Can NYCHA Be Saved?

David Goldsmith

All Powerful Moderator
Staff member
Things got so bad at NYCHA that a Federal monitor was appointed for oversight. There have been moves to bring in various private entities through programs like RAD (Rental Assistance Demonstration). Now The Related Companies is taking its shot.

Related wades into NYCHA — and becomes a target​

Hudson Yards developer will oversee $366M in repairs to public housing​

Related Companies is the latest private landlord to sign up for fixing New York City Housing Authority buildings — and for the disdain of activists who object to what they call privatization.
The New York-based company, in a joint venture with Essence Development, will carry out $366 million worth of repairs at over 2,000 NYCHA units in Chelsea. The entry into the public housing arena is a departure for Related, which is known for posh projects, although it has developed private affordable housing.

Under the Permanent Affordability Commitment Together initiative, or PACT, the developer will finance the improvements with future rental income from the apartments. The city makes that possible by shifting tenants’ primary rent subsidy to Section 8, a reliable federal funding stream against which developers can borrow.

The strategy has its own acronym, RAD, for Rental Assistance Demonstration. The de Blasio administration was so pleased with the initial RAD projects that it resolved to use it as much as possible to chip away at NYCHA’s $40 billion repair backlog.
Yet one band of critics remains convinced that bringing private interests such as Related into NYCHA will end badly for tenants.

“The #HudsonYards developer will annex public housing in Chelsea in order to clear it out,” Fight For NYCHA tweeted Wednesday morning upon learning that Related would take over repairs at Fulton, Chelsea, Chelsea Addition and Elliott Houses.
The group’s use of verbs like “annex” infuriates NYCHA, which has spent several years assuring tenants it retains ownership of the properties and that they will remain public housing, where rent cannot exceed 30 percent of a tenant’s income.

Opponents also rankle tenant leaders who see the program as an answer to the maintenance nightmare that NYCHA has failed for decades to solve on its own.
Miguel Acevedo, president of the Fulton Houses Tenant Association, a part of the working group organized to discuss the future of the Chelsea NYCHA developments, denounced Fight For NYCHA’s claims, saying the group was not present at meetings with Essence and Related and did not hear “what they had to say.”

“Instead they tweet outlandish and false accusations to stir up baseless fear,” Acevedo said in a statement. “We — NYCHA residents — are thrilled about this upcoming partnership with Essence and Related.”

Louis Flores, the tenant activist behind the opposition group, said NYCHA residents may have been misled by developers and lawmakers to believe the partnership would be beneficial. He claims Related could push out residents, demolish the buildings — five of which are high-rises — and redevelop the space.

“First of all, it’s very suspicious that the Related Companies would even bother with public housing since they are a luxury developer,” he said. “Secondly, given all the gentrification that has taken place in Chelsea and Hudson Yards, it’s not a surprise that they would want to get rid of public housing.”

But there is no plan to get rid of public housing. NYCHA officials have repeatedly assured that such a scenario cannot happen under the partnership program.
An early plan for the Chelsea PACT conversion called for demolishing two Fulton Houses buildings and replacing them with one larger tower, Politico reported. A working group later scrapped the recommendation.

However, Flores hypothesized that Related’s engineers could find it economically unfeasible to rehabilitate the building and recommend a demolition anyway.
“Just because they say they’re going to do something doesn’t make it true,” Flores said. “Just because they claim tenants are protected doesn’t make it true. That’s not what happened at Ocean Bay.”

Ocean Bay, in Queens, was the first NYCHA development to go through the rehabilitation program and is often cited by the agency as an example of how well it works. The Housing Authority even made a glowing video about it.
After private developers took over Ocean Bay Houses in Far Rockaway, the program’s flagship development, 80 households were evicted over the next 26 months — more than double the next highest development, City Limits reported in 2019.

But NYCHA said City Limits greatly overstated the number. And an executive for the management group, Wavecrest, told the publication that it “dutifully follows the official grievance procedures as outlined by the RAD program through NYCHA” and “works with residents to acquire assistance from various organizations based on their individual circumstance to reach an agreement whenever possible.”

Another fear that NYCHA has tried to tamp down is that private managers will be more aggressive about evicting tenants. City Limits reported in August 2019 that after taking over management of Ocean Bay in late 2016, the private partnership brought 290 cases in housing court against tenants for nonpayment of rent, or about one for every five units, and completed 80 evictions from January 2017 to February 2019.

But NYCHA told the New York Times that there were just 48 evictions in four years after RAD, the same number as in the four years prior.
Similar fears circulated after L+M Development Partners committed in February 2020 to $1.5 billion in improvements at 2,615 NYCHA units in Brooklyn and Manhattan in two separate ventures, one with Douglaston Development, SMJ Development and Dantes Partners and the other in Harlem with nonprofits Settlement Housing Fund and West Harlem Group Assistance.

Tenant groups attributed 151 evictions to L+M’s Ron Moelis in 2019, but that was less than 1 percent of his more than 18,000 households. According to L+M, the actual number was even lower, 72, or about 0.5 percent, and the firm evicted just five NYCHA tenants in 2019 out of roughly 1,600 NYCHA apartments under its management.

