An unusual group of people live at the Art Lofts in Peekskill, New York. One resident holds monthly open-mike poetry readings in her 1,600-square-foot loft. Another recently invited neighbors, family, and friends into his apartment for a show of his own large canvas oil paintings. Yet another uses her high-ceilinged live/work space to hold ballet classes.
All the shareholders in this 28-unit cooperative apartment complex are working artists, and that list includes musicians, architects, photographers – even a fiber artist crafting hats and garments from felt.
It’s no coincidence. The artist-only lofts were built in 2002 with help from city and state officials to bring artists to live in the heart of this quiet Hudson River town. “The city was looking to revitalize,” says Anthony Ruggiero, assistant city planner for Peekskill. “You have to have people living downtown.”
For decades, cities and towns have used art, including housing for artists, as an economic development tool. The Art Lofts represents the latest generation of cooperative apartment communities designed around the needs of artists. As with those before it, the community struggles to balance the needs of the artists with those of government officials and the local housing market.
The three newly constructed buildings are designed around the needs of artists, with lots of flexible live/work space. The lofts provide ample light with high ceilings and open floor plans with up to 2,000 square feet of space. The windows in many second-floor units are well over ten feet tall.
To live in one of these desirable apartments, potential residents must be approved by the city’s Artist Certification Committee, a seven-member panel including six local artists and Peekskill’s director of planning.
“You may have twenty people interested and five actually qualify,” says Christopher Marra, economic development specialist for Peekskill. The restriction is written into the property’s zoning. Applicants show whatever credentials they have, their portfolio of work, and bank statements that show at least half of their income comes from their art.
Artist housing projects like the Art Lofts are perfectly legal. Although the federal fair housing act forbids housing providers to discriminate based on the race, national origin, disability, family status, sex, or religion of potential residents, the law allows developers to restrict their housing based on other factors, such as age, income, or occupation. “Artist housing has no Fair Housing implications,” says Chantelle Lewis, a spokesperson for the Department of Housing and Urban Development, the federal agency that enforces the fair housing law.
The Art Lofts are part of Peekskills artists’ district. In 1991, the city re-zoned eight blocks of its depressed downtown, mixing residential and retail spaces so that property owners could rent the empty spaces over their shops as apartments. The district is zoned so that artists, and only artists, can move into the residential spaces. Today, 49 of those apartments are rented to artists, in addition to the 28 cooperative Art Lofts.
The artists have brought new vitality downtown – and they’re a bonus to the city budget. “Of course, it helps with taxes, because there was nothing there before,” says Marra.
New York has a long history of using artist housing for economic development. Cooperative apartments reserved for artists came to New York City in the 1960s, as much of the city’s industry left for larger spaces and cheaper labor. Artists began to move into improvised spaces in the abandoned old factory and warehouses. In 1964, the city and state changed the state Multiple Dwelling Law to make room for artists in old commercial and industrial buildings in a handful of designated areas. According to the law, New York’s cultural life is enhanced by “large numbers of persons regularly engaged in the arts.”
More than 3,500 units of housing are still legally reserved for artists in loft buildings, mostly in the Soho and Noho neighborhoods, though the “artists-only” rule has largely been left unenforced as the lofts have grown more and more expensive.
However, some buildings have kept the faith, like the artists lofts at 799 Greenwich Street. “It used to be a no-man’s land,” says Rosemary Rotondi, who has lived for nearly two decades in the old industrial building in the West Village close to the waterfront. The five-story walk-up once held businesses including a harpsichord manufacturer, a cat and dog hospital, and a printer’s shop. But by 1963, the empty hulk was owned by the city, which gave it to the group of artists and forgave a lien for unpaid taxes.
Under the new law, the artists turned the space at 799 Greenwich Street into 12 lofts. The building is still reserved for artists, though restrictions on the income of the artists and the sale price of the units have long since been removed. “Only persons counted as artists or working seriously in the arts will be eligible to purchase,” according to its offering plan. The co-op board, which manages the building, certifies potential artist residents. Current residents include painters, sculptors, cartoonists, architects, film editors, a photographer, and an archival film researcher.
And the restriction hasn’t affected the value of the building – when apartments have come up for sale at 799 Greenwich, they have sold quickly and at market prices, according to information from StreetEasy.com.
However, it’s possible to layer too many restrictions onto a community. Sales have been slow at the Peekskill Art Lofts, in part because of the long line of regulatory and economic hoops prospective homeowners have to go through before they can move in. Three units are currently on the market. A fourth is slowly moving towards a closing.
“It takes four to six months to approve a new buyer,” says Thomas M. Leigh, an architect and the president of the co-op board. Qualifying as a working artist can be the easy part. Prospective homeowners also need to be relatively well off. Even though regulations keep the cost to buy into the community low, the $14,000 to $20,000 price must be paid in cash, according to the co-op’s offering plan.
In the absence of a home loan from a bank, the cash buy-in is similar to a conventional down payment because it forces buyers to make a substantial cash investment in their new home. Artists also need to convince the co-op board that they have steady income strong enough to pay the monthly maintenance fee of $1,050 to $1,600 a month. The board usually takes about 30 days to approve a potential resident, says Leigh.
But buyers can’t be too wealthy. Thanks to restrictions put on the buildings when they were developed, prospective residents cannot earn more than 95 percent of the median income of $84,250 a year for Westchester County for a two-person household. Officials have outsourced the income certification process to a local nonprofit, the Housing Action Council, which can take months to approve a potential resident. Sellers can pay the $500 cost per income certification themselves or they can bill the prospective home buyer.
After passing all these tests, the resale value of shares in the Art Lofts is also kept relatively low, first by restrictions in the cooperative offering plan, then by even stronger restrictions imposed by Westchester County, which provided funding to help build the Art Lofts.
According to the offering plan, the maximum price of an owner’s shares increase in value by six percent a year. Also, the part of the homeowner’s monthly maintenance fee that goes to pay down the principal of the cooperative’s overall mortgage can be added to the maximum sale price, according to Lewis Montana, partner with the Peekskill law firm of Levine & Montana, which represents the co-op board.
But Westchester County has overruled the offering plan. County officials insist the value of shares in the Art Lofts can only increase by an annual amount close to the rate of inflation. County officials can enforce their more restrictive idea of an allowable increase because the offering plan also allows the county to subtract from the sale of shares a cash amount that represents the apartment’s share of the county’s $600,000 investment in infrastructure for the buildings. In exchange for compliance with its rules, the county has so far waived its rights to this cash. The co-op board is currently negotiating with state and local officials to clarify the ambiguities of the offering plan.
In the meantime, the Art Lofts must compete for potential residents with properties that have no regulatory restrictions. For example, instead of moving into the Art Lofts, artists could rent an apartment like the 900-square-foot, two-bedroom townhouse recently advertised on the website rent.com. The townhouse is located just outside of downtown and rents for $1,650 a month. It’s less space than a loft, but artists can move right in.
Leigh worries that regulations and delays might eventually seriously damage the Art Lofts if it becomes too difficult to find buyers for the apartments. “They may cause this project to fail,” he says.
Nonetheless, on the plus side, there is a strong sense of community at the Art Lofts, partly because the residents share a profession, but also simply because so many residents work out of home. Mark Gilmore, who with his wife works in photography, says it is what true cooperative living is about. “You’re more likely to know your neighbors,” he says. In an increasingly dehumanized society, that’s no small feat.