Hunting in Hunter’s Point South: Affordable Housing in Long Island City

Since first moving to Long Island City five years ago, Kenneth Musante’s rent has been increasing every year. But this year his landlord is asking for $4,000 a month—for a three-bedroom apartment, on the fourth floor, without an elevator. Unwilling to pay a 12 percent increase, the 34-year-old attended the affordable housing forum on Hunter’s Point South on October 1 to find out if he is eligible for a unit in the new development.

“Our building is not a luxury building,” Musante said. “It has no gym, no doorman; it’s just a four-floor walk up, and for some reason our landlord decided to charge luxury prices and that is just not worth it.”

Once completed, Hunter’s Point South—under construction in Long Island City, Queens—will be the biggest affordable housing development in New York City since the 1970s, with 3,000 affordable units. The project’s first phase, consisting of two buildings with 925 affordable housing units, will be habitable in the spring of 2015. Eligible residents, from low-income to middle income families, can apply for one of these affordable units. Affordable housing is a dire necessity in Long Island City, where rents have increased exponentially in recent years, forcing residents to move east. But to what degree will this massive affordable housing development preserve the character of the neighborhood?

Hunter’s Point South’s site was first envisioned for the Olympic Village as part of the City’s failed 2012 Olympic bid. In 2009, the city acquired the entire 30-acre site from the Empire State Development Corporation and the Port Authority of New York and New Jersey. Former Mayor Michael Bloomberg announced the city’s intention to create the first large-scale moderate and middle-income housing in decades on the site and the De Blasio administration took the first steps earlier this year to further the development.

The development contributes to Mayor Bill De Blasio’s plan to create or preserve 200,000 affordable housing units in the next decade.

With 5,000 total units, Hunter’s Point South will set aside 60 percent of the units for affordable housing, a much higher proportion than the usual 20 percent in new developments. The project will also include 17,000 square feet of new retail space, a five-acre waterfront park, and a 1,100-seat school. The tall glass buildings, brightened with red, orange and yellow-flecked windows, will join the Long Island City waterfront. The units facing Manhattan will have a view on the Chrysler building and the Empire State Building, whereas the other ones will have a view on Queens.

Within the 925 affordable housing units, 31 units are reserved for low-income residents making up to $33,200 a year for a family of four; 155 are reserved for low-income residents with an annual income up to $41,500; 430 units are reserved for moderate income residents with an annual income up to $148,010; and, finally, 308 units are reserved for middle income residents with an annual income up to $190,900. District 2 residents are given priority over outside applicants on 50 percent of the units, as many of them are being priced out by increasing rents.

Long Island City has seen a high increase in rents in recent years. From 2012 to 2014, the rent for a studio apartment increased by 36 percent and the rent for a two-bedroom apartment increased by 15 percent, according to real estate websites. Many residents have been unable to keep up. During the three affordable housing forums on Hunter’s Point South, more than 1,000 District 2 residents came to see if they were eligible for a unit.

Rents in these units will be considerably lower compared to the current rents in the neighborhood. For low-income residents rents will vary from $494 for a studio apartment to $959 for a three-bedroom apartment for three to six people. For moderate-income residents, rent will vary from $1,561 for a studio apartment to $4,346 for a three-bedroom apartment.

“Hunter’s Point South won’t be a lot cheaper for me, maybe just a few hundred dollars,” Musante said. “But it is insulated against unexpected price increase. Here rent is not regulated and they can increase by how much they want and Hunter’s Point South is just more stable.”

Developer Frank Monterisi, the vice president of Related Companies, said his company his proud to be part of the project because the units will always be affordable housing.

“These two buildings offer critical housing to our city’s working-class and low-income families and will play an important role in this neighborhood’s transformation into a vibrant, sustainable mixed-use community,” Monterisi said.

Monterisi said that by building affordable housing, developers received tax exemptions and $68 million in subsidies by the New York City Housing Development Corporation.

Rachel Meltzer, a professor of urban policy at The New School, said the district is doing the right thing by giving priority to District 2 residents, as it will help preserve the character of Long Island City and prevent residents from being forced out of their neighborhood.

“Sixty percent is a good number, it’s higher than what you usually hear” Meltzer said. “I think it is a very good effort, but it will be hard to replicate in other neighborhoods. The exceptional thing about this is that you have so much land in the middle of a neighborhood that is going up.”

Community District 2 Chairman Joseph Conley supports the project. He said the city is constantly trying to be mindful of residents unable to keep up with the rent hikes and Hunter’s Point South will definitely help preserve the neighborhood as well as prevent its residents from moving out.

“We need to answer the market rate dilemma,” Conley said. “Not everything can be market rate and it has been impossible to find a good place to live at an affordable price.”

Regional Program Director at Related Management Company

This massive affordable housing development will create a more diverse community with people from different economic backgrounds and might prevent current residents from being priced out of their homes. Although it is a good way to start, experts say it might not be enough to keep rents under control and poorer residents from being forced out.

Lisa Deller, chairperson of the land use committee in District 2, said the development might have a small impact, as it will provide a small fraction of moderate income units in Long Island City. However, it will not be enough to prevent the problem of rising rents and ultimately it may not be enough to preserve the character of the neighborhood, as the district does not know how many lower income residents from the community will be able to live in Hunter’s Point South.

“I think it is a very important first step,” Deller said. “It brings affordable housing to the waterfront. But we need more.”

Bob Engler, principal for SEB LLC, a consulting firm in planning, developing, selling and leasing multi-family housing in Massachusetts, said this development will not stop wealthier residents and businesses from moving in and some Long Island City residents will still be priced out of their houses. However, this development will give a more diversified look to the neighborhood.

“But you have to manage the building right,” Engler said. “That’s the key to make sure it doesn’t have a negative impact.”

Engler said that affordable housing neighborhoods are sometimes associated with negative stereotypes. Affordable housing often causes a downward push in value in leading the neighborhood to be characterized as “poor.” However, as the definition of affordable is high in Hunter’s Point South, Engler said Long Island City will preserve its positive image.

Alex Schwartz, a professor of urban policy at The New School, said that building affordable housing by itself is not enough to prevent rent increase and residents from being priced out. In order to fight these issues the district needs to preserve the affordable housing that is already in place.

“Building affordable housing is essential but not sufficient to offset the forces of gentrification,” Schwartz said.

Harold Simon, the executive director of the National Housing Institute, said Hunter’s Point South is a great way to help residents from being priced out. But, to truly preserve the character of a neighborhood the city and the district need to offer other alternatives to help the lower and middle class.

“The way you help people from being priced out is to keep housing inexpensive now and in the future for other generations,” Simon said.

Simon said one way to do that is to create limited equity co-operative building. A limited co-op is priced so it is affordable to low-income tenants, and when they wish to sell their properties they can only sell at an affordable price. Although tenants might not profit when they sell their property, by selling them at an affordable price they perpetuate affordable housing, Simon said.

Another way to keep housing inexpensive is with no-equity co-ops, a sub-set of the limited equity model, Simon said. Tenants purchase at a very low price and have a monthly fee, comparable to a rent. When they sell, tenants only recuperate their low purchase price.

Community land trust can also keep houses affordable for future generations. In a community land trust, a nonprofit community based corporation owns the land and leases it to a property owner. Low-income tenants can purchase the properties and eventually sell them to other low-income tenants. Simon said that this two-party contract between the landowner and the building owner benefits bother parties while perpetuating affordability.

“The more units there are like this, the more the economic level of the community does not change,” Simon said. “If you provide enough housing for people who are being priced out it should not change the character of the neighborhood.”