New York City Housing Authority has issued a revised Request
for Expressions of Interest (RFEI) that could help it raise an estimated $1
billion to help repair its crumbling stock.
Under its new Transfer to Preserve program, NYCHA will sell un-used
air rights to developers who control property adjacent to public housing.
Purchasing the air rights will allow a developer to build
new projects or enlarge existing buildings while helping NYCHA raise money
towards its estimated $30 billion repair budget.
Previously, NYCHA has leased its land to private developers
for infill development. Under the Transfer to Preserve program it can still
raise money without selling off its land.
Under the Transfer to Preserve program, developers must
propose as of right plans to transfer the extra space to their privately-owned
parcels.
According to a memo from Fried Frank, the revised program
will create a clearinghouse of eligible sites that will allow the housing
authority to review more proposals and ramp up the program.
The TTP Program, a developer’s site must be contiguous to
the NYCHA site for a minimum of 10 linear feet or the NYCHA site must be located
in a “Special District” where as-of-right transfers include off-site transfers.
The RFEI states that NYCHA will evaluate proposals for the
TTP Program principally on the amount of revenue generated from the sale of its
excess development rights. NYCHA will also consider whether the proposed
development benefits NYCHA and the City, the developer’s experience completing similar
developments, and how well the proposed development integrates into the
surrounding area.
A developer’s proposal does not need to include any
affordable housing.
The TTP Program is applicable to any NYCHA site that
currently has excess development rights to sell, with two exceptions. One
exception is where NYCHA is currently in the process of closing a sale of development
rights, and the other is NYCHA Permanent Affordability Commitment Together (PACT)
sites that are currently under conversion.
Currently two NYCHA sites have closed or are about to close
a transaction for development rights – Hobbs Court in Manhattan and Ingersoll
Houses in Brooklyn. A number of other properties are already in the process of
negotiating air rights transactions including Fulton Houses, Howard Houses, and
College Avenue at East 165th Street.
The air rights transfer plan was originally devised by the
Regional Plan Association which calculated that a city Zoning Text Amendment
could put into play 78 million square feet of NYCHA’s transferable rights.
Selling these rights, the RPA estimates, could yield $4.2 to $8 billion for
NYCHA repairs.
The program gives the authority more flexibility than
typical property owners in moving Transferable Development Rights around the
city. By moving NYCHA air rights across the street, up to a half mile away, or
within a Community District, the opportunities for revenue generation increase
exponentially.
TPP is a part of NYCHA 2.0, a 10-year plan to preserve
public housing and deliver top to bottom renovations for 175,000 residents, fund essential capital repairs
across the rest of NYCHA’s portfolio, and launch aggressive new repair
strategies to tackle lead paint, mold, elevators, heat and vermin.
NYCHA 2.0 includes Build to Preserve, which will deliver
roughly $2 billion in capital repairs through new development on NYCHA land, Transfer
to Preserve and Fix to , which will improve services, infrastructure
maintenance, and immediately address health and safety issues including
heating, mold, pests, and lead.