L+M is among the city’s largest providers of affordable housing, but Related is known for developing high-end Hudson Yards and for its billionaire chairman and Donald Trump fundraiser Stephen Ross, making it an easier target for critics of RAD.
Flores, of Fight For NYCHA, fears Related could set off a wave of displacement to buoy its bottom line. Nonpayment rates are higher in public housing developments where repairs have been neglected, as is the case in the Chelsea developments. And the state’s eviction moratorium is due to end Jan. 15.

Related declined to comment on Flores’ speculations. A NYCHA executive called Fight For NYCHA’s prophesizing about evictions and demolitions “completely unfounded.”
“NYCHA remains the owner of the property and residents’ rights and protections are built into the lease, and further protected by [federal] regulations,” said Jonathan Gouveia, NYCHA’s executive vice president of real estate development.

He underscored that the developers were picked at the residents’ behest.
 

David Goldsmith

All Powerful Moderator
Staff member

To Improve Public Housing, New York City Moves to Tear It Down​

After surveying residents at two developments in Manhattan, the agency is moving forward with a $1.5 billion plan to demolish and replace the buildings.
Tearing down public housing has become something of a national trend, except in New York, where the New York City Housing Authority has held onto its stock of aging buildings even as repair bills and tenant complaints mount.
But that may be changing.
NYCHA is set to announce on Wednesday that it is moving forward with a $1.5 billion plan to tear down the Fulton Houses and Elliott-Chelsea Houses in Manhattan and replace them with new high-rise apartments for the residents who live there, after it became clear that replacing the deteriorating buildings would cost about as much as rehabilitating them.
At Fulton and Elliott-Chelsea, more than 2,000 public housing apartments would be replaced. The new apartments would have dishwashers, washers and dryers, and access to rooftop terraces. The plan also calls for the construction of new retail and commercial spaces and 3,500 mixed-income apartments, with around 1,000 restricted to people earning lower incomes and the rest renting at market rates.
It would be only the third tear-down in the agency’s nearly 90-year history, and the first time new, mixed-income buildings would be built on NYCHA land. City officials said they hope to replicate the plan elsewhere as conditions in public housing worsen.

“You’ve never heard of brand new public housing,” said Miguel Acevedo, president of the tenant association at the Fulton Houses who has lived in the development since the 1960s and supports the plan. “It just doesn’t exist. To create this for the next generation is really unbelievable.”
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Many developers have eyed the open spaces on NYCHA campuses, which are scattered throughout the boroughs, as prime spots for new development, even as similar pushes have generated opposition.
The idea that demolition is viable reflects the severity of the conditions in the developments, where residents regularly encounter leaks, mold, broken elevators and heating problems. NYCHA estimates it needs to do about $40 billion worth of repairs across the system.

The construction at Fulton and Elliott-Chelsea will be handled by two private developers, Essence Development and the real estate giant Related Companies, who were chosen by tenant leaders and NYCHA in December 2021. The project is part of NYCHA’s contentious push to place more developments under private management, allowing the agency to tap into a special source of federal funds and borrow money for upgrades.

The developers and NYCHA said they felt confident about moving forward at Fulton and Elliott-Chelsea after residents who responded to a weekslong survey indicated they preferred the demolition and rebuild option over rehabilitation. Roughly 30 percent of eligible residents, or roughly 950 people, responded to the survey, and about 60 percent of those opted for demolition.

“No one knows better than the residents what they and their neighbors need, and they were smart to recognize the potential benefits of completely rebuilding their campus,” Mayor Eric Adams said in a statement.
NYCHA hopes to deploy a similar strategy — including talking with residents and helping them decide on the future of their homes — at other developments in the city.
“If you do this all over the city, we’ll be able to provide significantly more affordable housing,” said Jonathan Gouveia, NYCHA’s executive vice president for real estate development.

But past attempts at rebuilding have not been as well received. City officials in 2019 walked away from an effort to demolish two of Fulton’s buildings and replace them with mixed-income homes after residents and activists staged protests against the plan.

But Jamar Adams, the managing principal at Essence who said he spent part of his childhood in public housing, said one key was making sure the new buildings would be finished before the old ones were replaced so residents would know they had a place to move to. He said despite the opposition in 2019, trying to better communicate with residents about the plan and how it addressed their problems helped many change their minds.

“Residents went from justified skepticism of demolition to embracing a transformational plan that will build homes they deserve,” he said.

The project is particularly attractive to developers and the city because Fulton and Elliott-Chelsea are in one of the hottest real estate markets in Manhattan, close to Hudson Yards and the High Line.
Some residents do not trust the plan and are still skeptical about NYCHA’s approach to repairs. Vera Naseva has lived in the Elliott-Chelsea development for four years and opposes its redevelopment. “They just want to take us out,” she said.
The project must go through a lengthy land-use review process, which is slated to begin next year, and must ultimately be approved by City Council. The U.S. Department of Housing and Urban Development must also give its approval, though NYCHA officials said they were optimistic.
Developers said they would build most of the new NYCHA buildings first so the majority of residents would be able to move in before their old homes were torn down. The construction is expected to be finished in six years.
 
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