This is among several articles to be posted regarding the 10/17/17 meeting of the Atlantic Yards Community Development Corporation (AY CDC).
With Atlantic Yards/Pacific Park, most deadlines are flexible, we should remember.
Just one month ago, at the bi-monthly Quality of Life meeting, Forest City New York executive Ashley Cotton--representing the joint venture Greenland Forest City Partners--said of the fourth tower in the project, 38 Sixth Avenue (aka B3), "we’re hoping for move-ins to start in October."
Yesterday, however, Cotton told the board of the AY CDC that interior work at the building was ongoing and “move-ins are expected to begin later in November." She noted that the 67-space garage will be run by Park Pro Systems; as of last month, they didn't have a garage operator.
The developer is currently working on the "fit-out" for the health space to be operated by Methodist Hospital, and is working with the Downtown Brooklyn Neighborhood Alliance--the most active remaining signatory of the Community Benefits Agreement--on that space. (Some portion should be geared to low-income households, but the budget and funding source remains unclear.)
Enough demand for middle-income "affordable housing"?
For "100% affordable" 38 Sixth, there were "almost 90,000 applications" for the lottery, Cotton said. "We are steadily working through them."
However, the question remains as to whether that large group, surely (as past results suggest) skewed to low-income households, will deliver enough takers for the 152 units in the 303-unit building that are geared to middle-income households, as indicated in the screenshot below. Studios will rent for $2,121, 1-BRs for $2,663, 2BRs for $3,206, and 3-BRs for $3,695.
Cotton brought to the meeting "a big stack of flyers" advertising the remaining middle-income affordable units, which were not filled during the lottery.
"For those who don’t understand the process, basically, once you have exhausted all approximately 100,000 people [actually: 92,743] who applied through the lottery and haven’t filled every unit, you turn to what’s called open marketing," Cotton said, which means anyone in within the appropriate income categories is eligible.
She encouraged attendees to share the information.
"Does that mean that with all the people who applied for the lottery, you didn’t get enough applicants," asked AY CDC board member Linda Reardon. "How were they screened out?"
"So, let’s call it 100,000 applications," Cotton responded. "Some people drop out because they’re not interested, others drop out because they’re not qualified, or don’t have the right documentation."
That was a rather backhanded way to say that, of the huge numbers who applied for 535 Carlton, only 2,203 made the first cut for the 148 middle-income units, which represents half the building.
"In this case they’re all what we call Band 5, it’s the highest-income band" within the building, Cotton added, noting they were middle-income units that were affordable and rent-stabilized. "There were clearly not enough people applying in certain income levels to match the number of units we have." (Here's the breakdown of units.)
Competing with the market?
Board member Barika Williams, Deputy Director at the Association for Neighborhood and Housing Development, asked how Band 5 rents compare to market rents within a half-mile radius.
Cotton said she didn't have that information.
"You guys probably are doing cost analysis of the general area, of everything else that’s coming online," Williams said. "From my knowledge, I think $2,100 for a studio is not that far off market rate." (She's right; after a price drop, one market-rate studio at 461 Dean, a hybrid 50% affordable building within the project, dipped below the price of a studio at 535 Carlton.)
Williams asked how about the impact of affordable units "pretty darn close to market rate rents"?
"You’re asking a policy question," Cotton replied a little standoffishly. "I don’t make the policy." (Well, the developer certainly has negotiated with the city on the configuration of rents in this project, as I reported regarding 461 Dean.)
"I’d say there is a education process that needs to happen with people who don’t think affordable housing applies to them," she said. "It’s a public policy program being executed by us that was done by the city."
"I'm not saying it’s your fault," Williams said, but she noted that if a similar unit was available without having to go through the application process, buyers might take the latter.
"Units at 461 Dean are more expensive," Cotton said. "There’s definitely a discount here."
Indeed, as I wrote last month, a $2,680 affordable 1-BR at 535 Carlton was then just 13% below the least-expensive current market-rate 1-BR at 461 Dean, advertised at $3,081 "net effective rent," given a couple of free months on a lease.
Today the gap has narrowed: the least-expensive market-rate 1-BR at 461 Dean is $2,995 "net effective rent," which is just 10.5% below an affordable 1-BR at 535 Carlton.
That said, the "net effective rent deal," common when there's a glut of units, won't last forever. Beyond pricing, added Tobi Jaiyesimi, the Atlantic Yards project director for Empire State Development as well as Executive Director of the AY CDC, the affordable housing offers long-term affordability and rent stabilization.
