WORLD WORLDWIDE USA New York NY New York City NYC the city THE CITY News Journal Update - The cost of tax relief for office buildings, migrants report storm chaos at Floyd Bennett Field, NYU Brooklyn hospital understaffed nurses

 

Dear New Yorkers,

The rise of remote and hybrid work has depleted occupancy at Manhattan office buildings — but the city remains on the hook for huge, long-term tax breaks created decades ago.

As part of policies to expand corporate office space, NYC doled out tax breaks attached to the development of millions of square feet of new luxury offices, such as Hudson Yards.

Now the administration of Mayor Eric Adams is preparing to grant more breaks, to help older properties that are struggling to fill offices with tenants.

Such tax breaks come with a cost: Hudson Yards alone deprived city taxpayers of $74 million in the year that ended June 30, and $309 million since 2018.

What’s more, they were probably never necessary. A little-noticed academic study published last year found that Hudson Yards’ property tax breaks were based on an erroneous projection that lowballed how much rent could be charged to office tenants.

And an examination of past property tax breaks for Manhattan office buildings shows that once granted, they can eat away at the city budget for a long time.

But successive mayoral administrations, eager to encourage development, doled out more under the premise that NYC developers are now “accustomed” to tax breaks.

Read more about the long-term costs to the city here.

Weather scoop by New York Metro Weather Tuesday's Weather Rating: 4/10. Rain has finally moved out, but a much colder air mass has replaced it. Partly sunny today with a chance of an isolated snow shower and gusty west winds. High temperatures barely scrape the low 40s. The vibes are chilly out there!

Our Other Top Stories

The heavy winds and rain on Monday morning kept hundreds of migrant families from sleeping and terrified children at the sprawling tent encampment at Floyd Bennett Field. The ordeal set off chaotic early morning confrontations between staff and residents. While city officials insisted the tents were safe and that no one was forced to leave, THE CITY began receiving increasingly panicked calls on WhatsApp beginning at 4 a.m. Two families told THE CITY that they were kicked out of the shelter in the midst of the storm and left to make their way back to the Roosevelt Hotel in the rain and wind in the pre-dawn hours with their children in tow. The tent shelters remained intact and no one was injured — but the extreme weather highlighted the conditions at the city’s remote family migrant shelter, which currently has 1,700 residents.  An independent arbitrator has ruled that NYU Langone Hospital-Brooklyn understaffed its nurses 47 times in just four months last year. The hospital is required to have no fewer than six nurses per 30 patients, according to their union contract. But it repeatedly fell short of that number.

Reporter’s Notebook

Local Law 97 Rules Finalized

Local Law 97, which limits the amount of carbon buildings over 25,000 square feet can spew, formally kicks in on Jan. 1, 2024 — but some property owners may get a brief reprieve. On Monday, the Department of Buildings finalized a set of rules, first proposed in September, that spell out how property owners can qualify for a two-year break from fines if they demonstrate “good faith efforts” to meet the new carbon caps, which will become increasingly tough in 2030 and again in 2050. The rules also encourage adopting electrification early and set financial penalties for failing to comply with other requirements.

— Samantha Maldonado

Going for Gowanus

A plan to provide big tax incentives to jumpstart residential construction in the Gowanus district of Brooklyn has attracted applications from 19 projects that could provide as many as 5,500 new apartments, Gov. Kathy Hochul announced Monday.

The formerly industrial Gowanus area went through a housing-focused rezoning process just eight months before the 421-a tax break expired in June 2022, leading developers to rush to lay down foundations to qualify for the tax break, available if they could complete their buildings by June 2026. But with many doubting they could meet that deadline, Hochul in July announced that the state would buy Gowanus properties and lease them back to the developers at a discount that would equal the benefit they would have received from 421-a.

While Hochul did not release details about which sites applied for the financial relief, real estate insiders say some projects have barely begun construction while others are well underway and are using the Hochul program as insurance in case something happens to prevent them from meeting the 2026 deadline.

The Hochul administration says it will announce next summer which projects are approved, with no limit on the potential number of projects. The governor has said she may seek to expand the program to other areas, depending on its success in Gowanus.

— Greg David

Things To Do

Here’s what’s going on around the city this week.

Monday, Dec. 18: 25Y2K, a series of Y2K-era films like “Fight Club,” “American Beauty,” “Magnolia” and more. Tickets from $17 ($10 for members), through December 30 at Metrograph in Manhattan. Tuesday, Dec. 19: Storytime at The Met Cloisters, weekly children’s book readings in English and Spanish connected to objects in the museum’s collection and the surrounding community. Recommended for kids 18 months to 6 years. Free each Tuesday from 11:30 a.m. to 12 p.m. at The Met Cloisters.  Saturday, Dec. 23: An owl birding event hosted by the city Parks Department, with park rangers who will teach about the species living in parks and the best places to try to spot them. (Bring your own binoculars). Free from 1-2 p.m. at Pelham Bay Park in The Bronx.

THE KICKER: Starting on Jan. 12, 2024, The Whitney Museum (where adult tickets cost $30 each) will offer free admission every Friday from 5 to 10 p.m., plus on the second Sunday of every month.

Thanks, as always, for reading. Make it a great Tuesday.

Love,

THE CITY

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