With the city budget crisis far from resolved and brownfields bills still languishing in Albany, the city is close to a deal which could create more affordable housing in the five boroughs while helping to clean up and reuse its contaminated industrial real estate.
For the last couple of months, the department of Housing Preservation and Development has been discussing with a handful of banks a financial plan that would help clean up and develop old manufacturing properties, and free up millions of dollars for housing for low-income and homeless New Yorkers.
The consortium — comprised of Citigroup, JPMorganChase, HSBC and Deutsche Bank — has expressed interest in investing $4 for every dollar the city puts toward its brownfield program. That could amount to 80 percent of the $200 million fund to which Mayor Bloomberg committed in his December housing plan, according to HPD Commissioner Jerilyn Perine.
“A primary goal is encouraging private sector participants to enter the housing marketplace,” Perine testified at a City Council budget hearing last Monday.
While the deal is not yet final, both city and bank officials say they hope to have it signed and sealed in time for the start of the city’s next fiscal year on July 1.
Said Gary Hattem of Deutsche Bank, “We believe the future of the city and its well-being is tied to housing possibilities,” including those that are affordable.
This deal would free up $160 million in city funding for the creation of affordable housing for low-income New Yorkers and homeless people with special needs, said Perine. The city has yet to determine how this funding will accomplish that — options include rental subsidies, rehabbing buildings and new construction, said an HPD spokesperson. But, testified the commissioner, it will help the city make 46 percent of the 65,000 new apartments planned under Bloomberg’s $3 billion housing plan affordable to low-income households, up from 37 percent announced in March. Moderate-income apartments will make up 38 percent of the new units, she said, and middle-income units 16 percent.
Environmental and housing advocates are cautiously optimistic about the pending deal. “We’ve been trying to figure out the funding issues on the brownfields side and make sure it results in affordable housing and other kinds of uses that are consistent with community needs,” said Mathy Stanislaus, an independent environmental consultant. “We are hopeful that this HPD fund is complimentary toward that purpose.”