Tuesday, July 17, 2012

Decoding first Atlantic Yards tower: "affordable" 2-BR rents from $726 to $3,112, murky financing plan, 20K square feet of "arena storage"

The New York City Housing Development Corporation (NYC HDC) has passed along some cursory information regarding plans for the first Atlantic Yards residential tower, aka B2, the 32-story, 363-unit subject of a public hearing tomorrow at 1 pm.

There's no information on the agency web site. I was told I would have to file a Freedom of Information Law request for underlying documents, which will not be available for perusal tomorrow.

However, the agency did send a two-page fact sheet, which bears significant similarity to two previous fact sheets (below) prepared by consultants for Forest City Ratner, but don't necessarily provide useful information to those who may wish to comment publicly tomorrow.

The agency may provide up to $92 million in bonds, part of a financing plan that includes Low Income Housing Tax Credits, HDC Second Mortgage & Developer Equity. But it's not clear what the mix would be.

Here are the highlights:
  • There's no mention if the building will be modular.
  • A subsidized 2-BR unit in the lowest range of affordability should rent for $726,25.
  • A subsidized 2-BR unit in the midrange of affordability should rent for $1,660/mo.
  • A subsidized 2-BR unit in the highest range of affordability should rent for $3,112.50/mo.
  • Of the affordable units, 20% will be 2-BR units, though developer Forest City Ratner's agreement with ACORN pledged 50% (in floor space) devoted to family-size units.
  • The building is heavily weighted to smaller units, perhaps because more transient singles/couples would agree the location trumps living over an arena.
  • The building will offer 20,000 square feet of "arena storage."
Where's the market?

Those least-affordable subsidized units are clearly within the range of market rent. A search on Streeteasy for two-bedroom apartments in Fort Greene and Park Slope showed the median rent at $2,987.

Similarly, a search on Streeteasy for two-bedroom apartments in Fort Greene and Park Slope showed the median rent at $2,450, below the $2,490 rent of the least-affordable subsidized units.

Unit mix

The building would contain approximately 150 studios (41%), 165 1-BR (46%) and 48 2-BR (13%).

If 20% of the 181 affordable units will be 2-BR/2-BA apartments, that means 36 of the 48 2-BR units will be subsidized, with approximately seven units for each of five income "bands," from low-income to middle-income.

In March, Forest City executive Jane Marshall said there'd be 35, an increase from the previous pledge of 20, but still well below the pledge in the Memorandum of Understanding signed with ACORN. The developer's partner is now Mutual Housing Association of New York (MHANY), an ACORN successor.

Tenants will be selected through a City-administered lottery process, according to the fact sheet. Unmentioned, but previously pledged, is that residents of the three adjoining community districts will get a preference.

Amenities

As in previous announcements, the building will offer a 24-hour doorman, fitness center, secure bike storage, resident lounge, and roof terrace. Added in the latest announcement are a game room, yoga/dance studio.

Also, each apartment will have a washer and dryer.

Retail & storage

As mentioned previously, there will be approximately 4,000 sf of retail on the ground floor, enough for several small stores.

Unmentioned previously is a plan to offer 20,000 sf of arena storage in the cellar and base of B2. The purpose isn't clear.

Monthly rents

Rent is based on Area Median Income (AMI), which encompasses not just New York City but affluent suburban counties. The current AMI is $83,000 for a family of four.

As indicated in the graphic at right, some 40% of the affordable units (and 20% of the building) would be low-income, up to 50% of AMI.

The rest would be evenly divided among three moderate- and middle-income bands.

"Affordable" simply means a household pays 30% of its income in rent. Based on previous documents, I've calculated rent at the midpoint of the band, not the top. So, for example, rent in Band 3 is calculated at 80% of AMI. These are unofficial calculations.

For a four-member household in a 2-Bedroom, these are the rents:
  • Band 1: $726.25
  • Band 2: $933.75
  • Band 3: $1,660
  • Band 4: $2,490
  • Band 5: $3,112.50
For a four-member household, these are the income ranges:
  • Band 1: $24,900 / $33,200
  • Band 2: $33,200 / $41,500
  • Band 3: $49,800 / $83,000
  • Band 4: $83,000 / $116,200
  • Band 5: $116,200 / $132,800
One-bedroom units

For a two-member household in a 1-Bedroom, the rent/income, as per a 2006 Forest City Ratner document, was adjusted at 80% of a four-person household:
  • Band 1: $581
  • Band 2: $795
  • Band 3: $1328
  • Band 4: $1992
  • Band 5: $2490
For a two-member household in a 1-Bedroom, these are the income ranges:
  • Band 1: $19,920 / $26,560
  • Band 2: $26,560 / $33,200
  • Band 3: $39,840 / $66,400
  • Band 4: $66,400 / $92,960
  • Band 5: $92,960 / $106,240

Atlantic Yards B2 Fact Sheet July 2012
B2FactSheetNov2011 B2 Fact Sheet May 2008

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