Council Subcommittee Hears Application for Affordable Homeownership Project in Bedford-Stuyvesant

Image Rendering of proposed building at 816 Herkimer Street, Cluster 2 Image Credit: City Planning

HPD’s Open Door Program a key facet of Rochester Suydam application. On February 26, 2020, the City Council Subcommittee on Landmarks, Public Sitings and Dispositions heard the Department of Housing Preservation and Development and BJF Development’s application for the disposition of City owned property, the designation of an Urban Development Action Area and the approval of a property tax exemption under Article XI of the Private Housing Finance Law. The approval would facilitate the development of seven new buildings and 78 affordable homeownership units in the Bedford-Stuyvesant neighborhood of Brooklyn. The application was approved by the City Planning Commission on February 19, 2020. To read CityLand’s prior coverage of the Rochester Suydam project click here.

The seven proposed buildings are broken into three separate “clusters,” in a one mile radius between Fulton Street to the north, Atlantic Avenue to the south, Ralph Avenue to the east and Kingston Avenue to the west. The lots of the proposed developments are currently City-owned and vacant. Each cluster would be built according to the lot’s existing zoning designation— no rezoning is actually requested or required by the applicants or the proposed project. Cluster 1 will have two five-story buildings with ten units in each. Cluster 2 will have a four-story eight unit building, a four-story fifteen unit building, and a four-story twelve unit building. Cluster 3 would have a five-story ten unit building and a seven-story thirteen unit building. Of the 78 proposed units, 33 units are projected as one-bedroom units and 45 are projected as two-bedroom apartments.

Presenting for the applicants were Jack Heaney from the development team and Lin Zeng and Sarah Mallory from HPD. Heaney began the presentation by explaining that BJF Development is a joint venture with the Briarwood Organization, Fulcrum Architecture and Joe NYC. In describing the project, Heaney stated, “In a neighborhood where affordable homeownership opportunities are rare, HPD and the development team are excited about this project as it provides a unique opportunity to develop long-standing vacant and unutilized City-owned land with much needed affordable housing units.”

The development of the cooperative units will occur under HPD’s Open Door Program which helps fund new construction of cooperative and condominium buildings for moderate to middle-income individuals and families. Here, the project will be marketed to households from 80 percent Area Median Income to 110 percent Area Median Income. For a family of three, 80 percent AMI equates to approximately $76,880 per year.  According to Heaney “the majority [of units] will be two-bedrooms ranging from 80 to 100 percent AMI with more than one third set between 80 and 90 percent AMI.” Heaney added the one-bedrooms will range from $209,000 to $366,000 and the two-bedrooms will range from $254,000 to $452,000. As part of the Open Door Program, owners will be required to be owner-occupants of the units for the length of the regulatory period (40 years) and will have resale restrictions. The resale restrictions limit the homeowner to 2 percent appreciation per year of occupancy, and a mandate the homeowner to sell to a household within the project’s income limit.

Cluster Map Image Credit: City Planning

Contemplating the project’s overall affordability, HPD is also requesting approval of an Article XI tax exemption. The tax exemption will benefit the cooperative shareholders and run for the same 40 years as the Open Door regulatory period. According to the application team the tax benefit is approximately $1,918,968 with a net present value of $24,602. The requested Urban Development Action Area Project (“UDAAP”) designation also provides a tax emption as the development is for housing on formerly City-owned land.

Council Member I. Daneek Miller who represents District 27 in Queens had multiple questions for HPD regarding the Open Door Program and the marketing of the units. HPD explained the Open Door Program to the Council Member and stated that it is fairly new, having launched in 2018. Regarding the marketing of the units, the team said there will be a preference for the Bedford-Stuyvesant residents. The application team stated that the developers will work with their HDFC sponsor, New York Housing Partnership, who has over 30 years of experience marketing affordable house units. HPD also offered access to their Housing Ambassador program to assist in marketing the units.

Subcommittee Chair Adrienne E. Adams of District 28 in Queens commented on HPD’s recent efforts in Brooklyn, recognizing this project was too part of the agency’s trend of “creative planning” efforts. During Council Member Adams’ questioning she ascertained that the developers hoped to close on the properties by the end or summer or fall of 2020, construction would take approximately 24 months and it would take another 12 months to complete unit sales.

The Subcommittee is expected to vote on the application in the coming weeks.

By: Jason Rogovich (Jason Rogovich is the CityLaw Fellow and New York Law School Graduate, Class of 2019)



Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.