POOR DOOR BUILDING DRAWS 88,000 APPLICATIONS; DOES THIS MEAN IT DOESN’T MATTER?

poor door6
The “poor door” at 470 West 62nd street, the flip side of the luxury condo development at 50 Riverside Boulevard. Photo by Darryl, who said it “looks like a service entrance with the building garage entrance adjacent.”

The building at 62nd street and Riverside Boulevard that has separate entrances for market-rate and affordable-housing tenants has reportedly drawn over 88,000 applications for 55 affordable rental units, leading developer Gary Barnett to posit that the debate over the poor door was “a made-up controversy.”

Was it?

poor door7Was there really ever any doubt that the development would draw huge numbers of applications, when 600,000 New Yorkers are “severely rent-burdened,” meaning they pay more than 50% of their gross income on rent and utilities? More than 50%! The public policy question behind the poor door controversy is: in return for millions of dollars worth of tax and zoning breaks, what should the city demand from developers? Some think that the city ought to demand that the apartments be integrated into the rest of the development, some think that the city shouldn’t demand that.

Here’s an analogy: imagine the city gave Wal-Mart millions of dollars in tax breaks and subsidies to build a SuperCenter in midtown. And then imagine Wal-Mart decided to pay people $9 an hour and not pay health insurance. Thousands of people would apply for those jobs. Conservatives would say: See! Thousands of people wanted those jobs. Those wages were clearly adequate. Liberals would say: But wait, we just gave them millions in tax breaks and they can’t even pay people a living wage?

Who would be right?

The de Blasio administration has said they’re going to change the law that allows this, but they’ve been slow to do so. (The developer says zoning rules demand that there be two entrances in this kind of development, but we have heard different interpretations from city and community board officials, who call it a loophole that has been exploited.)

In any case, good luck to all those who applied, and may we get hundreds of thousands more units of market-rate and affordable-housing in the next few years. Because 50% of your income is way way too much to be paying for shelter.

Read about the income requirements here.

Photos by Darryl.

NEWS, REAL ESTATE | 39 comments | permalink
    1. Gretchen says:

      With all due respect to the Walmart’s analogy, what about people who pay more to fly first class? Yes, they get bigger seats, better food and, yes, they are SEPARATED from people in coach & biz class. Is that also a Poor Door?

      • West Sider says:

        Did the airline get a large tax break to build the plane? The tax break and zoning variances given to the developer do affect the debate. WSR

        • Ali says:

          Why? The tax break was to make these units available, not to solve all emotional issues related to class. Let’s not oversimplify this and pull a Starbucks. Maybe people applying don’t care because they are living in a luxury building anyway. There are thousands of examples of consumers paying for specialized treatment. Should we equalize all amenities across all buildings in the city and just do away with capitalism entirely? It’s good that there are more units available than there would be otherwise. That was the point. The outrage is misguided. Instead of going to Equinox tomorrow go to NYSC but keep paying for Equinox. Then eat at McDonald’s but pay for the Four Seasons. There are distinctions in service everywhere based on what consumers pay. Why is this suddenly so offensive, and has any applicant spoken out as to whether they even care or us it just wealthy liberals wanting to feel good about themselves?

          • jd says:

            The people applying don’t really care. It’s an affordable apartment in a nice neighborhood. It’s either that or live in a crummy neighborhood where the poor door will be extremely evident.

        • Woody says:

          Actually, yes…Boeing is a recipient of huge tax breaks and subsidies from both state & local governments. Take away those incentives and Boeing would manufacture elsewhere than Washington State.

          Similarly, if NY were to eliminate the tax breaks, developers would yank their capital out of NY and develop projects in more favorable business environments. Then there wouldn’t be any affordable housing units with any type of door.

          • Pedestrian says:

            Are you really telling me that you think developers who build $100 million units are going to build those units in Mississippi because that state will give them more tax breaks? Wealthy people don’t want to live in Mississippi. Developers will build in NYC no matter what but if the City is stupid enough to pay for it they will take that money too. Stupid city or worse.

            • kitcat says:

              Developers would just look for the next best location (New Jersey, CT, Westchester / upstate) to satisfy their requirements and profits for building…..

            • Woody says:

              You don’t know how business people think when it comes to any type of capital investment.

              Developers, in particular, don’t need to build only luxury housing to make a profit. For what they spend on one project in NY, they can do multiple projects around the world and spread the risk. Think McDonalds vs Four Seasons in terms of the tradeoff between profit margin and volume.

        • Jeremy says:

          I’m not sure that your analogies are great in this case. The builder would have built the first class regardless – the tax breaks were just to add the economy seats. It does seem like people want to fly this airline in both classes. The Walmart analogy is particularly rough, since nobody has said that these apartments are inadequate at all.

          If you have an issue with the price we paid to get these low-income apartments/seats built, that’s fair, but that’s a math question, not a philosophical one. To get to the heart of that question, I think the actual numbers would be helpful.

          • West Sider says:

            I think many people have said that the way the building is designed is inadequate: if taxpayers are subsidizing inclusionary zoning, then it should actually be inclusionary.

