Cestero Addresses Progress, Goals and Future Plans
to Help Create a
More Affordable, More Sustainable and More Viable NYC
NY – New York City Department of Housing
Preservation and Development (HPD) Commissioner Rafael E. Cestero delivered
remarks this morning at The New York State Association for Affordable Housing
(NYSAFAH) Networking Breakfast, regarding HPD’s progress on Mayor Bloomberg’s
New Housing Marketplace Plan and the future course of the plan. The event which
was held at the Yale Club in Manhattan was Commissioner Cestero’s first
NYSAFAH meeting since returning to HPD as Commissioner earlier this year. The
Bloomberg Administration’s New Housing Marketplace Plan (NHMP), an ambitious
$7.5 billion initiative to create and preserve 165,000 units of affordable
housing for half a million New Yorkers. Michael Skrebutenas, Deputy Secretary
for Economic Development of New York State, was also a guest speaker at the
“The way forward
begins with a recognition that New York City is a city of neighborhoods and
without continued investment in affordable, sustainable neighborhoods, we cannot
achieve this larger vision,” said Commissioner Cestero. “To this end, the entire team at HPD and
HDC are committed to applying a neighborhood lens to everything we do,
connecting our work to the investments in education, transportation, public
housing and health that are happening right next to us. And by doing so, putting
forward as the model for what ‘Choice Neighborhoods’ means.”
address, Commissioner Cestero discussed the ambitious goals of the NHMP and
stressed that the City is on track to fulfill that promise. While the economic
climate in the country has changed drastically, the four tenets of the NHMP take
on even greater relevance as the City continues to create and preserve
affordable housing using the planks of that broad platform. Those tenets are:
finding new land for affordable housing; creating incentives to develop housing
for new populations; harnessing the private market to create affordable housing
and preserving government-assisted affordable housing. The Commissioner also
stressed that, in facing current economic realities, the City and HPD are
examining every element of the plan and every new, market-driven innovation to
continue to adapt and meet the goals that have been set. Building and preserving
affordable housing in New York City neighborhoods
is a central component of the Bloomberg Administration’s Five Borough
Economic Opportunity Plan to create jobs for New Yorkers today, implementing
a vision for long-term economic growth while strengthening New York City’s diverse
A copy of HPD Commissioner Cestero’s prepared remarks
are attached -
A more affordable, more sustainable and more viable
I am very pleased
to be here in front of the greatest affordable housing industry in the
This is my first
NYSAFAH meeting since I returned to HPD as Commissioner. It is an honor to be
here in my new capacity and talk to you about our progress on the Mayor’s New
Housing Marketplace Plan and our current thinking about the future course of the
I think that
everyone here is familiar with, and has opinions on, our goal to create and
preserve affordable housing for half a million New Yorkers by 2014. Half a
million people – 165, 000 units.
Its is truly remarkable plan, matched only in scale and vision by the
plan put forth by Mayor Koch in the 80’s, which in my humble opinion, literally
saved our city. The vision of
the New Housing Marketplace plan is equally grandiose and important – to create
and preserve enough affordable housing for 500,000 New Yorkers.
We are going to
reach that goal. In fact, in the
midst of this economic downturn and the precipitous drop in housing starts
nationally, New York City continues to forge ahead to create quality, safe and
affordable housing for all New Yorkers.
Over the last fiscal year,
despite the worst real estate market in decades, HPD and NYC Housing Development
Corporation (HDC) put nearly one billion dollars in bonds and $460 million in
subsidy to work, financing 12,500 units of affordable housing for New
Yorkers. Nowhere else in the
country is this possible today.
Many people thought we would miss the ambitious target that we set for
ourselves as well, but we were able to reach this milestone because we saw
opportunities where others only saw roadblocks.
We have a strong tradition of innovation in New York City and we are
putting it to the test to make sure that we meet our goals:
We were the first to use recycled bonds—we are still the only
housing entity in the nation to have put this recycled cap to work—and we were
the first to get the federal Tax Credit Assistance Program (TCAP) out on the
streets and working for us. The funding packages for these two projects alone
topped $300 million. You would be hard-pressed to find any other city or state
that is doing more than we are in creating affordable housing for its residents.
speaks to the power of the partnership between HPD and HDC – whose contribution
to this city is too often taken for granted. It should be clear that without HDC, we
would be able to a fraction of what we do today. Since the 2003 fiscal year,
when the NHMP plan debuted, they have issued over $8.45 billion in bonds and
committed more than $840 Million in corporate reserves to help us create or
preserve nearly 94,000 units under the NHMP to date.
impressive – at a time when many HFAs in other states across the country are
seeing their reserves diminish and their bond rating lowered, HDC’s rating – in
a letter just issued by Standard & Poors – remains
To my friend and
colleague, Marc Jahr, a resounding THANK YOU, for all you and your team do.
accomplishments are unparalleled.
One year ago, HPD
and HDC reached the halfway mark in the plan – with 82,500 units funded.
Everyone in this business recognized what a great accomplishment that was. It
was momentous occasion.
