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The bottom line is that Mandatory Inclusionary Housing is a lot more onerous to developers trying to build market-rate units than was expected. This was an issue even before 421-a expired. Leftist opponents and pro-development supporters were both wrong
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Erik Engquist
The 2016 East New York rezoning was supposed to produce 6,500 homes by 2030. Halfway to that date, only 600 have been added, @NicoleRosentha7 reports in @trdny Our story shows the predictions of critics and supporters of the rezoning were both wrong.
David Watson 🥑
NYC Planning is very professional, they commissioned a market study that was infinitely more sophisticated than what Philly did. The problem though is that fundamentally to design an IZ program, you need to know how much perceived profit is in every piece of land, and that’s…
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Land is already worth negative value without 421... MIH obviously makes it even more burdensome...
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Eli Lever
421a effect on NYC developments... (The tax abatement which is now gone) Rough numbers of a deal we are looking at: UYOC with 421a - 6.91% UYOC w/o 421a - 4.73% What we need the cost of land to be to get the same UYOC - minus $69/sqf (-$5,175,000 total)
Can a city buy up land before rezoning, or pass a law capturing the upside prior to a rezoning? If the city owned parcels in East New York before rezoning, it could accelerate development. This would make no one happy, but we’d end up with more homes.
Sounds like a job for the government. Expecting the private sector to get us out of this mess is an even bigger fools errand than expecting the private sector too.