            • Jeremy says:

              Well, the housing is certainly code compliant and was built consistent with the law. I honestly don’t think “inadequate morality” can be used as a universal standard, and certainly not in this case. We don’t all share the same morals – that’s why we codify only a certain set of behaviors and rules in the law.

              And the intermingling that you’ve been advocating simply isn’t part of the law. If you think these apartments cost us more in tax abatements than they would have cost to be independently built, I’m on board your train. But I think we – as taxpayers – are actually saving money by allowing the developer to build these units. In addition, these subsidized apartments are clearly an awesome opportunity for potential tenants. They’ve told us this by asking to live there.

              Would it be better for subsidized residents if this was constructed as one building? Sure. Would it have been better if these units were never built? Definitely not.

              Where your Walmart analogy really gets tripped up, and where Linda and Helen Rosenthal lose the plot, is that we need the Walmart because the lines at Target and Costco are out the door. Regardless of the needs of the low-income housing community, a great deal of our community would benefit from more overall capacity.

            • West Sider says:

              It’s not necessarily an argument about morality (though many say it is), it’s about good urban planning. The city zoning code tries to do more than make sure buildings are “code compliant and…built consistent with the law.” The zoning code can and arguably should achieve other urban planning goals, including increasing integration and discouraging exclusive cul-de-sac developments.

              As for the Wal-Mart analogy, it works in this case because the government would give the subsidies to stimulate the labor market, not to stimulate consumption or to give consumers an alternative to Costco, as your comment seems to imply (let me know if I’m misconstruing). The labor market for semi-skilled workers is very tight right now, and $9 an hour jobs would draw thousands of applicants. But the question is: should the government demand in return for tax breaks and subsidies that the company provide jobs that don’t cause the workers to still have to apply for food stamps?

            • Jeremy says:

              I wrote something, but accidentally deleted. Oops! In summary:

              – Integrative/inclusive zoning has never necessarily meant “in the same building” as far as I’m aware. To the extent it is a goal, the subject territory is a neighborhood at the very least. This project certainly satisfies urban planning goals as they are typically defined. (I sort of have a degree in this – planning nerd!)

              – I think we’re going to have to agree to disagree about the Walmart example. We’ve kind of come to a place where those hypothetical workers are requiring additional state support. The low-income renters in our example are not – they’re simply precluded from bowling in their own building and entering on Riverside. There’s no gap that needs to be filled by the community/taxpayers. For sure, their needs will be completely and adequately satisfied by this new building.

              – I’ll drop the increased capacity point, but do feel that building hundreds of market rate apartments on vacant land is an awesome thing and fundamentally something to encourage.

          • DMH says:

            One flaw in the analogy though is that housing / shelter is a basic human right; and air travel isn’t. It was in the news this week that Manhattan is the single most unequal county for income in the US, measuring the top 20% versus the fifth quintile. A couple weeks ago – not to put you on the spot but was it you Jeremy? – we were talking about how ‘normal’ the people in a Larstrand or Aire type building are. I know you didn’t mean average, but median household income in Manhattan is $75,000. Household! We’ve all gotta live somewhere – cops, teachers, firefighters, plumbers, social workers, waiters, all of us. It’s a little hard not to feel like the balance of the tax incentives here is giving us more $25 million condos – and the politicians more donations – and less good-quality affordable housing than we need as a city.

            • Jeremy says:

              That was me that mentioned those rental buildings, but I think I’m a little obtuse with respect to the point you’re making here. 🙂

              That said, it’s a bummer that the buildings being put up as of right are very often extremely expensive condos, and those built with incentives are often exclusively for very low income residents. Those of us in the gooey center aren’t finding a whole lot to like. Unfortunately, if you take away the incentives, you might not get any privately constructed low-income housing at all.

            • DMH says:

              I agree Jeremy – this is a great example of the supply-demand mismatch. Personally, I think the poor doors are needless, and mean-spirited. My other point was that we easily can blur the line between normal, like down-to-earth, and median, or average, and sometimes forget that a full 50% of our households are always going to be looking for housing on less than the median household income. Separately, I feel like we should immediately have know-your-customer rules for real estate purchases, so we can be confident that corrupt money isn’t being laundered through $25 to $100 million condo purchases.

    2. More people applied for the affordable apartments than would have voted in a City Primary for the council district the project is located in. Real estate a la carte is obviously the way to go, you only get what you pay for. Affordable housing is in demand, so why are so many of the Manhattan politicians and community action groups against the new zoning resolution? A good set of rules to create this housing is needed. Defining what affordable and making it sustainable need to be addressed. Tax subsidies cannot be the only way to make this work. Our current elected officials many who have been in office for a long time, need to explain their reasons for legislating the policies we see today.

    3. caitlin says:

      What happens to the affordable units once the tax break expires? (Typically 20-25 year duration)

      Do the affordable units revert to market rate housing? If so, then the units are actually only “temporarily” affordable.

      Assuming this is the situation, it means that developers get to build bigger luxury – a permanent structure – but only offer “temporary” affordable units. Does not seem honest.

      • Christina says:

        It can go beyond 20 years. It’s up to the landlord. And if you are 62 when the 20 years are up, you are exempt from program ending.

