By Bill Parry
Jay Valgora’s legacy is in limbo because of an expired tax abatement. The architect behind the mammoth Hallets Point megaproject thought his grand vision of the East River becoming New York City’s new Central Park was in motion as he stood off to the side at a ground-breaking ceremony in late February.
Mayor Bill de Blasio joined a host of elected and community leaders in a warehouse across the street from where construction had already begun on the first phase of the development, a building that will contain 405 apartments, 81 of which are affordable units.
The $1.5 billion Hallets Point complex, when completed, would consist of 2,400 units, 484 of them affordable, a supermarket, a school, a waterfront esplanade and 68,000 square feet of retail space, breathing economic life into a part of the borough that hadn’t seen any in decades.
“I was just watching all of the residents of the Astoria Houses who I had worked with for nearly a decade,” Valgora said. “This community had tremendous support for the project because they had been underserved for so long, especially their great leader, Claudia Conger.”
Conger, the president of the Astoria Houses Residents Association, herself a resident for more than 50 years, told the crowd, “For decades there has been talk of revitalizing and reconnecting this community with the rest of our neighborhood, but those efforts have always fallen short.”
As if on cue, the following day the Durst Organization and Lincoln Equities announced the next phase of development would be on hold for the time being: The 421-a tax abatement had expired and made the taxes too expensive to continue. The program provided vital tax abatements to residential developers by eliminating property taxes in exchange for a higher number of below-market-rate apartments.
“Building One qualifies for 421-a and is under construction and on schedule,,” Durst Organization spokesman Jordan Barowitz said. “Without 421-a, the rest of the project cannot proceed.”
The deal for the developer tax break collapsed after the Real Estate Board of New York and the Building and Construction Trades Council failed to reach agreement on prevailing construction wages. The announcement was a crushing blow to the residents of Astoria Houses, the NYCHA campus that had so much to gain with jobs, retail options and a better place to live. Residents were to have rental preference for 50 percent of all the affordable housing units.
It was also a crushing blow for the de Blasio administration. The four decade-old tax credit was key to the mayor’s ambitious Housing New York plan, which has already financed more than 40,000 affordable apartments — enough for more than 100,000 New Yorkers.
“Until we have a smart, effective tax abatement program that incentivizes the construction of rental housing across market types, we’ll see luxury condos being built in the hottest neighborhoods instead of the mixed-income housing we so badly need,” de Blasio spokesman Austin Finan said. “We are making huge strides in building affordable housing for New York families, and we will continue to do so, but putting a program like 421-a back into our tool box will help us get there faster, and more efficiently.
Watching this all unfold is Valgora, an urbanist and city planner who spent the last decade working on the Hallets Point project, as well three other projects nearby on the peninsula.
“The shortage of affordable housing is the most pressing issue facing the city and I don’t know if the city understands the effect that 421-a’s expiration has had on housing,” Valgora said. “There’s no question that the failure to extend it has put a hindrance on that magnificent project and all other residential projects as well. It’s very disappointing and it is hard to see any end in sight.”
Valgora’s vision was to create resilient and sustainable communities along the neglected former industrial waterfronts of New York City connected with ferries and water taxis. Hallets Point was to be the harbinger.
“When you look across to Roosevelt Island and you see the buildings rising on the Cornell Tech campus, it’s painful to think that will be the first stop on the new Citywide Ferry service next year,” Valgora said. “Professors and students living at Hallets Point just a five-minute ferry ride to work. That’s the prefect world right there.”
Valgora is also disappointed because the 100-year-old family-run Durst Organization was making Hallets Point a model for environmentally sustainable residential living. Hallets Point is “off the grid” with three of its own power-generation facilities as well as a Blackwater reclamation system which recycles wastewater on site.
“Building in New York is very hard for developers, so complex and the risk so high,” Valgora said. “And here you have the Durst Organization, a multi-generational, family-run, long-term New York City developer committed to the highest quality projects like One World Trade. If they can’t go forward with this project without the tax abatement, who can?”
2030 Astoria Developers is in a similar situation with Astoria Cove, another megaproject that Valgora worked on for another underutilzed area on the peninsula. That development would have 1,723 apartments, 27 percent of them affordable.
“The Astoria Cove project will bring to this community much-needed infrastructure, housing, retail, jobs, economic development, along with a world-class waterfront esplanade and much-discussed public ferry service to connect this previously isolated neighborhood to the rest of the city,” said John Mavroudis, developer of the Astoria Cove project. “It is an excellent project for the city and the surrounding community. Projects like this were conceived with the 421-a in mind and we rely on its reauthorization in order to move ahead.”
Valgora believes politics, like real estate, is cyclical and a solution to the city’s affordable housing crisis must be found.
“I’m confident that the whole peninsula will be developed with multiple projects,” he said. “But the delay in extending 421-a is creating a significant drag on development and hindering this from happening anytime soon.”
Reach reporter Bill Parry by e-mail at bparr
