Due to Lakeview’s Unique Proximity to Central Park, Its Street Rent Value Along Fifth Ave is Significantly Higher Than Its Market Rent Value in East Harlem; Lawmakers are Fighting to Keep Lakeview Affordable and Keep Families and Seniors in Their Homes
Schumer, Espaillat Say HUD Should Ensure Lakeview Apartment’s Affordability By Matching Street Rent NOT Market Rent; Lakeview Would Need Significant Increase in Fair Market Rent Cap to Meet Gap in Street Rent Vs. Market Rent
U.S. Senator Charles E. Schumer and Rep. Adriano Espaillat today called on the U.S. Department of Housing and Urban Development (HUD) to preserve affordability for hundreds of units at Lakeview Apartments, one of the last remaining Mitchell-Lama developments in East Harlem. Many of its tenants are dependent on some form of federal subsidy to keep their rent affordable. Despite the dire need for affordable housing in this section of the city, Lakeview Apartments may be another property that leaves the state-guaranteed affordable housing program.
Due to its location overlooking Central Park North along Fifth Avenue, Lakeview has presented a unique challenge, one where the street rent is significantly higher than the market rent. Today, the lawmakers made the case that Lakeview would need a significant increase in the 120 percent of fair market rent (FMR) cap in order to meet the gap in street rent to market rent. Therefore, Schumer and Espaillat are urging HUD to ensure Lakeview’s affordability by matching the street rent.
In their letter, Schumer and Espaillat said, “We urge HUD to continue to work to tailor an agreement that will ensure Lakeview’s affordability by providing comparable market rent. The current area FMR cap is 120% and Lakeview would need a significant increase in the cap to meet the gap in street rent to market rent. . . Preserving quality housing and affordability at the Lakeview Apartments is a solvable request for citizens that desperately need it.”
“An affordable complex like Lakeview is a precious and rare asset that provides a safe clean and affordable place to live for hundreds of hard-working families and seniors and HUD needs to use every tool in the box to preserve this complex’s affordability,” said Schumer.
“The Lakeview Complex is an example of our ability to provide affordable housing for New York residents and it is up to us to ensure that it remains an affordable and accessible option for residents within the community,” said Espaillat.
Lakeview has an existing Rental Assistance Payment (RAP) contract with HUD that has been extended for a short term and with the adjustment Schumer and Espaillat are calling for the complex will be able to participate in the Rental Assistance Demonstration (RAD) program. The RAD program allows the owner the opportunity to “convert” their assistance to a long-term, Section 8 Project Based Rental Assistance contract. This program will provide the owner the opportunity to facilitate the financing of improvements. Over $20 million in repairs will be able to be made to improve utilities throughout the building. Schumer and Espaillat are urging HUD to work to tailor an agreement that will ensure Lakeview’s affordability by providing comparable market rent.
A copy of their letter is below:
Ben Carson, Secretary
US Department of Housing and Urban Development
451 7th Street SW
Washington, D.C. 20410
Dear Secretary Carson:
We write to seek HUD’s intervention to preserve Lakeview Apartments, a four building affordable housing complex in Manhattan, NY. Lakeview’s 446 units, built originally under the Mitchell-Lama program, have been home to families and elderly individuals since 1974. For the past few decades, the property has participated in a variety of affordable housing programs, allowing the development to house low- and middle-income populations – something that is increasingly precious and rare in Manhattan’s ever-more expensive housing market. In order to maintain this development as part of New York City’s affordable housing stock, we urge HUD to match the comparable markets rents of this location.
As with many metropolitan areas, rent has become increasingly expensive in New York City. High demand and low vacancy rates have made it difficult for families to relocate; in fact, the vacancy rate in New York City is below four percent. Additionally, families have faced countless hurdles finding housing as more and more properties have left affordable housing programs. HUD has been an essential partner – with the city, the state and private owners – in finding innovative ways to support these families with policies that provide access to affordable housing. Due to its location in what has evolved, over time, into a high rent area, Lakeview has presented a unique challenge, one where the street rent is significantly higher than the market rent. Roughly fifty percent of Lakeview’s tenants are dependent on some form of federal rent subsidy, demonstrating the dire need for affordable housing in this section of the city.
The owner, tenants association, City and State of New York have come together to help maintain this vibrant community. Lakeview has an existing RAP contract that has been extended for a short term. With help from the Rental Assistance Demonstration (RAD) program, Lakeview will enter into a PBRA contract that will guarantee affordability for the next 20 years. Additionally, through the RAD program more tenants should be able to access these affordable housing programs, as tenants under 95% of AMI will be included. I urge HUD to continue to work to tailor an agreement that will ensure Lakeview’s affordability by providing comparable market rent. The current area fair market rent cap is 120% and Lakeview would need a significant increase in the cap to meet the gap in street rent to market rent.
Preserving quality housing and affordability at the Lakeview Apartments is a solvable request for citizens that desperately need it. Thank you for considering our request and for remaining attentive to this matter. We value your partnership and look forward to furthering our shared commitment to preserving accessible, affordable housing.