One year ago
something else momentous occurred. Bear Sterns? Lehman Brothers, anyone? AIG?
Yes, the financial giants began folding like proverbial houses of cards,
collapsed by unsustainable risk and unsupportable debt.
I have a hard
time believing that only a year has passed and the landscape has changed so
Yet we continue
to reach for our goals. The original New Housing Marketplace Plan, announced in
another September – in 2002 – was half the size of the current plan and was
created in response to a strong real estate market.
It remains a great plan—we
continue to create and preserve affordable housing using the planks of that
broad platform, from our inclusionary and rezoning initiatives to large-scale
new construction to our work to preserve HUD assisted units —but faced with
current economic realities we must and are examining every element of the plan,
every new, market-driven innovation in front of us and looking at the way
forward through a different lens and with a different focus.
I don’t have all the answers but I know one thing for sure: THE BEST IS YET TO COME.
Why am I so sure?
Because of our collective history.
Faced with abandoned neighborhoods and unprecedented population decline
in the 70’s we created a set of programs to rebuild our city; faced with
economic crisis after 9/11 and increasing demand for affordable housing we
created the NHMP plan; faced in 2005 with the hottest real estate market in
recent memory, we doubled down on the plan and set forth with the largest
municipal housing plan in history.
The promise of today’s crisis, in my view, is the realization of a
bigger dream that I know we all share:
A more affordable, sustainable and viable New York City. The innovation that helps us get there
will take many forms but our focus will be on neighborhoods and families.
Any good neighborhood strategy begins with an unwavering
commitment to expanding the supply of affordable housing. Broadly, we will:
- Preserve existing stock at a time when taking assisted housing projects
to market seems a million miles away.
- Reclaim units that were taken from affordable stock during heat of
market with unsustainable financing
- Reposition failed luxury developments into affordable
in new construction that creates sustainable neighborhoods and leverages
investment in education, transportation, and healthy neighborhoods.
The way forward begins with recognition that New York City is a city of
neighborhoods and without continued investment in affordable, sustainable
neighborhoods, we cannot achieve this larger vision. To this end, the entire
team at HPD and HDC are committed to applying a neighborhood lens to everything
we do, connecting our work to the investments in education, transportation,
public housing and health that are happening right next to us. And by doing so, putting New York forward as the
model for what “Choice Neighborhoods” means.
We cannot succeed in our goal of making New York more affordable
without focusing attention and resources on ensuring that the housing stock we
have is sustainable and high quality.
We are lucky – the financial strain of today’s market has not yet led to
widespread decline in housing quality.
But there is reason to worry.
We have seen this movie before and know that too often financial distress
leads to physical distress. For
these reasons we will marry in new ways our proactive code enforcement efforts
with our efforts to employ sustainable and energy efficient retro-fit techniques
to more of our existing stock.
At the end of the day, we have an underlying commitment to
stabilizing families. In New York today, we have
more families than ever who are facing hardship as a result of the economic
crisis. We cannot and will not let
these families go unsupported. By
expanding our efforts at preventing the scourge of foreclosure and working with
our sister agencies around the city to seek new ways to expand housing options
for families facing housing dislocation during this crisis, we will increase
HPD’s emphasis on connecting our tools to families most in need.
In doing all of these things and more, we will not only create
enough affordable housing for 500,000 people but we will make New York City’s
neighborhoods more affordable and sustainable for the long term.
Clearly we have a
great deal of work to do—but having fielded the largest municipal housing
program in the country not once, but twice, and having, in effect, shown the
rest of the nation how to do it right, we are not about to squander the
opportunities we have before us now. In all, the
City of New
York, with its partners—all
on course to reaching the Mayor’s goal of preserving or building 165,000 units
by 2014. We will do this by confronting the challenges and capitalizing on the
opportunities presented by current market conditions.
We share credit for the successes of the past and we
must work together to be deserving of such credit in the future. We have
unprecedented power and the resources to exploit this market, make it work for
us and for the neighborhoods and families of this city. Our legacy will be making New York City a more affordable, sustainable and viable
City for current residents and those who will call New York home in the
The best is yet to
NYC Department of Housing Preservation and
HPD is the agency responsible for carrying out Mayor Michael R.
Bloomberg’s NHMP and its mission is to promote quality housing and viable neighborhoods
for New Yorkers. It is the nation’s largest municipal housing preservation and
development agency. Responsible for implementing Mayor Bloomberg’s New Housing
Marketplace Plan to build and preserve 165,000 units of affordable housing. HPD
also actively promotes the preservation of affordable housing through education,
outreach, loan programs and enforcement of housing quality standards. For more
information, visit www.nyc.gov/hpd.
Association for Affordable Housing
The New York State
Association for Affordable Housing, formed in 1998, is a trade association for
private sector organizations throughout New York State that are involved in
affordable housing, with the goal to increase housing programs and subsidies, to
be a voice for professionals in the field, and to inform members of new
opportunities and developments. Membership includes developers, general
contractors, attorneys, architects, lenders, equity investors, and other housing
professionals. For more information visit www.nysafah.org.