Mayor Adams wants housing (photo: Michael Appleton/Mayoral Photography Office)

2023 began with the promise that both the State and the City of New York would finally get their acts together and take on a housing crisis that may already be handicapping our ability to recover fully from COVID-19 and certainly threatens to hamper our growth.

The good news is that Governor Kathy Hochul and Mayor Eric Adams share substantially similar visions and that the Governor, through the housing plan in her Executive Budget, is seeking to give the City the tools critical to achieving its goals. The bad news is that the State Legislature has placed key parts of New York City’s plans to expand housing opportunities at risk by threatening not to pass those very portions of the Executive Budget.

The Governor’s budget contains legislation that would give the City authority to legalize basement apartments, grant tax abatements to buildings converted to residential use that include affordable apartments, and amend the State Multiple Dwelling Law to expand eligibility for residential conversion under special and more flexible bulk controls to non-residential buildings constructed prior to 1990. It also includes the repeal of the cap on residential floor-area-ratios (FARs) in excess of 12 – a cap that today limits the floor area of a building to 12 times the area of its lot (such as, on a 5,000 square foot lot, a building with 60,000 square feet of floor area).  

Expanding the number of buildings eligible to use special rules that ease residential conversions should be a no-brainer. It gives hundreds of office buildings that may no longer be operationally feasible because of reduced demand for office space a second chance at life through adaptive reuse. It gives the City the raw material to create thousands of new apartments and make a dent in its unbalanced housing market and, if married to appropriate property tax relief, to expand the supply of affordable apartments into neighborhoods where there are almost none today.

It ensures that the City’s Central Business Districts evolve from their pre-covid lives as vital centers of commerce into active 24-hour communities; it provides long-term support for the City’s tax base; and it conserves both the natural resources that have gone into the construction and maintenance of the converted buildings and the natural resources that will not have to be spent on demolition of the existing building and its replacement structure.  

The elimination of the 12 FAR cap on residential floor area has been a part of State housing proposals for many years. And for just as many years it has been quietly killed by legislators who have bought into the canard that repeal of the cap will immediately open the floodgates to out-of-scale development that will overwhelm the City’s neighborhoods. Nothing could be further from the truth.  

In fact, the elimination of the cap by itself will not change any of the zoning rules affecting new construction. Any change must first be incorporated into the City’s zoning law, which can only be done after long and very public land use and environmental review processes. Nor will it overwhelm the City’s residential neighborhoods; the areas certain to benefit from the change are the City’s Central Business Districts, where development is already permitted at more than 12 FAR and where substantial buildings are already permitted. And it need not lead inexorably to super-tall buildings. As demonstrated by some of the most admired and contextual 12+ FAR buildings in the City, including such landmarks as the Beresford and Carlyle Hotel, building form is primarily a function of envelope controls and not of FAR.  

The elimination of the cap is also critical to the success of the expanded residential conversion program, because so many of the newly-eligible buildings were developed to more than 12 FAR. This will encourage the use of the recently-adopted floor-area bonuses for transit improvements by allowing all bonus floor area – both generated by affordable housing and generated by a subway improvement – to be used for residential use; and it offers a framework for incentivizing affordable housing in the City’s Central Business Districts, where there is virtually none today.  

The gravity of the housing crisis and the importance of a revitalized, post-covid New York City have led to an almost unheard of agreement between a Governor and a New York City Mayor – an agreement that can give the City tools it needs to create new housing, recover, and grow. At the same time, the actions of the Legislature in stalling these initiatives, all of which should be beyond controversy, demonstrates the measure of our political dysfunction today. The Legislature should give the City the help it needs by passing the City-oriented housing proposals in the Executive Budget without further ado.   

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Paul D. Selver is co-chair of the Land Use Department at the Manhattan law firm Kramer Levin.