Photos provided by LIHC Investment Group.
The affordability of 243 rental apartments in the East Village has been locked in for 40 years under an agreement announced yesterday.
LIHC Investment Group recently struck a deal with the city to preserve the Section 8 properties known as “Lower East Side I and II Apartments” at 384 East 10th St. and 199 Avenue B. It was part of a larger agreement covering 669 units across the city. Under the terms of the deal, the buildings will receive tax abatements and new 40-year regulatory agreements. The property owners will also spend millions to renovate the buildings.
The 10th Street building includes 152 Project-Based Section 8 units. The property on Avenue B has 91 Project-Based Section 8 units. According to a press release, all of the apartments will be maintained as affordable to tenants whose annual income does not exceed 50 percent of Area Median Income (AMI is $93,900 for a family of three). Currently, the properties are 100% leased. As units become vacant, they will be made available to low-income families. The agreement requires the owners to set aside 20% of the units for homeless individuals and families.
The building owners, LIHC and Center Development Corporation, will be making $7 million in improvements, including kitchen and bathroom upgrades, new wood flooring and new lighting.
The city’s Department of Housing Preservation and Development (HPD) and the New York City Housing Development Corporation worked with the owners to preserve the affordable apartments under the mayor’s Housing New York Plan. In a statement, HPD Commissioner Maria Torres-Springer called the deal, “a victory for both residents and neighborhoods that benefit from the stability that comes from extended affordability.”
Andrew Gendron of LIHC said, “This deal will preserve existing affordable housing in neighborhoods where it is under the greatest threat, and we are proud to provide residents with an improved living environment, stable housing, and peace of mind far into the future.”
Local City Council member Carlina Rivera added, “The development and preservation of affordable housing is my top priority as a Council Member, which is why I am so proud to have helped LIHC Investment Group and HPD reach an agreement that will preserve nearly 250 units of affordable housing at 384 E. 10th St. and 199 Avenue B. For the next 40 years, these residents will continue to be able to live and contribute to our rich and diverse neighborhood, and I want to thank all of the stakeholders, as well as my predecessor Councilwoman Rosie Mendez, for their work on this negotiation.”
As the Real Deal noted, the apartments are being preserved under the state’s Article XI, which requires deeper affordability than the better known 421-a subsidy program. Maine-based LIHC is one of the largest affordable housing firms in the nation, with an ownership interest in more than 37,000 units.
Every year, the Association for Neighborhood & Housing Development (ANHD) publishes a report, “How is affordable housing threatened in your neighborhood?” The organization tracks a variety of indicators to come up with a profile in each community board. It’s not a perfect snapshot of what’s happening in the housing market, since statistics can’t tell us everything, but it’s still a useful tool. Let’s take a look at some of the stats for Community Board 3, which includes the Lower East Side, most of Chinatown and the East Village.
–In 2016, the most recent year statistics were available, Community District 3 included 18,062 rent stabilized apartments. That’s considerably lower than some other Manhattan neighborhoods, including the Upper East Side and Upper West Side. But the neighborhood has more rent stabilized housing than the Financial District and Greenwich Village.
–1,157 apartments on the Lower East Side are at risk of losing their HUD-supported subsidies by 2022. Most of the endangered units of this type citywide are located on the LES, the Upper West Side and in East Harlem.
–The price per square foot of apartments sold on the Lower East Side from 2015-2017 rose by 8.4%. In comparison, it went up a whopping 42% in the Financial District but fell 27% in the Village.
–2,002 new apartments were created in CB3 during 2017 (based on certificates of occupancy issued). As ANHD noted, “Fast-paced residential development can put pressure on existing residents by increasing land values and rents. In Manhattan, the top neighborhoods with new residential units approved are Midtown, Clinton/Chelsea, and the Lower East Side/Chinatown – over 1,000 units in each of those districts in 2017 alone.”
–The Lower East Side’s “Threat to Affordable Housing” overall score was 16, second highest in Manhattan. The highest scores citywide were concentrated in the Bronx.
In a statement, ANHD Executive Director, Benjamin Dulchin said, “The crisis of affordable housing is so much part of the daily experience of almost all New Yorkers that it’s the water we swim in. But some people and some neighborhoods are experiencing the crisis and the displacement pressure more severely, and with more devastating consequences to their families and their communities. This year’s Housing Risk Chart shows the many ways and many neighborhoods where City policy must do a better job preserving our affordable housing.”
You can see the full report here.
Protest outside Signature Bank meeting, April 25, 2018. Photos courtesy of ANHD.
Activist groups in New York City have a long history of fighting back against landlords intent on pushing out rent stabilized tenants. In the past couple of years they’ve also been going after banks that help developers purchase vulnerable rent regulated buildings. Case in point: a protest staged last month in Midtown Manhattan, where Signature Bank was holding its annual shareholder meeting.
Tenants from across the city and members of advocacy groups, carried signs with slogans like, “Don’t underwrite displacement,” and called on Signature to, “fully adopt responsible lending practices to protect tenants’ rights.”
Signature is not the only bank targeted by activists, but it has been a main focus of their campaign during the past year. In protracted negotiations with bank officials, they have pressed for commitments to stop granting loans that put rent regulated residents at risk of displacement and to monitor unsafe construction practices. Tenant leaders say Signature has made some concessions but has not gone nearly far enough.
