The numbers are not encouraging: Only 22 filings for multifamily foundation applications were submitted to the NYC Department of Buildings in February 2023 for 432 proposed units, according to recent data compiled by the Real Estate Board of New York.
The historically low number of filings follows a concerning trend we saw last year. There were 441 foundation filings in the first six months of 2022, followed by just 186 filings in the year’s second half. This steady decline began around the same time when the 421-a program expired on June 15 last year and never rebounded.
We’ve been working closely with state leaders to ensure they understand that without procurement reform, robust capital spending and removing barriers to build more housing, New York will continue to fall behind other states in the region. Without the proper tools to spur the development of affordable rental housing, it simply won’t get built. And so it now rests on the legislature to pass, and the governor to sign into law, housing policies outside of the budget process by the end of session in June. If they don’t act now, the housing crisis will only worsen and push middle-class families out of the city, further stalling our economic recovery.
An extension of the 421-a completion deadline by four years for projects that were approved before the program expired would cost the state nothing, and ensure that 33,000 new homes will be built, of which 8,200 are affordable. These units risk not meeting the current deadline due to financing and supply chain delays, putting their 421-a benefits at risk, jeopardizing the projects and further reducing our housing pipeline.
The governor’s executive budget also included a proposal calling for eliminating the outdated cap of 12 FAR that holds back our ability to meet the demand for housing. Removing the cap on density for residential development would encourage the construction of housing in high-opportunity areas that already have access to mass transit and job opportunities, as the Building Congress outlined in a recent report on Transit-Oriented Development. It would also trigger the city’s mandatory inclusionary housing requirements, paving the way to build housing that is truly affordable for New Yorkers.
Finally, judicious changes to state law would allow more large-scale conversions of commercial buildings to residential use. Older office buildings in Manhattan are struggling to compete with newer offices due to the impacts of the pandemic. Let’s reimagine them in a way that helps alleviate a different and far more pressing problem: lack of housing.
Some of our government leaders understand the urgency. The budget process showed that others are hesitating. But they have mere months left to take decisive action. Will New York continue its dangerous decline in housing production, or will we rewrite our future as a place that can be affordable, accessible and livable for all?
Carlo A. Scissura is president and CEO of the New York Building Congress.