City’s affordable housing effort enters new territory

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The de Blasio Administration’s affordable housing campaign
has moved into new territory with the launch of a $13.2 million property rehab
in Harlem.

For the first time in decades, the city has handed over
ownership of the land to a Community Land Trust (CLT) and arranged a financing
package that will pay for the buildings to be gutted inside and out.

A board of tenants, community members and nonprofit groups with then be in charge of running the buildings and operating them as permanently affordable rentals.

RAFAEL CESTERO

Rafael E. Cestero, president and CEO of The Community
Preservation Corporation, said the venture will give those who live in the
homes a say in their future and keep them out of speculative real estate markets
blamed for gentrification and the dislocation of local populations.

“With the pandemic deepening the housing crisis,
particularly in communities of color, preserving affordability and creating
stability for our city’s tenants is more critical than ever,” said Cestero.

“This project will help accomplish that goal by ensuring the
local community will have a voice in the future of these properties, as well as
helping to secure their permanent affordability.”

The East Harlem El Barrio Community Land Trust now owns the land at 53 East 110th Street, 201 East 120th Street, 204 West 121stStreet, and 304 East 126th Street where the 36 rental apartments and three commercial spaces will undergo a substantial renovation.

53 East 110th Street

The CLT will steer the project, ensuring the development
will serve the Harlem community, and work with its Mutual Housing
Association  in partnership with the New
York City Department of Housing Preservation and Development (HPD), The
Community Preservation Corporation (CPC), Enterprise Community Partners
(Enterprise), Banana Kelly Community Improvement Association Inc, and the
Community Assisted Tenant Controlled Housing Inc (CATCH).

Under the deal, the City provided a 40-year Article XI tax
exemption, $7 million capital subsidy, and transferred land ownership to the CLT.
After renovations, the CLT will enter a 99-year ground lease with the Mutual
Housing Association with the rents for current residents set for a typical
family of three earning $36,000. For the vacant apartments, rents will be affordable
for a typical household of three earning up to $102,000. 

The apartment buildings will include homes for mobility and
vision-impaired residents. Ten percent of units will serve formerly homeless
households. The City also hopes to allocate additional Section 8 resources to
enable a portion of the vacant homes to be affordable to the average family of
three earning up to $51,000.

As part of the venture, Enterprise Community Partners
awarded $500,000 to the community development association, Banana Kelly, which
will work with CATCH on training tenants to support the mutual housing
association’s operations.

CPC provided a $5.2 million construction loan and a $5.8 million permanent loan through its partnership with the New York City Retirement Systems (NYCRS). The Office of City Council Member Diana Ayala provided support and the office of former City Council Member Melissa Mark-Viverito contributed $500,000.

LOUISE CARROLL

“East Harlem’s El Barrio CLT is helping us chart new
territory when it comes to community-driven affordable housing development
while delivering long-term stability and affordability to East Harlem and its
residents,” said HPD Commissioner Louise Carroll.

Calling the venture “game changing,” Hope Burgess, Banana
Kelly’s President & CEO, said, “We are proud to be working with HPD, CPC,
CATCH, Enterprise Community Partners, Councilmember Ayala and the residents of
the East Harlem El Barrio CLT to establish a Community Land Trust that
transforms the power dynamics with regards to land, allows for a larger degree
of resident control of land and reduces the speculative nature of land
ownership.”

“CLTs are a critical part of the solution to our city’s
affordability crisis,” said Council Member Diana Ayala, who represents
District 8 in East Harlem and the South Bronx. “After supporting the
development of the East Harlem El Barrio CLT, I am thrilled that we are finally
announcing the transformation and transition of these properties to affordable
units that allow for the preservation of community-controlled, deeply
affordable housing in East Harlem for generations to come.”

Mayor Bill De Blasio announced a commitment to developing
Community Land Trusts in his State of City City address last year. He promised
to give ownership of some 3,000 city-owned properties across the city to CLTs
and allow communities, rather than developers, to determine how to best use the
land to ensure long-term affordability.

Expanding CLTs is part of the Administration’s wider affordable
housing policy which has focused on transferring public land to private housing
developers using time-limited affordability agreements, a practice opponents
maintain leaves open the risk that developers may one day privatize.

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