New York Could Turn Hotels, Offices into Affordable Housing

New York State could buy financially distressed office buildings and hotels and convert them into affordable housing for homeless and impoverished New Yorkers under a bill being considered in the state Senate. The bill, introd

BY Realty Plus
Published - Friday, 05 Mar, 2021

New York Could Turn Hotels, Offices into Affordable Housing

New York State could buy financially distressed office buildings and hotels and convert them into affordable housing for homeless and impoverished New Yorkers under a bill being considered in the state Senate. The bill, introduced this week, is similar to a plan proposed by Gov. Andrew Cuomo during his State of the State speech in January. However, State Sen. Michael Gianaris, a Queens Democrat who wrote and sponsored the bill, said the Senate proposal mandates affordable units and would only be open to commercial buildings. The bill, introduced this week, is similar to a plan proposed by Gov. Andrew Cuomo during his State of the State speech in January. However, State Sen. Michael Gianaris, a Queens Democrat who wrote and sponsored the bill, said the Senate proposal mandates affordable units and would only be open to commercial buildings in distress and up for sale. New York City’s commercial districts have been hobbled by the Covid-19 pandemic. In Manhattan, the overall commercial vacancy rate increased to 13.3% in the third quarter of 2020, the highest number in 24 years, according to a report from real estate services firm Cushman & Wakefield. Under the Senate bill, building owners could sell their properties to the state to allow for the construction and conversion of permanently affordable housing for people who are street homeless or living in shelters and for low-income residents. The state could use federal money allocated through Covid-19 relief or other federally funded programs to purchase distressed properties, according to the bill. It isn’t clear how much money would be needed to make such purchases. The bill would mandate that only hotels with fewer than 150 units could be converted to affordable housing. It excludes hotels in most of Manhattan. Some of the converted properties would be operated by housing non-profits and other organizations, according to the bill. New York City Mayor Bill de Blasio’s administration supports the creation of affordable housing and is reviewing the bill, a spokesman said. Mr. de Blasio had previously been critical of the governor’s plan. The bill has the support of the Hotel Trades Council union, whose members recognize the need for affordable units, a union official said. James Whelan, president of the Real Estate Board of New York, the property industry’s main lobbying group, said in a statement that the organization supports building much-needed housing that includes affordable units. The organization supported Mr. Cuomo’s January proposal, which it noted is different from what Mr. Gianaris is pushing. But it supports multiple ways to create more affordable housing, a spokesman said.