HABITAT

LEGAL/FINANCIAL

Affordable Housing Scores a Rare Victory

Lower East Side, Manhattan

Masaryk Towers

Masaryk Towers co-op on the Lower East Side (image via Google Maps).

June 8, 2018

In a city where affordable housing is becoming an endangered species, here’s a ray of good news. Masaryk Towers, a 1,000-unit co-op built as part of the affordable Mitchell-Lama program on the Lower East Side, will stay with the program under a deal announced by the city, Crain’s reports

In return for a low-interest mortgage from the city’s Housing Development Corporation (HDC), the shareholders at Masaryk Towers have agreed to such restrictions as  caps on buyers’ income and limits on how much sellers can profit.

During his re-election campaign last October, Mayor Bill de Blasio pledged $250 million to try to keep 15,000 apartments in the program, and the financing for Masaryk Towers is an early result of that initiative. Galloping real estate values had enticed many co-ops to bolt from the Mitchell-Lama program and go to market-rate sales. The ensuing drain on the city’s affordable-housing stock has been acute. 

But there has also been some resistance to the trend. At Cadman Towers, a 421-unit Mitchell-Lama in Brooklyn Heights, shareholders have campaigned repeatedly – and so far unsuccessfully – to privatize. Successful campaigns to privatize are having an adverse effect on the fabric of the city, in the eyes of Cadman Towers co-op board president Toby Potosky.

“My fear is that we’re moving toward New York becoming a gated community – not just in Manhattan, but in the outer boroughs, too,” Potosky told Habitat last year. “I think this $250 million is a small step toward the mayor’s goal of creating and keeping affordable units. This city needs thousands of affordable units – and it’s doable.”

The Mitchell-Lama program was initially funded by the federal government in the 1950s and 1960s, and it created more than affordable 100,000 apartments in New York state. Since 1989, roughly 20,000 of those co-ops and rental units in the five boroughs have left the program and become market-rate, according to the city. The shareholders at Masaryk Towers will not be joining the stampede.

Ask the Experts

learn more

Learn all the basics of NYC co-op and condo management, with straight talk from heavy hitters in the field of co-op or condo apartments

Professionals in some of the key fields of co-op and condo board governance and building management answer common questions in their areas of expertise

Source Guide

see the guide

Looking for a vendor?