Transcript: Mayor Adams Tours Offices Being Converted to Homes, Highlights Key Affordable Housing Priorities for State Budget

March 13, 2023

Mayor Eric Adams: Thank you. Thank you so much. As we were walking around, I couldn't help but to reflect on just the next generation and how the conversation on living is just shifting. I think the pandemic has caused us to shift faster than we thought of. My son, the whole concept of being indoors is just, it's just not real for him. He believes in shared spaces. He believes in a short period of time of being in his apartment. I was joking — I don't even know if he knows how to turn on his stove. He's out. He enjoys the camaraderie and the cross pollination of people interacting together. And as we look at some of these drawings — we were on the rooftop — this picture here, showing the shared space. This is a shared space mindset of the future generations. And this concept really falls in line with Deputy Mayor Maria Torres-Springer and Chief Housing Officer Jessica Katz, of what we have been talking about.

And so we're excited about the challenges that are in front of us, particularly around affordable housing. And that's why last year we declared that New York City will lead the way on housing in America. This is a conversation that I'm hearing from my mayors across the country. How are we dealing with housing? How do we think differently about housing?

And you can't do it if you start out from saying no. Dan Garodnick, who's over at Planning knows that we must be a “City of Yes.” We have to think differently and we have to lean into how do we have a different approach to housing. So we have to say yes to housing, yes to new zoning, and yes to innovation. They all go together, hand in hand. And so today, we are here to highlight just how we are moving that agenda in the right direction.

The bottom line is we must make it easier to convert office buildings like the one we just toured into housing for New Yorkers. It has been just extremely difficult, and just to imagine that there's certain buildings we can't convert just because of the years that it was built. We need to look at how do we have a different approach to this.

And as I indicated in my state of the city, we are going to remain the greatest city in the world by building housing and affordable housing for everyday New Yorkers on several income bands; from low-income to middle-income, to market rate and to luxury. All of those combinations come together to have the city of this magnitude. And we must remain a place where everyday people can find housing. That's why we have made affordable housing a central part of our working people's agenda. And the deputy mayor has been clear with the moonshot moment of 500,000 new homes over the next decade.

We released our housing, our neighbors plan to connect more New Yorkers to safe and stable homes. And the most important one is the one I like, get stuff built — to speed up construction of new housing in all five boroughs just has been taking too long to put a shovel in the ground and we want to change that mindset and get stuff built in this city.

But we said from the beginning that we need help from the state. During this time, our team, we have been in Albany repeatedly engaging in very fruitful and healthy conversations with the state lawmakers. And I must say that both houses, the leaders in the Senate and leaders in the Assembly, they both understand the urgency of the moment that we need more housing and the only way we can have more housing is to build more housing. And so we are excited about the possibilities of what is going to come out of Albany.

We cannot thank the governor enough. She has been a real partner in this conversation about housing. She has included a number of key investments and policies in her proposed budget that would help us address the housing crisis. And we are here today to say that these items need to be included in the final budget that's going to pass later this month.

I know Albany, I've been there, so there's some deep conversations that are taking place but we think this is a real win. And as I walk around this building, I really want to thank the Vanbarton team for showing us around this amazing project and for the vision of moving forward with a project of this magnitude. It makes it clear what we can do with more of our vacant office buildings.

We're talking about millions of square feet of office space. Even in those companies where people are remaining in their companies, there's a concept of downsizing and so we have to think differently. And so we can do this together. It's about having partners in the state but also partners in the City Council. And I am really pleased to be here with our finance chair, Council Member Brannan, and Speaker Adams, the leader of the Council who are also aggressively understanding that we must partner together to plan to speed up these office conversions and for raising their voices to keep the changes we need from the state.

And I also want to thank just a real leader, the chair of the New York City Planning Commission. Dan has been a real visionary even as a Council person and now he's in this important role and job. He comes with every day his A game of how we going to build more and how we going to have our city's office adaptive reuse task force that he is in charge of. He's coming up with common sense solutions to the housing crisis and spending time in Albany as well.

We've already been talking to the partners and the state legislators. We are excited about the outcome of really leading with our chief housing officer, Jessica Katz, and deputy mayor for economic and workforce development, Maria Torres-Springer. They have really pushed this agenda forward for our city.

Our goal is to get this done, come up with some real victories out of Albany. And we want to also keep pushing for an incentive to help property owners make much needed repairs in exchange for keeping homes affordable into the future. But we cannot forget, one of the most important things we can do is 421-a. It's crucial that we get this done, even if we do a temporary version until we can hammer out the details. But we need an extension of the 428.

