaurants hit with suit charging discrimination on disability, race; supervisors said to use vicious slurs, pursue retaliation

The Daily News has an article today, Barclays Center hit with $5M suit claiming discrimination against disabled, while the New York Post headlined its article Barclays Center sued over taunting disabled employees.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with  referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

Behind the "empty railyards": 40 years of ATURA, Baruch's plan, and the city's diffidence

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At a hearing yesterday of the Brooklyn Borough Board Atlantic Yards Committee, Kate Suisma…

Barclays Center event June 11 to protest plans to expand Israeli draft; questions about logistics

At right is a photo of a poster spotted in Hasidic Williamsburg right. Clearly there's an event scheduled at the Barclays Center aimed at the Haredi Jewish community (strict Orthodox Jews who reject secular culture), but the lack of English text makes it cryptic.

The website Matzav.com explains, Protest Against Israeli Draft of Bnei Yeshiva Rescheduled for Barclays Center:
A large asifa to protest the drafting of bnei yeshiva in Eretz Yisroel into the Israeli army that had been set to take place this month will instead be held on Sunday, 17 Sivan/June 11, at the Barclays Center in Downtown Brooklyn, NY. So attendees at a big gathering will protest an apparent change of policy that will make it much more difficult for traditional Orthodox Jewish students--both Hasidic (who follow a rebbe) and non-Hasidic (who don't)--to get deferments from the draft. Comments on the Yeshiva World website explain some of the debate.

The logistical questions

What's unclear is how large the ev…

Atlanta's Atlantic Yards moves ahead

First mentioned in April, the Atlantic Yards project in Atlanta is moving ahead--and has the potential to nudge Atlantic Yards in Brooklyn further down in Google searches.

According to a 5/30/17 press release, Hines and Invesco Real Estate Announce T3 West Midtown and Atlantic Yards:
Hines, the international real estate firm, and Invesco Real Estate, a global real estate investment manager, today announced a joint venture on behalf of one of Invesco Real Estate’s institutional clients to develop two progressive office projects in Atlanta totalling 700,000 square feet. T3 West Midtown will be a 200,000-square-foot heavy timber office development and Atlantic Yards will consist of 500,000 square feet of progressive office space in two buildings. Both projects are located on sites within Atlantic Station in the flourishing Midtown submarket.
Hines will work with Hartshorne Plunkard Architecture (HPA) as the design architect for both T3 West Midtown and Atlantic Yards. DLR Group will be t…

Forest City acknowledges unspecified delays in Pacific Park, cites $300 million "impairment" in project value; what about affordable housing pledge?

Updated Monday Nov. 7 am: Note follow-up coverage of stock price drop and investor conference call and pending questions.

Pacific Park Brooklyn is seriously delayed, Forest City Realty Trust said yesterday in a news release, which further acknowledged that the project has caused a $300 million impairment, or write-down of the asset, as the expected revenues no longer exceed the carrying cost.

The Cleveland-based developer, parent of Brooklyn-based Forest City Ratner, which is a 30% investor in Pacific Park along with 70% partner/overseer Greenland USA, blamed the "significant impairment" on an oversupply of market-rate apartments, the uncertain fate of the 421-a tax break, and a continued increase in construction costs.

While the delay essentially confirms the obvious, given that two major buildings have not launched despite plans to do so, it raises significant questions about the future of the project, including:
if market-rate construction is delayed, will the affordable h…

Revising official figures, new report reveals Nets averaged just 11,622 home fans last season, Islanders drew 11,200 (and have option to leave in 2018)

The Brooklyn Nets drew an average of only 11,622 fans per home game in their most recent (and lousy) season, more than 23% below the announced official attendance figure, and little more than 65% of the Barclays Center's capacity.

The New York Islanders also drew some 19.4% below announced attendance, or 11,200 fans per home game.

The surprising numbers were disclosed in a consultant's report attached to the Preliminary Official Statement for the refinancing of some $462 million in tax-exempt bonds for the Barclays Center (plus another $20 million in taxable bonds). The refinancing should lower costs to Mikhail Prokhorov, owner of the arena operating company, by and average of $3.4 million a year through 2044 in paying off arena construction.

According to official figures, the Brooklyn Nets attendance averaged 17,187 in the debut season, 2012-13, 17,251 in 2013-14, 17,037 in 2014-15, and 15,125 in the most recent season, 2015-16. For hoops, the arena holds 17,732.

But official…

At 550 Vanderbilt, big chunk of apartments pitched to Chinese buyers as "international units"

One key to sales at the 550 Vanderbilt condo is the connection to China, thanks to Shanghai-based developer Greenland Holdings.

It's the parent of Greenland USA, which as part of Greenland Forest City Partners owns 70% of Pacific Park (except 461 Dean and the arena).

And sales in China may help explain how the developer was able to claim early momentum.
"Since 550 Vanderbilt launched pre-sales in June [2015], more than 80 residences have gone into contract, representing over 30% of the building’s 278 total residences," the developer said in a 9/25/15 press release announcing the opening of a sales gallery in Brooklyn. "The strong response from the marketplace indicates the high level of demand for well-designed new luxury homes in Brooklyn..."

Maybe. Or maybe it just meant a decent initial pipeline to Chinese buyers.

As lawyer Jay Neveloff, who represents Forest City, told the Real Deal in 2015, a project involving a Chinese firm "creates a huge market for…