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May 12, 2010

Another push to turn luxury condos into affordable housing, but cost is unclear; report proposes eminent domain for condos but slams it for AY

Atlantic Yards Report

Can 4000 empty luxury condos, including some in and around Downtown Brooklyn, really be converted into low-income housing owned by a community land trust or the New York City Housing Authority?

Several activist groups say yes, though their proposals--involving tax foreclosure and the use of eminent domain--are thin on the actual number of condos that might qualify, given that only a fraction are in empty buildings rather than simply languishing on the market.
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Still, a report issued yesterday makes some policy recommendations that deserve discussion: development tax breaks should be suspended, and owners of buildings who warehouse their units for more than a year should be assessed fees.
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The report criticizes New York State for using eminent domain "to pave the way for large-scale, luxury development projects," such as Atlantic Yards, the "vast majority of which will be luxury, market-rate housing despite the proliferation of failed luxury housing that already currently exists in this area."

(The report says AY will help" further the gentrification of low-income communities." By contrast, ACORN, Forest City Ratner's partner, contends the project will help fight gentrification. The Empire State Development Corporation says gentrification was already happening in the areas nearby.)

Also, given the large number of market-rate units yet unsold, the report implicitly casts doubt on projections by Empire State Development Corporation consultant KPMG that condo prices in AY towers would reach $1217/sf in 2015.

Here's some more news: money-bags Bruce Ratner owes the city $240,000 in back taxes for 80 DeKalb.

Forest City Ratner's 80 DeKalb, according to a Brownstoner tipster, is supposed to be 50% rented. If it's in tax arrears, I'd bet it's less that the building is vulnerable to foreclosure than Forest City Ratner maintaining cash flow.

Or maybe it's more complicated. FCR also missed a mortgage payment at 10 MetroTech, which is the main component of the block-wide complex that includes 80 DeKalb.

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NoLandGrab: Bruce Ratner has gotten hundreds of millions of dollars in handouts from the taxpayers, and he can't make good on less than a quarter-million in arrears?

Posted by eric at May 12, 2010 11:19 AM