Case Study 12

Case Study 12

Cypress Hills Plans, Rezones and Builds Affordable Housing in East New York

Construction Site


Cypress Hills Local Development Corporation (Cypress Hills) administers a state-funded planning grant in the Cypress Hills section of East New York, one of the city’s lowest income neighborhoods. With grant funds, Cypress Hills designed a mixed-use affordable housing project with 58 affordable apartments, an 8,000-square-foot grocery store, a playground, a garden, and a community space.


Cypress Hills had identified a site for the project, but it hired a real estate broker for two reasons. First it could not approach the owner because its identity was masked by a corporate entity. Second, Cypress Hills wanted a broker knowledgeable about market prices in the area to protect against a private seller inflating the land price in hopes that city government, which would fund the project, might overpay for the land. So Cypress Hills hired Cornerstone Group Realty Services, which it had worked with previously, to identify the owners and negotiate the terms of a sale. Cornerstone introduced Cypress Hills to the owner and negotiated a purchase option agreement that secured the property for Cypress Hills and compensated the owner until Cypress Hills obtained the financing to purchase the site.

Cypress Hills acquired the site at 2501 Pitkin Avenue in 2011, and Cornerstone earned a commission on the sale. Cypress Hills then worked to rezone its newly acquired site because the existing R-5 zoning only permitted a four-story building with an insufficient number of units to make the project’s finances work. The Pitkin Avenue project would be Cypress Hill’s first rezoning. Working with the full support of the Department of City Planning, the local Councilmember and the community, the process took 18 months. Michelle Neugebauer, Cypress Hills’s executive director, says that rezoning for a community development corporation also requires an experienced project manager on staff to handle the paperwork and the support of an architect, lawyer, and zoning consultant.

Cypress Hills Broker


The rezoning allowed Cypress Hills to add three floors to the building. As part of the rezoning, the New York City Planning Commission placed an E-designation for hazardous materials and noise on the property which requires the developer to address these potential exposures before the property can be redeveloped and occupied. Currently, Cypress Hills is working with OER to address these environmental requirements and cleanup the site. It has enrolled 2501 Pitkin Avenue into the city’s Voluntary Cleanup Program to satisfy the site’s environmental requirements and gain access to program incentives, including $50,000 in cleanup grant funding.

Groundbreaking at the site took place in November 2015 and construction is expected to be completed in September 2017.

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