The housing authority is planning its very own Tale of Two Cities.
To raise much-needed cash, the agency plans to lease out land to private developers who will then build some 3 million square feet of luxury apartments smack in the middle of Manhattan housing projects.
Internal documents obtained by the Daily News show the planned 4,330 apartments in eight developments are all in hot real estate neighborhoods, including the upper East and West Sides, the lower East Side and lower Manhattan.
Developers will get a sweet deal: a 99-year lease with the lease payments to the authority frozen for the first 35 years.
And they’ll get a big break on property taxes because 20% of the units will be set aside as “affordable,” offered to families of four that make $50,000 or less.
But the vast majority of units — 80% — are “market rate,” and in the neighborhoods chosen by the New York City Housing Authority, that rate is astronomical.
At the Baruch Houses on the lower East Side, where NYCHA seeks 175,000 square feet of new housing, rent in a private building across the street is $3,100 for a one-bedroom apartment.
The high-end units will be built on top of parking lots, community centers, playgrounds and baseball fields within NYCHA developments, according to tenant leaders and elected officials who have been briefed on the plan.
NYCHA expects to pocket $31 million to $46 million in annual lease payments, all of which will go toward fixing up deteriorating buildings. The agency currently has a backlog of 420,000 repair orders and faces a $60 million budget gap annually.
Leasing land for market-rate housing is a first for an agency that has worked with developers to build what has been called moderate-income housing, such as a Chelsea Houses tower with an income cutoff of $167,000 for a family of four. Under the new market-rate plan, however, the units have no income cap.
City Councilwoman Margaret Chin — whose lower Manhattan district includes two developments targeted for the high-end apartments — called the 20% set-aside for subsidized housing “definitely not enough.” But NYCHA officials, including Chairman John Rhea, said they want to maximize their revenue. “With every unit of affordable housing, you’re taking away (money) that could be used by NYCHA,” Chin said the agency told her.
The plan is an experiment in which upper-income people co-exist with the working families.
This dynamic has already caused some tension. At the Smith Houses near City Hall, NYCHA plans to put up more than 1 million square feet on parking lots and a baseball diamond where tenants hold their annual family day. The agency will locate the luxury apartments so they face away from the projects, with the upscale neighbors given their own entrance on South St.
The executive board of Smith’s tenant association opposes the plan, worrying about the “socialization of our community with new residents who have higher economic means than our residents,” the board wrote in a Jan. 17 letter to NYCHA.
Tenant leader Aixa Torres and a dozen Smith tenants blasted the scheme at a community board meeting Tuesday. “We are not going to take this,” Torres said. “You want a war? This is a war, NYCHA.”
At the Douglass Houses on Columbus Ave., NYCHA plans a large building on a parking lot in a neighborhood experiencing an explosion of upscale housing.
“Now they have this influx of yuppies who can afford these big rents,” said tenant Madelyn Innocent, 56.
“The people who already live in public housing are going to be resentful that you built this housing and left them in shambles.”
But a tenant leader had a different take at the Campos Plaza Houses in the East Village, where NYCHA plans to lease out a parking lot on E. 12th St. “It’ll bring more revenue (that) will help NYCHA do what it’s supposed to do,” said Dereese Huff.
“This innovative plan to generate hundreds of millions of dollars of value will allow us to reinvest in NYCHA, where we badly need to make up for the devastating decline in congressional funding,” said mayoral spokeswoman Julie Wood.
gsmith@nydailynews.com