One of the groups leading the charge on the issue is the Association for Neighborhood & Housing Development (ANHD). In a statement, ANHD’s Jaime Weisberg said, “When banks make loans that are too large for the current rents to support, landlords have even more reason to find all possible ways to raise rents – legal, semi-legal, or illegal – all unscrupulous… We have seen this again and again. Banks may not be the only problem in these situations, but they are definitely part of the problem, and should instead become part of the solution.”
Among those attending last month’s rally was State Assemblyman Harvey Epstein, a longtime tenant advocate.
Another organization involved in the coalition is the Cooper Square Committee, which is on the front lines advocating for tenants on the Lower East Side. Several property owners with buildings in the neighborhood — including Icon Realty Management, Jared Kushner and the Sabet Group — have Signature loans.
This past fall, Sabet picked up a 20-unit walkup building at 61 East 7th St. for $8.3 million. It was not long after the transaction took place that counselors at Cooper square Committee began hearing from tenants about disruptive renovation projects in the building and questionable buyout offers. According to public records, Signature provided the Sabet Group with a loan in the amount of $6.375 million, raising suspicions among tenants that they were now living in an over-leveraged building. They grew more concerned after learning about previous legal battles between Sabet and tenants living in Chelsea.
Earlier this spring, the Tenant Harassment Protection Task Force paid a visit to the building, which resulted in a partial stop work order. In a March 23 letter to executives at Signature Bank, the tenant association detailed various problems, including the discovery that fire stopping was not used during building renovations. “Our association,” they wrote, “has been monitoring and logging the unsafe breathing levels in apartments… with soot and debris continuing to infiltrate our homes.” The tenants pleaded with the bank executives, “Please consider in the future the consequences of the money you lend to landlords (with questionable track records).”
Yonatan Tadele, a housing coordinator at Cooper Square Committee, told The Lo-Down, “Whenever rent-regulated buildings are being financed, Signature Bank must improve their lending standards across the board – from initiating loans, to dealing with problems that arise in buildings currently financed by the Bank.”
In December, Signature Bank came out with a statement, which was titled, “Our Pledge to the Community.” Among other points, Signature asserted, “The Bank’s underwriting for multi-family loans considers cash flow projections based on in-place rents and market rate projections for vacant apartments.”
“In the event building conditions affecting safety or quality of life are brought to the Bank’s attention,” the bank noted, “we will work diligently to encourage our borrowers to ameliorate those conditions.” In a statement provided to WNYC last year, Signature said, “No one and no bank is perfect. But our overall record should be applauded and not denigrated. We note some of the names in question and have worked toward encouraging positive outcomes for tenants to the extent legally possible.”
But Cooper Square Committee pointed out that Signature has still not reached and agreement with tenants and advocacy groups. The pledge, said Yonatan, “falls short of a number of key items; namely, specific protections to prevent tenant displacement and utilizing responsible tenant engagement. One such protection that would’ve made a lasting difference at 61 East 7th Street is having a defined policy that would prevent hazardous construction and ensure tenants’ safety.”
96 Baxter St.
It has been 25 years since the waiting list was open for this building, a 13-story rental tower for low-income seniors at 96 Baxter St. Today the Chung Pak Local Development Corp. in Chinatown is finally reopening the list and accepting applications.
Officials with the organization made the announcement at a news conference yesterday in the 13th floor community room. The building is operated through Chung Pak’s elderly housing branch, Everlasting Pine HDFC. The 88-unit project is supported through the federal Department of Housing and Urban Development’s Section 202 senior supportive housing program.
The original waiting list contained well over 3,000 names, but has dwindled to a handful. Only people aged 62 and older and mobility impaired applicants over the age of 18 may apply to join the waiting list. In order to qualify for a studio apartment, applicants must have an annual income of $33,400 or less. The limit is $38,200 for 1-bedroom apartments. Eligible tenants pay 30% of their annual income. Applications will be available at the building beginning today (you must bring an index card with your contact info). You can also mail a request for an application to: Everlasting Pines HDFC, 96 Baxter St. New York, NY, 10013. Applications must be postmarked by Sept. 5.
Present at yesterday’s media event were Chung Pak LDC’s acting chairman, Sherman Eng; Director of Operations Jacky Wong; board members; and community leaders. City Council member Margaret Chin and Virginia Kee, founder of the Chinese American Planning Council reminisced about the fight to build the senior housing project in the early 1980s. Kee and Chin were both on the front lines during large protests against the Koch Administration’s plan to build a jail on the site. The jail was built, but a portion of the property was set aside for the low-income building.
Two tenants living in the building are 108, said Eng, while the youngest residents are around 85. One apartment, a 1-bedroom unit, is currently vacant.
Photo: Office of Council member Margaret Chin. Bill signing, 2015.
During the lunch hour today, Mayor de Blasio and local City Council member Margaret Chin will be participating in a “telephone town hall meeting” on the topic of affordable housing for seniors. See the invitation below. If you would like to take part, call 877-215-4765, pin 250. The event begins at 12:15 p.m. Chin is involved because she chairs the City Council’s aging committee.