Since One57 has basically become the poster child for the anti-421a movement, the city's Independent Budget Office decided to look into just how much the Extell-developed megatower profited from the the program, and the results of the study pretty much support everything that the controversial tax abatements opponents have been saying. In exchange for $65.6 million in property tax breaks, Extell spent a mere $5.9 million to help build 66 affordable apartments in the Bronx. Had the city just taken that $65.6 million and spent it directly on affordable housing, the study says, it would have resulted in nearly 370 units.
In June, when the 421a law expired, the state legislature voted with Mayor de Blasio to redesign the program and bar most condominium buildings from receiving 421a tax breaks, while requiring all rental buildings to include affordable housing. The revised program will reportedly cost the city $3.3 billion in forgone revenue over 10 years, while the previous one cost $1.1 billion annually. "The staggering cost and inefficiency of this program is precisely why the administration sought—and succeeded—in ending 421-a tax breaks for luxury condominiums," de Blasio spokesman Wiley Norvel said. "The practice was just indefensible."
· Study Details Cost of Tax Break for Luxury Manhattan Condo [WSJ]
· Study: One57 gains more from tax system than 421-a [Capital]
· 421a coverage [Curbed]
· One57 coverage [Curbed]