Leonard Grunstein: Bill De Blasio Should Mandate Affordable Housing

Leonard Grunstein gives insight on Mayor-elect Bill de Blasio‘s plan to increase the amount affordable housing in NYC.  While de Blasio’s plan is praiseworthy, Grunstein points out the plan is also creating apprehension within the real estate industry.  Grunstein stresses there is a vital need for more more middle-income housing in NYC, but current efforts offer small incentive to developers to build affordable housing.

“More can be done in terms of zoning bonuses or overrides for these sites to foster the creation of middle-income affordable housing.”

Grunstein goes on to explain that under the Bloomberg administration, their is a lack of focus on the creation of middle-income units and as a result, the city is missing big opportunities:

“If similar requirements had been in place for the massive Hudson Yards development, there would be an additional 5,000 units of affordable housing constructed. The thousands of people who will eventually work in that new neighborhood could have filled these apartments rather than having to commute from long distances.”

That’s an unnecessary burden for those workers as well as a loss for the city’s economy”

Grunstein advises that de Blasio should foster his relationship with the real estate industry; show that he is willing to work with them.  Choosing to mandate construction of middle-income housing would add to the long-term sustainability and vitality of NYC.  Residents of all income levels will not to be forced leave, they can continue to thrive in the city.

“The city should not leave the decision to include affordable housing up to the developer. Instead, it should have required the construction of affordable housing as part of the RFP and guaranteed the creation of a place where middle-income New Yorkers could live.”

Read Leonard Grunstein’s full article on Gotham Gazette

RKO Albee Theater Becomes Albee Square Mall (Brooklyn Cultural Landmark)

The Albee Square Mall opened in 1980 on the Fulton Street pedestrian plaza, immediately becoming a prominent spot in Downtown Brooklyn. Construction on the project began three years earlier when its namesake, the RKO Albee Theater, was demolished to make way for the development.

Albee Theater Opened in 1925 | Photo Courtesy of Frank Tilelli & William Gabel

Albee Theater Lobby (Courtesy CinemaTreasures.org – User Tinseltoes

Albee Theater Seating (Courtesy CinemaTreasures.org – User Tinseltoes

Edward Franklin Albee, a promoter, impresario and father of the famous playwright, built the Albee Theater in 1925, during the peak of the vaudeville era. With a beaux-arts exterior and an interior that featured crystal chandeliers in the lobby, paintings from Albee’s private collection and seating for 2,000, the Albee Theater sought to rebrand vaudeville and attract more affluent audiences.

After the theater’s demolition in 1978, the vacant space was developed by the Urban Development Corp., a city agency that worked to provide financial aid for the acquisition, construction or improvement of industrial, commercial, public and cultural spaces. The mall was designed by Gruen Associates, a firm founded in 1951 by Austrian architect Victor Gruen. Based in Los Angeles, Gruen and his firm designed the first suburban open-air mall near Detroit in 1954. Two years later, Gruen completed his best-known work – the 800,000-square-foot Southdale Mall in Minnesota.

Gruen is largely credited with inventing the suburban shopping mall as we know it; writer Malcolm Gladwell once wrote that Gruen “may well have been the most influential architect of the twentieth century.”

Albee Square Mall (Courtesy Gowanus Lounge)

With an unassuming glass exterior, Albee Square Mall might pale in comparison to some of Gruen’s other projects. However, along with its companion, Fulton Mall, Albee Square became a cultural landmark that nurtured Brooklyn’s rising middle class, a burgeoning hip-hop culture and rejuvenated an important commercial district.

Leonard Grunstein, working as an Assistant Corporation Counsel, helped draft the land disposition agreement and ground lease structure that enabled the development of the Albee Square Mall in the late 1970s.

The Redevelopment of the Brighton Beach Baths

The Brighton Beach Baths were founded in the mid-19th century and quickly became a popular destination for local residents and vacationers. Suffering from a shrinking membership caused by competition from developments outside of the city, the Brooklyn neighborhood and its once bustling boardwalk were neglected for decades.

