Real estate investment trust AvalonBay’s forthcoming 1.3-million-square foot East Harlem rental complex will include a 68-story residential tower and three schools, as well as retail space, according to The Real Deal.
Of the project’s 1,100 rental units, 30% — 330 units — will be reserved as affordable housing for income-qualifying tenants.
The project was developed in partnership with the New York City Department of Education. It is situated on ground-leased land from the city. The developer team has been encouraged to hire local, non-union labor.
AvalonBay will spend roughly $550 million to develop the multifamily portion of the site, while the construction of the education facilities will be funded by the city’s Education Construction Fund via tax-exempt bonds, according to The Real Deal. The bonds would be repaid through lease income.
The news follows the recent revival and update of the city’s 421-a tax credit, which incentivizes developers to set aside 20% of a project’s units for low- to moderate-income tenants in return for a 35-year tax break, up from 20 years in the previous version. Under the agreement, projects would be required to maintain the affordable designation for 40 years.
Both the tax break and AvalonBay’s latest project reflect a push by city officials to provide 200,000 new or existing affordable homes in the next decade.
Last week, an online tool from New York University’s Furman Center for Real Estate and Urban Policy launched to track housing and neighborhood data for the city, including subsidized housing, foreclosure notices, median home sales price, renting affordability and more.
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