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PR- 010-04
January 13, 2004


$200 Million Public/Private Partnership to Accelerate the Construction of New Housing Throughout New York City

Mayor Bloomberg Also Issues Progress Report on Administration’s Housing Plan

Mayor Michael R. Bloomberg today launched the New Ventures Incentive Program (New VIP) to accelerate the construction of new housing throughout the five boroughs.  Over a five-year period, New VIP will provide up to $200 million for acquisition and pre-development costs to encourage residential development in derelict manufacturing areas, particularly brownfields, appropriate for rezoning for residential use.  Citibank, Deutsche Bank, HSBC, and JPMorgan Chase have committed the first $40 million for the first year of the program.  The Mayor also delivered a progress report on the $3 billion plan to create and preserve more than 65,000 homes and apartments citywide over the next five years.  To date, 10,197 units are already in the development pipeline with 8,549 and 13,250 units projected in the second and third years.  Housing Preservation and Development (HPD) Commissioner Jerilyn Perine, Housing Development Corporation (HDC) President Emily Youssouf, Citibank Commercial Real Estate Group President Deborah Adelman, Deutsche Bank America CEO Seth Waugh, HSBC Regional President David Kotheimer, and JPMorgan Chase Executive Vice President Mark Willis attended the announcement with the Mayor.

New VIP was created in response to the housing needs of our communities and is a part of an overall housing plan that aims to foster mixed-income communities, transform derelict former industrial areas, and encourage the development of new housing and investment in the existing housing stock,” said Mayor Bloomberg.  “New VIP is a multi-million dollar public-private partnership between the City and our banking partners here today that will develop up to 10,000 units of affordable housing on cleaned-up brownfields throughout the City so that abandoned, decayed privately-owned properties no longer blight our communities.  As I said last week in my the State of the City, our New Housing Marketplace plan is underway and on target, and more than 10,000 new homes are already in the development pipeline.”

Under New VIP, up to 10,000 units of housing including units affordable to low-, moderate- and middle-income families will be created over the next five years.  In October 2003, the City entered into an agreement with four private lenders, Citibank, Deutsche Bank, HSBC USA Bank and JPMorgan Chase Bank, for these banks to provide up to $40 million for New VIP loans in the first year. The City has committed to guarantee up to $8 million of these loans in order to leverage the private bank funds.  These sites can be difficult to develop because of potential environmental contamination or the perception of such given prior use.  The increased market risk makes it difficult for developers to obtain private financing.  New VIP will provide developers with a new source of capital to take the initial steps towards the redevelopment of now moribund manufacturing areas of the City.

“The New VIP program is another example of how HPD is responding to New York City’s changing housing market,” said Assembly Member Vito J. Lopez who is the Chair of the New York State Assembly Housing Committee.  “With the scarcity of land, and limited affordable housing construction opportunities, this initiative will provide the financial support to develop affordable housing on blighted industrial properties throughout the City.”

“At the core of the Mayor’s housing plan is the vibrant and extensive collaboration within the affordable housing community in New York City,” said HPD Commissioner Perine. “Working together with Federal and State governments, local elected officials, the financial and philanthropic sectors, not-for-profit and for-profit development professionals and the people of the communities we serve, we have forged the most successful public/private partnerships in the U.S.” 

“HDC is pleased to play such a key role in helping to fulfill the Mayor’s housing plan,” said HDC President Emily Youssouf. “We look forward to continuing our partnership with HPD, banks and developers in bringing safe, affordable housing to the hard-working people of New York City.”

“Our hope is that new neighborhoods will emerge from this effort that provide a range of housing options for all New Yorkers, making our City stronger and more competitive to ensure its future as the financial capital of the world,” said Deutsche Bank America CEO Seth Waugh.

“Citibank is enormously pleased to participate in the Mayor’s New VIP,” said Citibank’s Commercial Real Estate Group President Deborah Adelman. “As part of the Mayor’s housing initiative, New VIP will help expand affordable housing opportunities for all New Yorkers and strengthen our commitment to help make communities better.”

