NYCHA’s Nostrand Houses Taps Public Trust Funds
NYCHA has a new source of funding — that is, if tenants choose to take it.
The first NYCHA development to join the New York City Public Housing Preservation Trust is Nostrand Houses, a 16-building complex made up of 1,148 units. The Sheepshead Bay property closed on $607 million in preservation funding to modernize the complex on Wednesday.
Mayor Zohran Mamdani touted it as a first step toward ending a “legacy of neglect” across the distressed public housing portfolio, emphasizing that NYCHA will retain full ownership and management throughout the modernization of Nostrand Houses.
The first group of 2,000 public housing residents who voted to join the preservation trust back in 2023 will see renovations kick off this fall with government funding, marking a step toward the administration’s goal to reboot NYCHA’s role as a developer of new public housing, the mayor and Deputy Mayor for Housing and Planning Leila Bozorg noted at the announcement.
“This is just the beginning of our work to revitalize tens of thousands of NYCHA homes via the preservation trust,” Mamdani said. “We will return to NYCHA’s roots as a public developer, not just repairing housing, but building the new high-quality homes that deliver even more New Yorkers lives of dignity.”
A design-build team, Community Modernization Group, will spend the next five years renovating thousand-plus units in the Nostrand Houses complex, while addressing needed repairs to heating, hot water, plumbing, elevators, wiring and security systems. The development will convert to a Section 8 subsidy, which allows the complex to receive greater federal funding while maintaining certain resident rights and rent affordability thresholds.
The trust was established by a bill sponsored by State Sen. Julia Salazar, which Gov. Kathy Hochul signed into law in 2022. In addition to Nostrand Houses, residents at NYCHA complexes Bronx River Addition, Unity Towers and Hyland Houses have also voted to join the trust.
The Nostrand Houses financing is supported by a funding mix from the federal Department of Housing and Urban Development, along with the city’s Office of Management and Budget and Housing Development Corporation. Merchants Capital, Nixon Peabody and the AFL-CIO Housing Investment Trust also provided financing and subsidy, according to a press release.
Another NYCHA development undergoing a conversion, Fulton and Elliott-Chelsea Houses, has presented a cautionary tale for the Mamdani administration. Protracted legal battles and pushback from a small vocal group of mostly senior residents who refuse to leave their homes in a complex slated for demolition have delayed redevelopment of the site by private partners Related Companies and Essence Development.
What we’re thinking about: Does the preservation trust seem like a viable way to fund the development of entirely new public housing across New York City? Or are private developer partnerships the way forward to efficiently build affordable housing? Let me know what you think at ben.miller@therealdeal.com.
A thing we’ve learned: Manhattan divorce cases commonly take two to five years to resolve, a lawyer told TRD reporter Caroline Spivack for her story this week on the impact that the pied-à-terre tax is having on wealthy couples’ breakups.
Elsewhere…
— The mayor convened the first meeting of his new business advisory council and led by newly appointed Economic Development Corporation Chair Lina Khan, best known as the firebrand head of the Biden-era Federal Trade Commission. The business advisory council, which counts RXR’s Scott Rechler and Community Preservation Corporation CEO Rafael Cestero among its ranks, had a “fruitful” first gathering where they discussed what success looks like across industries including housing, Mamdani said at a Wednesday press conference.
— The 34th Street Partnership, an organization that oversees Herald Square Plaza and Greeley Square, put out a bid for a business to bring a carnival park to those outdoor spaces, seeking “amusement rides, mechanical attractions, arcade games” or other activities not typically associated with one of the busiest Midtown intersections. Whoever wins the bid would enter into a one-year agreement with the option to renew up to four years and would sit on an acre across the two plazas, according to The City Reporter.
— Another unlikely spot for revelry, the rooftop of the Brooklyn Children’s Museum, has brought hundreds of partygoers to an otherwise residential block in Crown Heights. The museum has rented out its rooftop to host decidedly adult-focused parties, including events dubbed “Kocaine All White Renaissance” and “Rum and Music.” While neighbors have voiced frustrations, the museum’s president argues the revenue they generate helps fund free services for children and families in the community, Gothamist reported.
Closing time
Residential: The most expensive residential sale recorded Wednesday was $5.4 million for a 2,030-square-foot, sponsor-sale condominium at 255 East 77th Street in Lenox Hill. Alexa Lambert, Alison Black and Shelton Smith with Compass had the listing.
Commercial: The most expensive commercial transaction was $15.3 million for a 46,096-square-foot lot at 25 Wall Street in the St. George neighborhood of Staten Island. Muss Development sold the property to the New York City School Construction Authority.
New to the Market: The highest price for a residential property hitting the market is $17.5 million for a 6,735-square-foot house at 22 East 94th Street in Carnegie Hill. Thomas Wexler and Jed Garfield of Leslie J. Garfield took over the listing from Douglas Elliman.
Breaking Ground: The largest new building permit filed was for a proposed 183,386-square-foot, nine-story project at 1000 Fountain Avenue in East New York. Daniel Heuberger filed the permit on behalf of Spencer Orkus of L+M Development Partners.
— Matthew Elo