This would allow construction to be completed in an existing pipeline of affordable housing projects. It is crucial that we do so. This is not a giveaway. This is an incentive to get more affordable housing units in place. Without it, we simply will not be able to build affordable housing at the rate we need.

We also make the case for more funding for NYCHA tenants, new regulation for basement and cellar apartments, and a number of other important changes in investments. When you think about it and do a real analysis, the crisis, the housing crisis of the 1920s, we built 750,000 new homes, more than three times the amount we've built in the last 10 years. We did it then and we could do it again. And not only can we do it again, we must do it again if we are going to address the housing crisis.

In working with our partners in Albany and the City Council, we can take the next major steps towards providing quality housing for all New Yorkers. New York must be a city where working people can live, thrive and generations can continue to aspire to be here from generation to generation. And this administration will lead in the way.

And again, I want to bring on my partner in government, City Council Member Justin Brennan, who fully understands how important this moment is. Justin.

City Council Member Justin Brannan: Thank you, mayor. Thank you, mayor. When we passed the bill on the City Council to create the task force to explore office to residential conversions, basically because I got tired of hearing people talking about can it be done. I went to the mayor and said, "Let's actually figure it out. Let's sit down, let's get the greatest minds we have and let's figure out if it can be done." And I think what's happening here is really an example of that, of putting a what if into action and a what if in a why not.

Right now we're really in the throes of an affordable housing crisis. We're not in the throes of an office space crisis. We have too much unused office space and not enough housing. So it's really no-brainer. It's one of those moments when everything just lines up and makes sense. Like the mayor said, we need our partners in Albany to incentivize these conversions to make it easier for developers to do this. If they have unused office space and we have such a need for affordable housing, this is the way to make it happen.

We're going to do everything on the city level to make it as easy as possible to go through this process. But we need our partners in Albany to really incentivize this and make it as easy as we can. This is something that almost 75 percent of New Yorkers support — turning unused vacant office space into residential units. It has overwhelming support across the city and it's just really a common sense no-brainer policy. But now we have to do everything we can to incentivize it to make sure that it gets done and makes it easier to get done.

You're talking about maybe 40,000. If the blueprint that Dan's task force laid out, we could house about 40,000 families over 20,000 units in this city just by converting unused office space into residential housing. So, let's get it done. Thank you, Mr. Mayor.

Mayor Adams: Thank you. Thank you.
  
Mayor Adams: Before we do that, why don't you come... Well, you or your son, why don't you come and say a few words about this project, okay?

Richard Coles, Vanbarton Group: I'll be very brief. Thank you for your time. Thank you everyone for your time and support. Creating a livable place for people to both socialize, work 24 hours a day, seven days a week, rather than having a part of the city that is quiet a few days a week, active a few other days a week is vital. It creates a better community, a safer community, and effectuating a change and enabling office buildings to become residential buildings is paramount. And we've done it at 180 Water Street. We're doing it here and a few other places in New York City. And we continue to support the plan to keep that momentum going. So, thank you.

Mayor Adams: Thank you, thank you.

Tischler: Appreciate your time.

Mayor Adams: Very much. Very much. And for those of us who remember pre-9/11, this was a 6 PM community. I was assigned to district two that covered Lower Manhattan as a transit officer. 6 PM, people were gone. Now, this is a 24 hours, seven day a week — people are walking their dogs, enjoying the nightlife and enjoying living down here. And so we've been here before and we cycled out of it. And so we're looking forward to, and thank you for being a pioneer, forward-thinking as we turn this dream into reality.

Yep.

Question: Couple questions. If I wanted to rent a one-bedroom apartment here once it's done, how much would that roughly go for? What are some of the incentives that you're putting out there to get people on board? And what are some of the challenges with turning a space like this into residential?

Mayor Adams: Okay, why don't we turn it over to you, deputy mayor. The rent part of it, you could give up the rent part of it, but deputy mayor.

Deputy Mayor Maria Torres-Springer, Economic and Workforce Development: That's right. Thanks for your question. So, what we're looking for in Albany is the ability to do a couple of things to make this type of conversion easier across the city.

One is a change to what is called the Multiple Dwellings Law to allow the conversion from office to residential. Right now, if you look at the map of where this type of conversion is allowed, it's really a patchwork depending on when a building is built and where it is in the city. So that's one part.

The second part, to your question though, is we're also looking for authority for a tax exemption that would allow the possibility of affordability, affordable units whenever there is a conversion. So those are the two things that have to work hand in hand so that as there is conversion, there's the ability for more affordable units.

