NYCHA will build on ‘hot’ East Side, chief assures

Photo by Jonathan Alpeyrie The Smith Houses on the Lower East Side had been earmarked for infill towers under Mayor Bloomberg, and possibly could be again under Mayor de Blasio. Above, a resident relaxed on a bench on the complex’s airy, light-filled grounds.
Photo by Jonathan Alpeyrie
The Smith Houses on the Lower East Side had been earmarked for infill towers under Mayor Bloomberg, and possibly could be again under Mayor de Blasio. Above, a resident relaxed on a bench on the complex’s airy, light-filled grounds.

BY LINCOLN ANDERSON |  When Mayor de Blasio appointed Shola Olatoye chairperson and C.E.O. of the New York Public Housing Authority in February 2014, he gave her two assignments: first, to “reset relationships with residents,” and, second, “to come up with a plan” to save North America’s largest public housing authority.

With 607,000 residents, NYCHA’s population is larger than Las Vegas, Atlanta or Miami. If it were a city, it would be the country’s 30th largest. One of every 14 New Yorkers lives in NYCHA housing.

In an interview with the editorial staff of The Villager and NYC Community Media last Friday, Olatoye laid out some of the major features of that new 15-point plan, NextGeneration NYCHA, including, most notably, the authority’s intention to build new housing that is 50 percent affordable and 50 percent market rate on open land within existing NYCHA developments in “hot” neighborhoods.

In September, the sites of the first two of these “50/50” so-called “infill” projects were announced — NYCHA’s Wyckoff Gardens in Boerum Hill / Gowanus, Brooklyn, and Holmes Towers on the Upper East Side, which would respectively see up to 650 and 400 new units built on their grounds under the plan.

Currently, those are the only two projects in the pipeline for this program. However, when asked by The Villager if the authority — as it had done under Bloomberg — would set its sights once again on the open spaces in East Village and Lower East Side public housing developments for these mixed-income projects, Olatoye said, yes, definitely.

“We’re doing it in areas where there are strong real estate markets,” she explained.

It might not be tomorrow, but NYCHA will certainly be looking to build within the East Village and Lower East Side housing developments, she said.

“Oh, they will be — eventually,” she said. “This is a 10-year program. We’ve started with two [projects]. There will be others. Look, there’s no secret — there’s only a hot market in certain neighborhoods, right? We undoubtedly will get to some of these hot properties. It’s a dynamic process, and we’ll be adding more sites going on. We have real financial challenges, and our land is one of our only resources.”

Community engagement
But “a big difference” between this administration and the prior one, she noted, is that “a very extensive community-engagement process” is being done with the residents affected by the infill projects. For example, she said, NYCHA has impressed upon Wyckoff Gardens residents that that complex has a $40 million need for critical capital repairs, including for roofing and new pipes. Money from the developers’ lease will fund the complex’s repairs.

Over all, the authority has nearly $17 billion in unmet capital needs for its aging buildings. Meanwhile, under NextGeneration NYCHA, the agency will generate modest annual operating surpluses totaling more than $230 million over 10 years, instead of piling up a $2.5 billion deficit over the same period were no action taken. Due to a 30 percent decrease in federal capital funding since 2001, the agency has lost $1.16 billion.

Former Mayor Bloomberg announced a scheme in 2013 that, similarly, would have seen new infill housing built within a greater number of NYCHA projects, but which was far more skewed toward the affluent: 80 percent of the units would have been market rate and only 20 percent affordable. The idea crumpled under criticism from public housing residents, who both objected to it on principle and protested that they hadn’t been included in the planning process.

Local East Side housing developments included in Bloomberg’s 80/20 infill plan were Smith Houses, Meltzer Tower, Campos Plaza, LaGuardia Houses and Baruch Houses.

Under the new NYCHA plan, the affordable housing in the new 50/50 towers will be dedicated to families earning no more than 60 percent of area median income — about $46,600 for a family of three in 2015.

As under the previous, scrapped Bloomberg plan, the city-owned land for the new towers would be leased long term to the developers, since NYCHA cannot sell its land, Olatoye noted.

Photo by Lincoln Anderson Shola Olatoye, the chairperson of NYCHA, speaking with NYC Community Media’s editorial staff last week.
Photo by Lincoln Anderson
Shola Olatoye, the chairperson of NYCHA, speaking with NYC Community Media’s editorial staff last week.

‘Massive development’
The agency’s construction efforts are part of Mayor de Blasio’s goal to create 200,000 units of affordable housing within 10 years. Of that number, NYCHA projects creating 10,000 units over that span.

“This is going to be a massive amount of development,” Olatoye said. “In totality, the development program as a whole [would generate] $300 million to $600 million [in revenue for NYCHA].”

Many of the authority’s developments were constructed in the mid-20th-century “towers in the park” style, which leaves open space to build on, Olatoye noted.

‘Density is the way’

However, asked by The Villager if the agency will be trying to squeeze too much onto its developments’ grounds, the chairperson disagreed.

“I would say we’re not,” she said. “That was a different time and place. It was a luxury that we had, to have that kind of space. We’re looking at just seas of red, in terms of how this place is operating. I think it would be irresponsible for us not to take advantage of the tools at our disposal. Obviously, you have to do it within the context of what’s the impact on the surrounding community, schools, quality of life?

“I also say that, this is New York City, we’re a dense place, right?” Olatoye continued. “This administration has said density is the way that we’re going to address this incredible pent-up housing demand. There’s no question that this is not easy. And I think the challenge for us is, a New York City without public housing is not something that any of us want.”

It will be about two-and-a-half years from now, before shovels are in the ground on the two current 50/50 projects, she noted.