    4. TG says:

      I’m having trouble feeling any outrage here. That entrance is nicer than mine, and so is the building.

      • NS says:

        Agreed. This is nicer than my building/entrance. The entrance to the luxury building at 200 W 72nd is adjacent to the TJs loading dock which is constantly being used. Despite the main entrance being a “poor door” blocked by people in Hawaiian shirts, rent is still sky high.

    5. Pedestrian says:

      It really burns me. Barnett gets millions and millions of subsidies and tax abatements and he “provides” 55 units of temporarily affordable housing. It would be good to know exactly how much he racked up in benefits for his fake largesse. Poor door, indeed! With all the benefits Barnett has been getting from the affordable housing program he should be giving affordable housing tenants the Red Carpet treatment.

      I am sick of paying for Extell’s profits. Unfortunately, the Mayor is poised to our even more money into developers pockets.

      Developers just love their “progressive” mayor.

    6. Patricia Gilman says:

      I think this is a disgrace, I also think the door we are looking at in the picture is not finished, not that it will be anything like the one in the front!!! Will it have a doorman

    7. Christina says:

      As I said to an earlier article…The 80/20 program has been going on since the mid 90′s. It’s only now that it’s getting much attention. So taxpayers Have Been Paying for 20 years!! So now your complaining?! We need the program! No one is building affordable housing. So this is an alternative! And a lucky few get in. So what’s the problem?!

      • West Sider says:

        The inclusionary zoning program was changed substantially in 2009. This kind of “segmented” development was allowed then. Some people think these changes are okay, but it’s worth debating.

      • Pedestrian says:

        No, many people have been complaining for a long time. The affordable housing programs that provide tax breaks, outright cash grants and bonuses relating to height, bulk and square feet have been being abused for years. The cost of just one TEMPORARY affordable housing unit is enourmous when the units are built. Often they are not and the City does nothing.

        I find it amazing how many people just love corproate welfare but hate the few dollars we actually give to people. But then I guess its said to see the head of Extell on his last billion. Almost Every time one of these monstrosities goes up we lose real affordable housing and small businesses not to mention light and air for the mere mortals on the ground but never mind developers need money.

    8. nj says:

      to be the devils advocate….
      Gotta watch that the door doesnt become and easy entrence for the high paying cutomers! What if the front door is a pain to go in and out of? Did anyone think of that?
      I truthfully didnt want to read all the comments but just put my two cents in…

    9. Christina says:

      It was under Mayor Giuliani that the 80/20 program started. Just some info, if you are one of these people who think this is new!

    10. C says:

      The number of folks on the list (88,000!) is just staggering.

      All to create 55 lottery winners the rest of us will subsidize in perpetuity, creating 55 millionaires courtesy of the taxpayers, when the present value of their subsidies are taken into account over their lifetimes.

      This should show in stark relief the scale of the problem and why the 80/20 initiatives are just a rounding error.

      When you combine the fact that so many people want to live here, the NIMBY attitude everyone in the city has, and the fact that rent control limits supply, this is what you get. None of this will change until we get rid of rent control, stop subsidizing luxury development, raise property taxes on non-resident owners of condos, and start removing any and all obstacles to add supply at all levels. The demand for housing ain’t gonna change.

      • Christina says:

        What???!!!! Having 55 lottery winners BY NO MEANS creates 55 millionaires!!!! I know for a fact! You have no idea what you’re talking about!!!

    11. Chris says:

      If the 55 rental units lacked something basic like plumbing, your Wal-Mart analogy might work. A separate entrance? Not so much.

    12. jd says:

      Where have you gone Mitchell Lama?

      • Bruce Bernstein says:

        excellent point.

        • anonymous says:

          well, BE the change you want to see…you want to see “good landlords”? Then be one Bruce! You own an apartment. Why don’t you vacate it and rent it out at an under-market/”affordable” rate as a rent-stabilized unit and then be exceptionally happy when your new tenant stays for life and passes on the lease to a child. It’s morally questionable to ask others to give up earning potential unless you’re willing to do it yourself. 😉

    13. Joyce Weidenaar says:

      This entire debate is a dust-up about something ridiculous. Applicants will get a new, well equipped, well managed, well located apartment for a below market rent. By the way, the separate door allows for a separate tax lot which makes financing and equity available to find those affordable units. If not separated this would be far more difficult if at all possible, so be careful what you wish for. And feeling mumpish because you might not have access to all the cool amenities? I’m in the top 10% income level and I can’t afford to rent most of the new apartments being built today. Deal with it and enjoy what is available to you.

    14. Christina says:

      BTW… There are a number of lottery programs for the $40,000-$80,000 income range as well these days.

    15. JANE says:

      SOOOOOO SAD SOME PEOPLE FEEL THE NEED TO BELITTLE OTHERS IN ORDER TO FEEL GOOD ABOUT THEMSELVES.
      ITS THAT KIND OF THING THAT WILL BRING THIS COUNTRY TO ITS KNEES.
      GROW UP ! ! ! !

    16. Jeff Goldbeck says:

      yeah, it kinda does