Colony 1209, a rather, um, insensitively named luxury development in Bushwick featuring a doorman, ping pong tables, a “speakeasy,” and a gym, has caused quite a stir since it opened up its 127 units inviting “bohemians” to become “settlers” in “Brooklyn’s vibrant new frontier.” Last summer, Bushwick Daily dubbed Colony 1209 the neighborhood’s “most controversial new building,” which judging by the apartment’s website copy, is something the developers might just have been aiming for. But in a neighborhood where there’s an acute and visible housing crisis happening (see: tenant harassment, demographic shifts, skyrocketing rent, etc.) it was a matter of time before people got really angry.
Jose Lopez from Make the Road New York, an activist organization that represents immigrants and minimum wage earners, said the development’s advertising language “feels really disrespectful to long time community residents.” But that was just one reason why community activists working for Make the Road and Churches United for Fair Housing organized a protest of about 130 people outside the apartment building yesterday.
The protesters’ call for action held that the building includes “no units that local residents can afford” and is reaping tax benefits supposedly reserved for developers who build affordable housing. Organizers allied against what they see as the audacity of the developers for lauding the luxuries of their building reserved for outsiders all while raking in tax breaks from 421a, a controversial tax abatement program first developed in the ’70s to encourage housing construction.
Back then, New York City was struggling financially and the housing market was floundering in kind. Eventually the program was haphazardly restructured to provide benefits for developers willing to build out affordable units along with market-rate units, normally to the rate of 20 affordable apartments for every chunk of 80 market priced apartments.
“Right now we’re in a place where what we’re seeing with Colony 1209 and other buildings is that the tax abatement program is doing nothing but giving tax giveaways to luxury developers,” Jose argued. “It’s not resulting in any true affordable housing for community members we serve– the majority of our base here is earning anywhere from 20-40 percent of the AMI [Area Median Income.]”
Local politicians and housing activists have cited 80/20 as too low a threshold for affordable housing in some communities where AMI is lower than that of the city’s average. Jose agreed that old status quo and needs to be thrown out the window,” he said. But furthermore, “affordability” in the case of some 421a tax abatements requires developers to create units that are affordable for people earning as much as 80 percent of the AMI.
“If we’re talking about affordability that starts at 80 percent of the AMI, then we have a serious concern because that touches none of the poorest New Yorkers,” Jose explained.
The New York State Senate will review 421a at the start of this summer, and many affordable housing advocates are calling for either a complete overhaul of the program or an end to the subsidies which they say benefit wealthy developers more than they help New Yorkers in need of affordable housing.
“We need to strengthen the rent laws and close all the loop holes, but also let 421a go away,” Jose said. “There’s no use for it.”
Colony 1209’s owners, Spruce Capital, inherited the 15-year tax abatement when they bought the building in April 2014. According to the protest organizers, 421a will save the owners $8 million in taxes even without building any affordable housing. Say what?
Prior to the 2008 amendment to 421a in Albany, if developers built in certain parts of the city (mostly areas outside of Manhattan) they could apply to receive a 15-year tax abatement under 421a without being required to build any affordable housing whatsoever. The requirements to receive 421a tax abatement now are slightly tougher–for example what’s called the “exclusionary area” has expanded to include areas like Bushwick– and the law now requires the 80/20 market rate to affordable housing ratio for housing built in this zone.
“But even for the buildings that are receiving the abatement now, because the affordability requirements start at 80 percent AMI, depending on where you are building most families in that area won’t make 80 percent AMI,” Jose said. “That is double what average families in Bushwick make.”
As of January of this year, the Colony 1209 building itself was once again on the market, this time for just over $80 million. Market rate apartments (based on Zillow’s page for the property) at the Colony are going for $3,120 a month for two bedrooms which is a notable increase since the Times reported two bedroom units in the building were going for $2,800 a month just last year.
“These are still apartments that folks will never be able to move in to,” Jose explained.
And protests like this around the issue of 421a are only going to heat up until it’s time for the law to expire in June given the increasing urgency of the affordable housing situation across the city. Yesterday, the Times reported that the Upper West Side apartment building infamous for its “poor door” design separating affordable units from the market rate ones, received 88,000 applications for those 55 units affordable units.
“This is really about whether our friends in Albany are going to be pro-developers and pro-billionaires or whether they’re going to be pro-tenants,” Jose said. “We’re hoping we can think of better policies at the state level that protect all families including those making $20,000, $30,000, $40,000 a year and need truly affordable housing.”