As for public housing residents’ feedback on the new infill plan, she said, “You know, the response…this is New York — it’s been dynamic. Some people are, like, of course you have to do this. Some people are not happy with it. It’s always easier to stand on the sidelines and scream. And it’s harder to come up with solutions. In the meantime, these buildings are literally crumbling; two-thirds of our buildings are over the age of 60. And there is no white knight, there is no silver bullet,” as in a hoped-for spike in federal funding that is unlikely to come, she noted.

Playgrounds, like this one at the Smith Houses, and parking lots are potential open space that could be used for future development on NYCHA property.
Playgrounds, like this one at the Smith Houses, and parking lots are potential open space that could be used for future development on NYCHA property. Photo by Jonathan Alpeyrie

Campos Plaza deal

In another effort to staunch its cash gap, NYCHA at the end of last year closed a deal with a group of private developers — including L&M Development Partners and Preservation Development Partners (including Donald Capoccia’s BFC Partners) — under which the developers now own 50 percent of Campos Plaza I, as well as E. Fourth St. Rehab, in the East Village.

The deal — described as a “30-year partnership” — also included other federally funded Section 8 developments in Brooklyn and the Bronx, for a total of 900 units in three boroughs.

In return for their half ownership stake, the developers will pay NYCHA $250 million within the next two years, plus another $100 million over the next 15 years.

The developers are investing around $80,000 per unit, installing new kitchens and bathrooms, in the 900 apartments. Building lobbies are also being renovated and security improved.

In return for upgrading the units, the developers will be eligible for federal funding to cover the difference between market-rate rents and what the Housing Authority charges for rent.

Speaking in February, Olatoye had assured that the deal would not lead to the buildings’ future privatization. However, it is, in fact, possible that after 30 years, the units could turn market rate.

Too many cameras?
At a panel discussion on gentrification in October, organized by writer Alan Kaufman, Jose “Cochise” Quiles, the former leader of the Lower East Side’s notorious Satan’s Sinner Nomads street gang, complained about the new security cameras that are being added all over Campos Plaza, at 635 E. 12th St. He said that whole families are now at risk of losing their apartments if the cameras show someone living with them who is in trouble with the law or illegally “doubled-up” with them in their apartment.

Told of Quiles’s comment, she responded, “Have you talked to the residents who live there? That right there typifies my job,” she said, adding he sounded a bit like “a crazy person.”

“People are angry that there is more security there and not the building across the street? Why is that building getting new kitchens and bathrooms and the other isn’t?” she asked.

What will NYCHA's "angle" be at East Village and Lower East public housing complexes, like the Smith Houses?
What will NYCHA’s “angle” be at East Village and Lower East public housing complexes, like the Smith Houses? Photo by Jonathan Alpeyrie

‘I understand that fear’

“I hear your point. I think fear, unfortunately, is a terrible place to start,” Olatoye said. “And I understand that fear. I think people look at development in neighborhoods, and they feel housing insecure. Their wages are stagnant. They see the reality that the bodega that was there yesterday is now gone and there are condos.

“It’s not wrong,” she said. “People’s perceptions are the reality. I understand the fear. But this mayor and this administration have been clear from Day One that the public housing in New York City will remain public. And the rights that tenants in good standing have come to expect, they can continue to count on that as a source of housing for their families.”

Olatoye noted that, technically, Campos Plaza and the other buildings in this deal were “not public housing,” in that they were both owned and administered by NYCHA under the Section 8 program. They were “incredibly expensive” for NYCHA to run, she said. Public housing, on the other hand, is known as Section 9.

Huge cash upfront
“Our ability to partner with a developer provided a huge upfront cash payment to the authority that allowed us to actually balance our budget for the first time in 15 years last year,” she said of the deal involving Campos and the other buildings. “It also will allow for more than $80 million of capital repairs that would not otherwise have gotten done in those 10 housing projects.

“I live two blocks from one of them, I can see the development happening,” said Olatoye, an East Harlem resident. “For the first time in a very long time, these buildings have on-site supers. They have doors that work. They have laundry rooms that work; NYCHA really got out of the laundromat business because it couldn’t take care of laundries in the face of defunding.”

She said the financing structure for these Section 8 buildings, in fact, has been changed in a “transparent way.”

NYCHA residents “need to see” the results, she added, noting, “We actually have done a fair amount of bringing NYCHA residents to some of those buildings and saying, ‘Look at what this partnership allowed us to do.’ ”

Baruch Houses security
On another issue, Olatoye was asked about a rape last month at the Baruch Houses that saw the criminal gain entry to the building through a front door with a constantly broken lock. What can be done, she was asked, to ensure that these locks are fixed in a timely manner to ensure tenants’ safety?

“Horrible, horrible incident,” Olatoye said. “Thankfully, cameras were working. We were able to pull the tape, work closely with P.D. [police] to find the alleged perpetrator. That typifies our challenge. Doors get broken constantly. Staff respond. They’re broken the next moment, again. My men and women leave at 4 p.m. So, the reality is that door is probably going to stay unlocked until someone shows up at 8 a.m. the next morning. That is a function of my labor contract.”

Asked if there is an overnight crew that can respond, she said, “We do have overnight emergency services, who are focused on emergencies — gas, fire, electrical things. Not that doors are not an emergency. They are in our priority list. But it remains a huge challenge for us.”

NYCHA is installing stronger doors with “layered access” technology, linked to the police, using money it has received through a district attorney program. But a big problem, she noted, is that security and safety measures in NYCHA buildings are not funded by the U.S. Department of Housing and Urban Development, so the money has to be allocated by the City Council.

In addition, residents also simply have to take responsibility for “closing the door,” she said.