The city, state and feds must push as never before to build housing here
When we speak of New York City’s housing policy, we tend to focus on the immediate issues at hand: the migrant crisis, homelessness and apartment affordability for everyone from our lowest-income residents to our essential workers. While these stories dominate metropolitan news today, business reporters present a different gestalt with tales of empty office buildings, hybrid professional workers and the potential for a severe correction in our commercial real estate sector.
For a brief, breathless moment last year, our city’s “permanent government” held hope that these two crises were each other’s cure — office-to-residential conversion! All those empty commercial buildings could house our huddled masses yearning to breathe free. Yet in the time since those frenzied conversations first held our collective imagination, the tough realities have set in, and we have all been tempest-tossed.
For reasons both physical and fiscal, such conversions look to be limited in scope and scale, meaning that the dual crises of housing affordability and commercial vacancy rage on, unabated.
Our lawmakers don’t help. The governor and mayor, to their credit, attempted bold housing reforms that included strong incentives for both transforming older office buildings and creating new apartments across the city and state, but too often Albany is a graveyard for the good. The City Council seems to have moved on, just a little, from the NIMBYism that dominated the de Blasio doldrums, yet far too many progressives still don’t understand the cautionary tale that is San Francisco, the tinder box that haunts, or should haunt, our collective urban psyche.
We need to recast massive housing investment as the economic stimulus package New York City needs to avert decay, if not disaster.
Today every city confronts an existential challenge in the face of hybrid work given that, up until the pandemic, most municipal budgets relied heavily on taxes from commercial real estate to fund its public services, which is a particular vulnerability for Gotham. About 40% of the city’s property tax revenue comes from commercial buildings, approximately $29 billion — adding up to a huge share of the city’s $107 billion budget. To state this isn’t simply a cry-me-a-river woe for office landlords and real estate titans, many of whom indeed elude sympathy. Our small downtown businesses, from pizza places to shoe shine stalls, now see far less foot traffic, and that, for only a few days a week. Most retail businesses operate on less than a 20% net profit margin, so if a midtown restaurant loses just its Friday lunch and happy hour customers before they commute home, it faces peril unless new local residents can pick up the slack.
The lesson here is we should see our current housing and commercial crises as intertwined, but not because of a fairy tale that we will magically transform huge numbers of our office buildings into people’s homes. Instead, we need to redouble our efforts for substantial new housing production, expanding upon what the governor and mayor have already proposed, not only to address home affordability, but as a bulwark against overall economic decline: We need to recast massive housing investment as the economic stimulus package New York City needs to avert decay, if not disaster.
With commercial leases resetting and businesses seeking smaller offices, we do risk a return to the bad old days of the 1970s in which a shrinking tax base leads to fewer municipal services, which leads to more crime and more misery for the poor, and so on, in a vicious cycle. While this much-discussed doom loop is not nigh for New York City, the Zoom loop of hybrid work is here to stay, and to this tectonic shift in urban economics, we must respond with a policy shift of similar magnitude, because what is far worse than an affordability crisis is what happened to the slowly recovering, once wealthy city of Detroit.
This enormous industry is today our city’s sleeping giant, in deep slumber because it lacks the policy and tax incentives to overcome the enormous cost of doing business in our byzantine metropolis.
We need more residents — and for them, more residences. We need those residents to revitalize our bodegas and nail salons and turnstiles. We need teachers and actors and first responders not only to be able to afford their homes, but to have choices about where and how to live across all five boroughs. (I leave for a separate article the need for our police officers to live in the communities they serve as a primary means of criminal justice reform.) We need to repair or, in many cases, replace the decrepit apartments that NYCHA residents have abided for too long. We need to rethink much of the housing that sits in harm’s way due to climate change.
And not to be overlooked, we need all this new housing not just for the housing itself, but for the jobs and the taxes all this construction would generate. Building housing requires the toil of many, from those who finance it to those who design it to those who construct it. This enormous industry is today our city’s sleeping giant, in deep slumber because it lacks the policy and tax incentives to overcome the enormous cost of doing business in our byzantine metropolis. As I look across Manhattan today, I can count on one hand the number of construction cranes; above most of the island, I see far too much unwelcome sky, and all that it portends.
Writing as an architect who among other things designs affordable multi-family housing, is such a call for more of it self-serving? Damn straight, because my employees need shelter and food and health insurance too. Consider this a letter from the front lines — it is way too quiet on the housing front, a calm before the storm.
It is time to marshal massive federal, state and local effort to make this New York’s decade of home construction, with the goal of our city housing more than 10 million residents in the next 10 years.
The efforts of Gov. Kathy Hochul and Mayor Eric Adams have been laudable, but because they cannot overcome the objections of their legislative branches, our housing production remains sclerotic. And yet housing is the only economic sector for which we know there is demand, where we know that if we build it affordably, people will in fact come. In public policy, there are few silver bullets, but in New York City, attainable housing is the holy grail.
It is time to marshal massive federal, state and local efforts to make this New York’s decade of home construction, with the goal of our city housing more than 10 million residents in the next 10 years. (New York City houses approximately 8.5 million residents today, so such an increase would represent growth not seen since the early 20th century.) From Ed Logue to Ed Koch, there is precedent for such ambitions, yet ours is an unprecedented moment. Rather than focus on arbitrary targets, however, let’s commit to build wherever there is room near current or future mass transit, across all five boroughs, with new towers where there are towers, new mid-rises where there are apartment blocks, and new townhouses where there are houses. Akin to what Mayor Adams and City Planning Chair Garodnick have been advocating, let’s not just fund it, but fix it, meaning taking on the crazy regulatory mandates that make construction so unaffordable. And when we speak of adding new homes, let’s speak not just of numbers but of neighborhoods…well-designed places that need public space and social infrastructure to make them vibrant new patches in New York City’s quilt.
Such an influx of New Yorkers would revitalize our subways and buses, make our streets and parks safer by adding eyes where there are few today, replenish our schools by bringing back the Black population we are currently losing, and, over time, renew the demand for our empty offices with new entrepreneurs and businesses we cannot foresee.
The poem of Emma Lazarus affixed in our harbor and hearts needs no new mention here, but we should recall its name — intended for both the statue and the city it imagines — “The New Colossus.” Were Lazarus with us today, I’m sure she would remind us that a colossus may have many struggles, but what is not in its being, what it does not and cannot do, is shrink. It is, for New York City, unbecoming.