In 1955, however, Brooklyn developer Alexander Muss acquired 21 acres facing the Brighton Beach boardwalk, including the Brighton Beach Baths. Eventually renamed the Brighton Beach Bath and Racquet Club, Alexander Muss & Sons continued to operate the club, adding steam rooms, hot showers, a miniature golf course and tennis courts.

In the late 1980s, Muss’s son, Stephen, announced plans to replace the Racquet Club with a six-building housing development called Brighton by the Sea. The project was stalled for years by a lengthy land-use review process and opposition from local officials and members of the community. In 1998, frustrated with the complications, Alexander Muss & Sons sold the property title to Muss Development, a separate branch of the Muss family business.

Muss Development revised the plan, expanding the scope of the project to include 16 buildings. With an expected 2014 completion date, more than 50 percent of the units have already been sold. In addition to its popularity with tenants, the development has been lauded for its positive effects on the Brighton Beach neighborhood, raising property values and creating jobs.

Leonard Grunstein worked with the Muss family on the redevelopment of the Brighton Beach Baths property. Combining sometimes-esoteric forms of common ownership, Mr. Grunstein drafted a plan that permitted the phased condominium development structure of the property.

The Muss family, which has been building in New York City since 1906 and has developed more than 15 million square feet of real estate, was responsible for high-profile projects such as Forest Hills Tower in Queens and the Marriott Hotel in Downtown Brooklyn.

From Crime To CO-OP | Tudor City

Built in the late 1920’s by Manhattan real estate developer Fred F. French, Tudor City became one of the first residential skyscraper complexes in the world. Nestled in the east side between First and Second Avenues, it is bordered by 40th Street to the south and 43rd Street to the north.

At the turn of the century — before French’s development — the neighborhood was dominated by tenements and slums and was plagued by one of the highest crime rates in the city. With Tudor City, French sought to transform a haven for gang and criminal activity into a “residential enclave” that would attract the middle-class tenants who had been fleeing the city for the safety and comfort of the suburbs and outer boroughs.

Completed in 1932, this “city within a city” – as French often referred to it – is now home to over 5,000 New Yorkers and includes a number of residential apartment buildings, a hotel, businesses, three parks and a children’s playground.

2 Tudor City Place is a 15-story tower within the complex that was converted to a co-op in 1985 when Tudor City changed ownership. In 2000, Leonard Grunstein was involved in the re negotiation of the building’s ground lease, an agreement in which the tenant is permitted to develop property for a specified time. According to Barbara Corcoran, who was quoted in a 1998 New York Times article, an advantage to purchasing units in such properties is “that the owners typically keep them in excellent physical and fiscal condition…”

WVH Article-11 CO-OP Structure | West Village Tenants Association

Following two years of negotiations, the West Village Houses — a 420-unit residential complex between Bank and Morton streets — were converted to a co-op in 2004.

Built in the early 1960s, the residential complex was originally conceived by housing activists as a community-based co-op. But because of rising construction costs, the project did not attract enough buyers and was eventually acquired by private owners as a Mitchell-Lama property in the mid-1970s.[1]

The conversion was the result of a tenant-sponsored initiative that, following the owners’ decision to opt out of the state’s Mitchell-Lama housing program in 2002, sought to fight enormous rent increases and the displacement of hundreds of long-time community members.

Leonard Grunstein, who worked directly with the tenants association, was involved in the creation and financing of the Article 11 co-op structure, which was essential to the success of the tenants’ non-eviction proposal.

According to the agreement, tenants would purchase the complex from the landlord at a discounted rate. Additionally, the city would forgive approximately $19 million in interest on the mortgage loan and approve a tax exemption for 12 years.

Eventually signed by the tenants association, owners, and the Department of Housing Preservation and Development, the plan ensured that existing tenants would be able to either buy into the co-op or continue to rent their units at below-market rates. Relieved of the anxiety stemming from the possibility of 300 percent rent increases, tenants association President Katy Bordonaro applauded the Bloomberg administration’s commitment to affordable housing and its involvement in the project.

New York State Assemblywoman Deborah Glick lauded the conversion, saying at the time, “It’s the first step in what will be a long-term victory for affordable housing.”[2]

 

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[1] The Villager, “Victory! West Village Houses to become an affordable co-op,” 5/26/04

[2] Ibid.