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Busted Williamsburg: Squatters' Row and More Condo Woe

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Some have said that the precarious state of Williamsburg's building boom is most on display along North 9th Street, where squatters have taken up in some of the neighborhood's plentiful problem properties. Add another to that list, a tipster writes:

At Wythe and N. 9th, a month or so ago there were two guys who had cardboarded the landing to some fire stairs and were living under it. They even found a source of electricity and would watch TV on the sidewalk. Then someone (the bank?) put up new plywood over the windows and took out the stairs and seem to have chased those guys away. Now I see even the upper windows are blocked by new clean plywood. Either someone's trying to fix it up inside or they're trying to bring it back from the brink of squatter hovel. A squatter hovel! Sure doesn't sound very tropical, but according to New York, the Burg's pretty and vacant new condo castles make the 'hood look awfully like Miami, but with more pasty skin.

In the most doom-and-gloom State of the Williamsburg Real Estate Market address to date, David Amsden surveys the wreckage of the neighborhood's landscape and concludes that while lots of stalled and sputtering new developments may wind up as rentals, foreclosure and other dark outcomes loom for many more. "Few developers seemed to entertain the critical question of whether a neighborhood with mediocre schools and a median income of $25,892...was fully prepared to lure hordes of young professionals willing to pay Manhattan prices," Amsden writes, but Williamsburg's troubles stem mostly from tough new mortgage lending requirements and all that damn new inventory. About that:

The city amended its tax-abatement program in June 2008 to require all new buildings, no matter how small, to devote 20 percent of their units to affordable housing. "That 20 percent? It's a developer's profits," Maundrell said as we parked outside a vacant lot on North 10th Street. "What the city did is they forced all these guys to take down the existing building and drive the pile"—in other words, to rush construction far enough along that the development would not be subject to the new rules. "Most of them did it with their own money, or they took a hard-money loan at some outrageous interest rate. Well, that was just as the banks stopped lending. It was like Armageddon. You had the city looming, you had to take down your old building, and then—poof!—there was no money." He sighed. "So here we are, everyone asking the same question: What the hell is going to happen?"

In the case of Steelworks Lofts, one such stalled luxury development, the answer may be a youth hostel. Hey, that's a step up from a squat, right? OK, maybe a half-step.
· The Billyburg Bust [NYM]