With less demand for market-rate units, plus (possibly) new subsidies and (surely) extended deadlines, a different configuration for affordability?

From New York Post columnist Nicole Gelinas, 4/5/20, New York will need another federal bailout — and major belt-tightening:

With demand for office and market-rate residential space likely down, a surge in private-sector construction is unlikely to save the city this time, as it did after 9/11. Nor will global tourists save us soon.

If there's less demand for market-rate residential space, that raises a question about the next buildings for Atlantic Yards/Pacific Park. Under construction but paused are B4 (18 Sixth Avenue) and B15 (37 Sixth Avenue, 662-664 Pacific Street), slated to deliver 30% affordable units (at unspecified affordability levels), for a total of 352 apartments.

Slated to start this summer, at least according to pre-coronavirus predictions, are B12 and B13 (595 and 615 Dean Street), with at least 25% affordable units, or a total of 200 apartments. Surely that start time has been pushed back.

Changing the equation

But what if the latest crisis has changed the equation for these towers? B4 and B15 are already financed, while the financing is unclear for B12 and B13.

To speculate, it's not implausible that future city, state, or federal subsidies and/or financing programs would support a greater percentage of affordability, perhaps even "100% affordable" on the model of B14 (535 Carlton Avenue) and B3 (38 Sixth Avenue), with 50% of the units in the upper-middle-income band, below-market for new construction but competitive with some market-rate units.

That would make it easier for master developer Greenland Forest City Partners to meet the May 2025 deadline to deliver the required 2,250 units of affordable housing or, more likely, to meet a deadline that has been extended somewhat due to coronavirus.

In three towers (B2, B3, B14), there are 781 affordable apartments. With 352 plus 200 affordable units, under the previously announced plans, that would make a total of 1,333 apartments, leaving a gap of 917 units to reach the 2,250 requirement. 

What next?

That, I had assumed (based on documents filed with the state), would be addressed in the next three towers, built over the railyard. But maybe part of the gap would be addressed by reconfiguring the four pending buildings.

A few things to watch for:

• how much will the configuration of affordable housing continue to depart from that announced in 2005 (but not required contractually), with only 20% of the units in the upper-middle-income band?
• how much will that departure be attenuated if the project ultimately includes more than 2,250 affordable units, with a significant numerical chunk--even if a lower percentage than promised--of low- and moderate-income units?
• how would a deadline extension be calculated; would it be a simple straight-line extension based on when construction is further reopened (keeping in mind that construction of buildings with affordable units could continue right now)? or will there be a larger flex (which surely GFCP would want)?

Similarly delayed is the first phase (of two) of the deck for the Vanderbilt Yard, said vaguely to start this year. It's the precursor for three towers; under previously announced plans for the project, at least two and possibly three towers would be needed to deliver affordable units to meet the deadline.

But it's not implausible that only one tower might be needed, if the configuration of the other towers change. Or maybe it could all be accomplished without a railyard tower.

Stay tuned, it's a "never-say-never" project.

In the Post

An article in yesterday's New York Post, headlined Thousands of affordable apartments in limbo as ‘essential’ construction shuts down, stated:

Among the other developers that have chosen to temporarily stop construction are Greenland Forrest [sic] City Partners, which is building Pacific Park in Brooklyn... The controversial Pacific Park project is expected to yield 2,250 total below-market-rate apartments over the next five years.

That deserves some clarification. It was--and, for now, is--required to deliver a total of 2,250 affordable units by 2025, but I don't think many people expect that deadline to be met. Given the crisis, some extension is surely plausible.

Also, the phrasing "to yield 2,250 total below-market-rate apartments over the next five years" suggests that 2,250 such apartments would be built over the next five years, rather than that the total--with a large chunk already built--is supposed to be achieved by 2025.