"I hear you," said Williams, but she added that many units in the area, as long as they took advantage of the 421-a tax break, offer rent stabilization as well, with market-rate units that see limited rent increases.
With Atlantic Yards/Pacific Park, most deadlines are flexible, we should remember.
Just one month ago, at the bi-monthly Quality of Life meeting, Forest City New York executive Ashley Cotton--representing the joint venture Greenland Forest City Partners--said of the fourth tower in the project, 38 Sixth Avenue (aka B3), "we’re hoping for move-ins to start in October."
Yesterday, however, Cotton told the board of the AY CDC that interior work at the building was ongoing and “move-ins are expected to begin later in November." She noted that the 67-space garage will be run by Park Pro Systems; as of last month, they didn't have a garage operator.
The developer is currently working on the "fit-out" for the health space to be operated by Methodist Hospital, and is working with the Downtown Brooklyn Neighborhood Alliance--the most active remaining signatory of the Community Benefits Agreement--on that space. (Some portion should be geared to low-income households, but the budget and funding source remains unclear.)
Enough demand for middle-income "affordable housing"?
For "100% affordable" 38 Sixth, there were "almost 90,000 applications" for the lottery, Cotton said. "We are steadily working through them."
However, the question remains as to whether that large group, surely (as past results suggest) skewed to low-income households, will deliver enough takers for the 152 units in the 303-unit building that are geared to middle-income households, as indicated in the screenshot below. Studios will rent for $2,121, 1-BRs for $2,663, 2BRs for $3,206, and 3-BRs for $3,695.
Cotton brought to the meeting "a big stack of flyers" advertising the remaining middle-income affordable units, which were not filled during the lottery.
"For those who don’t understand the process, basically, once you have exhausted all approximately 100,000 people [actually: 92,743] who applied through the lottery and haven’t filled every unit, you turn to what’s called open marketing," Cotton said, which means anyone in within the appropriate income categories is eligible.She encouraged attendees to share the information.
"Does that mean that with all the people who applied for the lottery, you didn’t get enough applicants," asked AY CDC board member Linda Reardon. "How were they screened out?"
"So, let’s call it 100,000 applications," Cotton responded. "Some people drop out because they’re not interested, others drop out because they’re not qualified, or don’t have the right documentation."
That was a rather backhanded way to say that, of the huge numbers who applied for 535 Carlton, only 2,203 made the first cut for the 148 middle-income units, which represents half the building.
"In this case they’re all what we call Band 5, it’s the highest-income band" within the building, Cotton added, noting they were middle-income units that were affordable and rent-stabilized. "There were clearly not enough people applying in certain income levels to match the number of units we have." (Here's the breakdown of units.)
Competing with the market?
Board member Barika Williams, Deputy Director at the Association for Neighborhood and Housing Development, asked how Band 5 rents compare to market rents within a half-mile radius.
Cotton said she didn't have that information.
"You guys probably are doing cost analysis of the general area, of everything else that’s coming online," Williams said. "From my knowledge, I think $2,100 for a studio is not that far off market rate." (She's right; after a price drop, one market-rate studio at 461 Dean, a hybrid 50% affordable building within the project, dipped below the price of a studio at 535 Carlton.)
Williams asked how about the impact of affordable units "pretty darn close to market rate rents"?
"You’re asking a policy question," Cotton replied a little standoffishly. "I don’t make the policy." (Well, the developer certainly has negotiated with the city on the configuration of rents in this project, as I reported regarding 461 Dean.)
"I’d say there is a education process that needs to happen with people who don’t think affordable housing applies to them," she said. "It’s a public policy program being executed by us that was done by the city."
"I'm not saying it’s your fault," Williams said, but she noted that if a similar unit was available without having to go through the application process, buyers might take the latter.
"Units at 461 Dean are more expensive," Cotton said. "There’s definitely a discount here."
Indeed, as I wrote last month, a $2,680 affordable 1-BR at 535 Carlton was then just 13% below the least-expensive current market-rate 1-BR at 461 Dean, advertised at $3,081 "net effective rent," given a couple of free months on a lease.
That said, the "net effective rent deal," common when there's a glut of units, won't last forever. Beyond pricing, added Tobi Jaiyesimi, the Atlantic Yards project director for Empire State Development as well as Executive Director of the AY CDC, the affordable housing offers long-term affordability and rent stabilization.
"I hear you," said Williams, but she added that many units in the area, as long as they took advantage of the 421-a tax break, offer rent stabilization as well, with market-rate units that see limited rent increases.
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