Herrick Survey Reveals Key Findings Regarding Affordable New York Program
According to a survey conducted at Herrick's April 27 Real Estate Developers' Forum: How the Affordable New York Program Will Impact Developers,” 70 percent of owners and developers said they plan to take advantage of the program’s enhanced affordability option for new residential buildings with 300 or more rental units.
Under the new program, such projects south of 96th Street in Manhattan, and one mile from the East River in Queens and northern Brooklyn can received a 35 year-exemption from property taxes, provided they meet the program’s average hourly construction work wage requirement and one of three affordable housing requirements. During that 35-year period, property owners would only have to pay the “mini tax,” which is the assessed value of the site prior to construction.
64% of respondents also expressed concern that the Affordable New York’s slimmed down condominium options will hinder new condo development projects.
Respondents also said they expect to see the most development in 2017 in Long Island City. The South Bronx and Jersey City were chosen as the second and third areas likely to see the most development.
Optimism for the New York City-area commercial real estate industry in 2017 was an average of 6.4 out of 10 (a rating of 1 being least optimistic and 10 being very optimistic). Economic recession was identified as the most concerning issue in 2017, followed by constricted lending, rising interest rates and political uncertainty. “Less foreign investment” was the issue that respondents were least concerned about.