MAYOR DE BLASIO ANNOUNCES NEW PROGRAM TO SAVE CITY’S REMAINING AFFORDABLE MITCHELL-LAMA DEVELOPMENTS

Key piece of City’s accelerated 300,000-apartment affordable housing plan will invest $250 million to protect 15,000 Mitchell-Lama apartments at risk of flipping to market-rate

   Mayor Bill de Blasio today announced a new Mitchell-Lama Reinvestment Program to protect the long-term affordability of the City’s remaining Mitchell-Lama developments.  Nearly 20,000 of the City-supervised co-ops and rentals in New York City’s storied Mitchell-Lama buildings have left the program since 1989. The lure of raising rents to profit from the City’s real estate boom, or of selling once affordable co-op units for market-rate prices is an ever-present threat to this critical portfolio. The new program, with an initial infusion of $250 million, will target more than 15,000 homes over the next eight years to save Mitchell-Lamas where affordability is at risk.

Along with the Neighborhood Pillars program, the Mitchell-Lama Reinvestment Program is the second new initiative announced as part of the Mayor’s plan to accelerate the creation and preservation of affordable housing across the city by financing 200,000 affordable homes, and expand that goal to 300,000 affordable homes by 2026 – enough to house the entire population of Boston.

“From Coney Island to the Upper West Side and for decades, hundreds of Mitchell-Lama buildings have offered stable, affordable homes for New York working families. We cannot afford to lose one more of these homes. We’re investing to protect them for the seniors and families who helped build our neighborhoods, and for generations to come,” said Mayor Bill de Blasio.

Since the inception of the Mayor’s Housing New York Plan, the City has preserved, or extended the affordability, of 30 Mitchell-Lama developments with 11,000 residences. Of the approximately 100 remaining developments, with more than 45,000 homes, about two-thirds are affordable cooperatives, representing a significant source of affordable homeownership opportunity for New York City. The others are affordable rental apartments.

With an initial investment of $250 million, the City aims to prevent loss of these affordable homes and apartments by leveraging an array of financing tools to restructure existing debt, provide long-term tax benefits, and fund critical capital repairs.

Most Mitchell-Lama developments, originally funded by the federal government, date from the 1950s and 1960s, and many now need significant rehabilitation work. In addition to low-cost financing, the program will provide Mitchell-Lamas with extended property tax exemptions. These tools help reduce operating costs, which in turn works to keep rents and maintenance fees low for residents. In exchange for the benefits, property owners agree to keep the buildings affordable for at least 20 more years – extending their affordability for another generation or more.

Over the next eight years, the program will seek to preserve long-term affordability for 15,000 Mitchell-Lama residences, both co-ops and rentals.

“With the City’s existing affordable housing stock under increased threat, it’s more important than ever that we preserve our remaining Mitchell-Lama developments,” said City Housing Development Corporation President Eric Enderlin. “I look forward to working with the Mayor and HPD, as we ramp up our efforts to ensure that hardworking individuals and families have continued access to affordable homeownership and rental opportunities.”

“We are working on every front to shore up the affordability of our neighborhoods and saving our Mitchell-Lamas is a key priority.  As part of our push to accelerate and expand the Housing New York plan, this new program will expand our capacity to secure the remaining Mitchell-Lama developments, a vital source of affordable homeownership,” said Housing Preservation and Development Commissioner Maria Torres-Springer. “I want to thank the Mayor, my colleagues at HPD and HDC, and our many partners for their efforts to protect the long-term health and affordability of this critical stock of affordable housing for New Yorkers.”