I'll let Richard talk about this building. This is a market rate building and we're happy that it is converting to residential. But if we are successful with our partners in Albany, then what we'll see is not just the conversion to residential but also the addition of affordable units because of the tax exemption and the incentive that will be made possible.

Mayor Adams: Richard.

(Inaudible.)

Coles: Rent will start at about $3,000 a month and going up from there.

Question: I have a couple of questions about the building. How long did it take to convert one unit? How many units will be for floor? And we're talking about affordable housing crisis, how does a $3,000 unit help with an affordable housing crisis? Some people can't even afford to pay $1,000.

Mayor Adams: What we have in the city is a housing crisis. A housing crisis. And the goal is to build low-income, middle-income, and market and to shore up NYCHA. So it's not a one size fits all. We have a housing crisis. When I speak with my principal and police officer, they are having a housing crisis. So we don't want to divide and separate our city.

We have a housing crisis. And as the deputy mayor stated that if we are able to incentivize the affordable units by putting money into it like we did with other projects in the city, the Bruckner projects, Innovation Queens, the Willets Point project, we're able to do so. The game is to make sure we get the zoning to get out of the way so that we can use the creativity to address the housing crisis. Wait, hold on. Yeah, one at a time. We got you. We got you. And so they want to talk about the floors. All right.

(Crosstalk.)

Joey Chilelli, Vanbarton Group: Yeah, Joey Chilelli. So overall 588 units and from start to finish, so we go systematically throughout the building from bottom up. So from the time we started until the time we get our first TCO for that set of units, it'll be 18 months. But overall completion of the project 24 months.

Question: So, without the incentives —

Question: Yes, if you could answer, without the incentives that they're looking for, how did you decide to convert this? What economics were in play for you to do that?

Coles: I think cost basis of our investment, which we purchased back in 2013, enabled us to be able to do it without incentives. But incentives would of course help with other people.

Question: On the incentive, if you were talking about a revised 421-a or something along those lines, some critics of it have said that it was too much of a giveaway in the past. They've said, and Governor Hochul trying to possibly get something like this moving forward, not just the extender part. What advice do you have for her to convince people that this is a good thing and to kind of create consent?

Mayor Adams: Yeah, no, great question. We should do a real analysis of how many projects are in the pipeline, how many projects have stalled. And as we talk about the housing crisis we're facing, to make sure that we can come up with a good 421 version that we all can live with.

Do we find 100 percent agreement on anything? No, you don't. But we can find a compromise that will continue to incentivize development of affordable units and at the same time make sure that the price point remains affordable for low income, middle income New Yorkers as well. So, we are excited about the conversations in Albany around our overall housing agenda, but it's crucial that we do need a 421-a plan.

Question: The governor's proposal on conversions [inaudible] do affordable housing, but it's up to them. Do you have a sense at all of what share of the conversions would choose to do affordable housing?

Mayor Adams: Jessica, why don't you…

(Crosstalk.)

Jessica Katz, Chief Housing Officer: I'm sure. I got it. It will depend on what is ultimately passed. Because with each of the incentive programs, the devil's usually in the details. So our goal is to make sure that it's the type of incentive program that makes sense to get the conversion, to get the affordability so that we're not eroding our own goals, but we can follow up with specific estimates.

But we're not trying to force anyone to do a conversion. What we're trying to do, as the mayor mentioned, is to get rid of all of the barriers, and there are many of them that exist today, regulatory, financial, to make these conversions possible because we have to use all of those tools to meet the housing crisis that has been dire and unrelenting over the course of the last several decades.

Question: So how many units are we going to have? Are we talking about the percentage of the or number of units that you're going to be had that are affordable?

Mayor Adams: This unit, this project here is market rate. This project here. Our goal is to do the changes that we're talking about so that we can incentivize by putting in city resources to do affordable on low-income and middle-income. Okay?

Question: So, on this agenda, there's the office to residential conversions, 421-a. What are some of the other items that the governor maybe didn't put in her budget that you're going to be pushing for? Where those at in terms of negotiations?

Mayor Adams: Jessica, you want to talk about some of the housing stuff?

Katz: Sure. One thing we're looking for is to make sure that NYCHA gets support in the upcoming state budget. So, that's something that we're working with Albany on as well. But we are very proud that in very large part, our housing agenda is very well aligned with the governor. So that's once in a generation opportunity to take a big swing on housing and we're really looking forward to it.

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