HPD Proposes Affordable Homeownership Project in Bedford-Stuyvesant

Rendering of Proposed Development at 35-37 Rochester Avenue Image Credit: City Planning

Affordable homeownership project receives generally positive feedback. On January 22, 2020, the City Planning Commission heard an application by the Department of Housing Preservation and Development for the disposition of city-owned property and to designate three areas in the southern portion of Bedford-Stuyvesant, Brooklyn as Urban Development Action Areas. The UDAAP designation would help facilitate the construction of seven new buildings and 78 affordable homeownership units. Felipe Cortez, a borough planner at HPD and Jack Heaney from Fulcrum Properties presented the application.

Development and Area

The proposed cooperative units are broken into 3 developments which the application team referred to as “clusters.” The clusters are generally located between Fulton Street to the north, Atlantic Avenue to the south, Ralph Avenue to the east and Kingston Ave to the west. The area is predominantly residential with some commercial retail spaces along Fulton Street and some industrial uses along Atlantic Avenue. The applicants purport the area is well served by public transportation, with a subway line at least a quarter mile from each cluster.

In designing all 7 properties the developer studied the existing neighborhood through historic maps and photos. Ultimately, the buildings will incorporate elements of masonry with window openings that match the surrounding buildings. All buildings have access to a recreational rear-yard common areas, bike storage, and elevators. Individual units feature open kitchen and living room designs, oversized front windows for increased light and air and individual dishwashers, washers and driers. The applicants were also proud to announce that each building will have high efficiency VRF systems for heating and cooling and will be built to sustainable standards.

Cluster Breakdown

  • Cluster 1 is zoned R6A which permits medium density residential use. In this cluster the developers plan to build two five-story buildings with ten units in each. One building is located at 421-423 Herkimer Street and the other at 440-444 Herkimer Street.
  • Cluster 2 is zoned R6B which permits medium density residential uses and is usually mapped on narrow streets. The applicants seek to build three buildings in this cluster; one four-story, eight unit building at 35-37 Rochester Avenue, one four-story, fifteen unit building at 18-22 Suydam Place, and one four-story, twelve unit building at 816 Herkimer Street.
  • Cluster 3 is zoned R6B and R7D, the latter of which allows slightly more height and development space than the other R6 designations and clusters. In this cluster the applicants seek to build two buildings; one five-story, ten unit building at 329-221 Ralph Avenue and one seven-story, thirteen unit building at 335 Ralph Avenue.

The 78 units will be offered to household earners between 80 percent and 110 percent Area Median Income (“AMI”). According to the applicants, the majority of units will be offered at 100 percent AMI. 100 percent AMI equates to approximately $96,100 per year for a family of three. The applicants plan to offer thirty-three one bedroom units and forty-five two bedroom units. Most ground floor units are one-bedroom units, raised above ground level for added privacy.

Cluster Map Image Credit: City Planning

Land Use Requests

HPD is requesting the disposition of 13 vacant, city-owned properties and that those properties receive Urban Development Action Area and Urban Development Action Area Project (“UDAAP”) designations. UDAAP designations provide tax exemptions (for up to 20-years) for either new construction or the rehabilitation of housing on formerly city-owned land.

The proposed developments will also utilize HPD’s Open Door Program and term sheet. The Open Door program funds new construction of cooperative and condominium buildings for individuals at affordable to moderate- and middle-income families. To accomplish this end, HPD will issue Capital funds to a Housing Development Fund Corporation (“HDFC”) to construct the buildings. The amount of subsidy will be based on the affordability of the units offered to prospective buyers. Upon completion of the building, the HDFC or an HDFC in partnership with a private development entity will sell units to households who agree to occupy the units for the length of the regulatory period. In this case, it would be forty years. If the purchaser sells or refinances during the regulatory period they can realize up to two percent appreciation on the original purchase price per year of occupancy. If the unit is resold, the new purchaser would also have to qualify for the project’s income cap.  All projects in the Open Door Program must apply for a tax exemption. In this case, the applicants are applying for UDAAP and an Article 11 tax exemption. Article 11 tax exemptions are also offered to HDFCs building low income housing.

Commission Comments

Commission Member Anna Hayes Levin asked a slew of questions about how HPD planned to set up the ownership entities and how resale of the units would function. Joyce Kwon, Deputy Director of HPD’s Open Door Program, explained that three separate cooperatives would be set up for each of the three clusters. Kwon also explained that HPD is working to find a way to educate future owners/shareholders on the responsibilities for managing a Cooperative Board. That includes enforcing good governance, board limitations, building maintenance and assessing capital needs.

Brooklyn Community Board 3 approved the application by a vote of 37 to one and Brooklyn Borough President Eric Adams approved the applications with modifications. Borough President Adams supports the use of underutilized land for productive uses, like affordable housing and homeownership. Although, Adams stresses that the redevelopment of City-owned properties should remain permanently affordable, and not capped at 40 years. Adams believes that permanently affordable housing can be secured through mechanisms in the Zoning Resolution or share-equity homeownership programs through community land trusts or deed restrictions. Adams would also like to see additional units at the 80 and 90 percent income band and the incorporation of sustainability measures for each of the buildings.

If ultimately approved, the applicants hope the developments will be completed by summer 2022.

City Planning will vote on this application on a later date.

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



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