February 28, 2023
Chairman Salamanca Jr and members of the Committee on Land use:
On behalf of our President and CEO Carlo A. Scissura, we thank you for the opportunity to testify today on this important topic. The New York Building Congress is a broad-based membership organization that consists of more than 500 constituent organizations and 250,000 skilled tradespeople and professionals, including architects, engineers, contractors, developers, and labor.
We want to start today by also thanking the Mayor, Commissioner Garodnick and his Office to Adaptive Re-use taskforce who outlined eleven sound recommendations to guide the city’s process of converting office space to residential units earlier this year.
Specifically, we want to highlight the following recommendations as we believe these are crucial to consider when exploring the adaptive reuse of office space: 1. expanding the number of buildings that can access the most flexible reuse regulations; 2. rezoning manufacturing districts in midtown west to allow new residential uses; 3. and pursuing a tax incentive program to include affordable housing and childcare facilities in these conversions, which closely relates to priorities outlined in our 2023 policy agenda.
At the State level, Governor Hochul proposed multiple changes in her FY 2024 Executive Budget to support these. Specifically, ELFA Part J, which would expand the eligible buildings authorized to convert to residential uses and exempt those buildings from the 12 Floor Area Ratio (FAR) cap. The FAR cap was instated 90 years ago, is largely arbitrary. It limits affordable housing construction, job creation, and the economic growth of New York City. Crucial Mitchell- Lama projects that house our middle class such as Tracey Towers and Manhattan Plaza could not be built today with the current FAR cap instated. Removing this for office space conversions and as a whole is a step in the right direction to combat the city’s archaic zoning laws and spur sustainable development in central business districts, and near public transit.
Additionally, ELFA Part P, which would provide tax incentive benefits for affordable housing rental units in these conversions also promotes the equitable component to these conversions. The Governor’s proposal would call for a tax incentive for at least 20 percent of units to be affordable from office conversions for households ranging from 40 percent AMI to 100 percent AMI with an average of no more than 70 percent AMI, making rents for 2 and 3 bedrooms south of 96th street below $2,000, which is currently unheard of in Manhattan.
Incentivizing investment in construction directly correlates to the creation of jobs and the overall health of our economy. Specifically, for every $1 million spent on construction 8 jobs are created in NYC.
The New York Building Congress will continue to advocate in Albany for these changes, but strongly urge the council to also accept and support the proposals that could produce tens of thousands of new homes in Manhattan, and truly house all New Yorkers at every income level. Our members appreciate your continued support and stand ready to build new, affordable housing that will be yielded by these changes.