“HSBC is happy to participate in this unique opportunity that uses public money to leverage private dollars to produce much needed affordable housing for New Yorkers,” said HSBC Regional President David Kotheimer.

“JPMorgan Chase is proud to be part of the public-private partnership with the City that will help create much needed affordable housing through this important initiative,” said Mark Willis, Executive Vice President of JPMorgan Chase/head of JPMorgan Chase Community Development Group.

Immediately following today’s announcement, the Mayor and Assembly Member Lopez toured Rheingold Gardens, a redevelopment of a formerly derelict manufacturing site at the old Rheingold Brewery in Bushwick, Brooklyn.  The project includes 249 units of housing developed by the Bluestone Organization, and includes two- and three-family homes (totaling 156 units) for moderate-income families developed through the City’s Partnership New Homes Program and rental apartments (93 units) for low-income families developed through the New York State Housing Trust Fund.  There will also be new open space, retail, and streets. 

The Rheingold site is unique because it was City-owned and therefore the City could assume the upfront financial risk of environmental testing and mitigation before the site was conveyed to a developer.  For the City to encourage the redevelopment of privately owned former derelict manufacturing sites, it needed to develop a tool to mitigate the upfront financial risk of the sites’ redevelopment, hence the development of New VIP.  The second phase of the Rheingold site will be eligible for New VIP funding.

The progress report on the Mayor’s housing plan and term sheets for developers who are interested in New VIP are available at  The report provides details on other significant housing accomplishments including:

  • Creating Jobs: Over the next five years, the Mayor’s housing plan will create an estimated 66,950 full-time construction and construction-related jobs. Currently, there are 387 construction workers at the Rheingold Gardens site.
  • Maximizing Affordability: HPD estimates that nearly half of the government-funded units will be affordable to low-income households (including homeless households), approximately one-third of the units will be affordable to moderate-income households, and the remaining one-sixth affordable to middle-income households.
  • Increasing Homeownership Opportunities:  HPD has increased homeownership opportunities, including first time homebuyers’ down payment assistance; 242 New Yorkers have graduated from the required Homebuyer Education classes with an HPD-approved counseling agency, and 41 of those are on their way to purchasing their first home. The plan also creates New York City’s first employer-assisted housing program, a retention tool for large employers such as universities and hospitals and a means to make homeownership within the city more affordable for employees. Both are targeted to neighborhoods in the City with lower than average homeownership rates.
  • Expanding Special Needs Housing and Permanent Housing for the Homeless:  HPD expanded special needs housing; this Spring, the City’s first Foyer housing program for young adults at risk of homelessness, will open.  HPD also increased funding for permanent supportive housing by 79% over the next 3 years (from $85 to $153 million) in order to expand permanent housing to homeless single adults, homeless families, and youth aging out of foster care, and began 3 pilots for formerly homeless and low-income families to buy a home.
  • Protecting Mitchell-Lama Residents from Large Rent Increases and Eviction: within the next several months, members of the New York City delegation in the State legislature will introduce a bill to preserve affordable rents for 32,000 Mitchell-Lama apartments by extending rent stabilization. In return, owners would be entitled to real estate tax relief for those apartments that would be newly regulated, and the proposed bill would also provide financial incentives to owners to remain in the Mitchell-Lama program by allowing them to increase their return on equity while maintaining Mitchell-Lama guidelines on tenant income and occupancy.

In addition to the 65,000 units that the Mayor’s housing plan will create and preserve (including the 10,000 New VIP units), there will be another 10,000 units of housing in development in Lower Manhattan over ten years. These units will not only act as a catalyst for job creation and investment in Lower Manhattan, but will help to further encourage the area’s transformation into a 24-hour community where people can live and work.  The Liberty Bond Program provides financing for the development of new residential units in Lower Manhattan.


Edward Skyler / Jennifer Falk   (212) 788-2958


Carol Abrams   (HPD)
(212) 863-5176

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