As developments like the Moinian Group's 605 West 42nd Street, the Durst Organization's 625 West 57th Street, and TF Cornerstone's 606 West 57th Street (pictured) take advantage of the state-run 80-20 program, some people are questioning whether that program is a good use of state resources. The program gives government subsidies to developers who set aside at least 20 percent of the units in a new development for affordable rentals, and many developers say that they wouldn't be able to complete their luxury projects without it. But, according to the Wall Street Journal, affordable housing advocates say that the cost of subsidizing the most expensive new developments is too great, and that that money would be better spent just, you know, constructing affordable housing in neighborhoods where it's not so expensive to build. The Journal breaks down some of the numbers:
[City] officials say market-rate buildings have provided about 6,470 affordable apartments since 2004 subsidized through zoning bonuses and tax exemptions. That works to about 13% of the new affordable housing units built in the mayor's housing plan, but only a fraction of the 150,000 affordable apartments the administration says were built or rehabilitated with city help during the same years. On the one hand, it certainly seems that if the money that was being used to subsidize luxury developers was instead used to build affordable housing in the outer boroughs, more of it could be built—this isn't exactly new information. On the other hand, that approach would in some ways constitute a surrender of the island of Manhattan, allowing the borough to fully become the playground for the superrich that it has, in recent years, often been accused of being. On the third hand (where'd that third hand come from?), it may not be a zero sum game—some would argue that more affordable housing is more affordable housing, regardless of how it's attained.
· Advocates Say Subsidies for Developers Misdirected [WSJ]
· Affordable Housing coverage [Curbed]