NYCHA Lots to Be Used For Luxury Housing

photo: NY Daily News
photo: NY Daily News

In an extremely controversial move, NYCHA Chairman John Rhea announced his plan to lease “unused” space on NYCHA lots to build luxury housing developments. The “unused” space for the developments are currently parks, baseball diamonds, and parking lots. Initially, this plan would involve eight NYCHA lots in Manhattan.

NYCHA faces a desperate fiscal situation, which is unlikely to improve on its own. According to City Limits, NYCHA faces a yearly deficit of $40 million in operating costs and $6.6 billion in capital needs.  The money raised by leasing up NYCHA spaces would be used to provide much needed repairs and maintain the 334 public housing developments throughout the city.  John Rhea describes the plan as necessary for the stability of the large housing authority.

However, elected officials are calling on the city to delay plans for moving forward, particularly because they – as well as tenant leaders and community members—have been widely left in the dark.  The city is due to receiving requests for proposals from developers this month.

As part of the plan, the luxury apartments would need to be twenty percent “affordable,” though as we’ve seen in other recent development projects, “affordable” in this context is not necessarily “affordable” to a low-income family. The eighty percent remaining units would be “market rate.”  In the proposed booming neighborhoods like the Lower East Side, market rate rents are extremely high.

As a result  of the “mixed income” aspect of the new apartment buildings, the developers would be given a 35 year tax credit. It is hard to imagine how luxury apartments built on city property would be exempt from paying taxes – isn’t the point of Rhea’s plan to increase the flow of money into city government? According to Eliot Sclar, the Director of the Center for Sustainable Urban Development (CSUD) at Columbia University’s Earth Institute:

That is the tax deal given to developers on private land…In this case, they are privatizing public resources; they should leverage it much more.

This issue of privatizing public land highlights a much larger issue – the privatization of previously public entities, such as housing and education (through charter schools). With this trend, corporations and companies are exerting greater and greater control over the ways that we receive our basic rights, such as housing or education. While this might not appear problematic initially, it becomes detrimental when education or housing is simply about making a profit for a company. What happens when that endeavor is no longer profitable?

We see this issue all the time in private multifamily buildings we work in. Private, predatory developers buy-up regulated housing for the sole purpose of making a buck.  (Or several bucks.) When it becomes apparent that a property is not profitable, the owner ceases to take an interest in the day-to-day living conditions for tenants and ignores basic needs such as heat and hot water.

Current NYCHA tenants have many legitimate fears about NYCHA’s plan to build luxury departments on their lots. First and foremost, tenants fear being pushed out of their neighborhoods and homes.  City Limits published an article this week highlighting social costs of this proposal. One tenant interviewed by City Limits, Aixa Torres, lives in the Smith Houses on the Lower East Side and speaks to her concern of hardening class divisions though this development plan:

Torres says she has already experienced what happens when outsiders wander into Smith Houses. “They don’t pick up after their dogs. People disrespect us. We’ll be treated as second class citizens in our own home.”

NYCHA tenants need to be given a voice in what happens to their homes, and they are calling on the agency to address their concerns about leasing to luxury developers before the plan moves forward. At the moment, tenants fear their rent will go up, that they will soon be displaced through continued city-wide pushes towards gentrification, and increased class and social divisions.  As community activists, organizers, and residents of New York City, our goal should be to make sure that tenants have a say in what happens to their homes. Without that say, anything could happen. Even luxury apartments being built on NYCHA lots.

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