Political and media reaction to a controversial plan for a “poor door” at a New York City development has been swift and loud.
The proposal to have one entrance for low-income residents living in the property’s affordable apartments and a separate entrance for those living in the building’s luxury condominiums isn't breaking any rules, but it is striking a nerve. The two-door plan has prompted calls to change city housing policies and shined a light on income inequality.
Affordable Housing Finance asked several leading developers to add their perspective to the discussion. They have focused on developing and operating affordable housing but have built notable mixed-income properties as well.
The Community Builders (TCB), a national nonprofit, has developed mixed-income properties ranging widely from 15 percent to 70 percent market-rate. That shows there’s no one formula for developing a mixed-income building.
“There are good and bad versions,” says Bart Mitchell, TCB’s president and CEO. “We’ve done good versions where units are mixed on every floor.”
There are also cases where developers have built two adjacent buildings—a strong market-rate one and a strong moderate-income one. There are also examples where placing the higher-income units all on the top floor will make a development financially feasible, points out Mitchell, a big believer in mixed-income and mixed-income neighborhoods.
What he and many others find most insulting is situations where some residents are denied use of a building’s amenities.
This is an issue for New York Assemblywoman Linda Rosenthal. Earlier this year, she introduced a bill (A09061) that would create a penalty for landlords who discriminate against rent-regulated tenants by prohibiting them access to new amenities and common areas. The bill calls on landlords to offer the use of the facilities to rent-regulated residents for a reasonable fee. Landlords who do not comply face a $25,000 fine.
“For people who have lived in their building for 30 or 40 years, now part of their building, their home, is off limits,” says Rosenthal, a Democrat who was first elected to the Assembly in 2006. “It divides the spirit of a building and creates unnecessary strife. It’s equals and unequals in a building.”
Last year, she also introduced a bill (A08330) that calls for affordable housing units to be distributed throughout a building instead of concentrated on the same floor or in the same area.
Both of these bills were introduced before the proposed poor door became big news. The controversial Upper West Side development is involved in the city’s Inclusionary Housing Program, which gives developers a bonus to their building size or the ability to sell the bonus to other buildings in exchange for providing permanent affordable units. Extell Development Co. is proposing 219 luxury units, with views overlooking the Hudson River. Fifty-five affordable apartments for households earning no more than 60 percent of the area median income are proposed in a building segment.
Although developers have received inclusionary zoning approvals, they have not used the bonus at the building, according to city housing officials.
Inclusionary housing policies
The poor door has put the spotlight on New York City, but other areas aren’t immune.
“With many communities having inclusionary housing policies, the issue of separate entrances or segregated facilities, if permitted, could potentially pop up in other areas of the country,” says Todd Cottle, principal at C&C Development Co in Tustin, Calif..
However, he’s yet to see separate affordable and market-rate entrances in a building in the Southern California region where his firm operates.
C&C and many other affordable housing developers make it a point to integrate the units in a way that makes them indistinguishable from one another. “We feel that’s best for the community,” Cottle says. “Segregated housing with separate entrances is not what we want to see and not what inclusionary policies intended.”
Jim Grauley, president and COO of Columbia Residential in Atlanta, has developed a number of award-winning mixed-income properties. “We don’t differentiate between unit finishes, features, and floor plans between market-rate and affordable rentals,” he says. “In many cases, we have three or four levels of housing in our developments with affordable and market-rate apartments scattered proportionally throughout the development or building.”
He says inclusionary zoning or set-aside should require that low-income units not be segregated in a mixed-income building or development.
Grauley also makes another point—the market matters. “The larger the differential between market and affordable units, the more pressure upon these kinds of issues will arise,” he says. “Thus, the issue is more acute in a Manhattan context than it would be in some lower-cost cities.”
The developers stress the success and importance of mixed-income developments.
“The key social contract that makes this work is to have a high standard of quality, service, and value proposition for everyone, coupled with an expectation that all residents should adhere to community values and standards,” Grauley says. “We are convinced that the mixed-income model allows low-income families a better environment to succeed than in a concentration of all low-income families. Further, we are able to develop and manage these communities in a way that lifts the value of the broader community and spurs other investment around our sites.”
