The city’s Industrial Development Agency approved a resolution changing the uniform tax exemption policy in the area containing the Hudson Yards development site, Crain’s reported. In particular, the expansion of the relevant zone is not the same as obtaining the desired tax benefit for Related.
The fifteen-member board – partly filled with mayors appointed – almost unanimously approved the change to the uniform tax exemption policy. The exception was Comptroller Brad Lander, who supports the project but not the use of city funds.
“We are concerned that the economics of the project as currently constructed appear to rely too heavily on city intervention in favor of the private developer and the MTA,” Lander said in a statement.
Related did not comment on the outlet’s vote.
Jeff Blau’s company is asking the city for a $2 billion tax break to finance construction of a platform over the open rail lines. Critics of the proposed tax break see it as a bailout for the developer to build a major project on taxpayers’ dime.
Ultimately, Related wants to build four mixed-use towers on the site that will provide approximately 4,000 residential units, green space and a school.
The City Council approved the site’s rezoning in June, a month after Related dropped its bid to put a casino on the site. The changes to the repurposing of the site in 2009 also allowed for an office building and a hotel.
Related has previously indicated that the homes will mainly be rental properties. The Adams administration announced that the developer had committed to a minimum of 625 affordable apartments, up from 400. The commitment is likely driven by the affordability requirements of the 485x property tax credit.
To obtain its IDA tax benefit, Related must still complete the IDA application and assessment process, which can take approximately three months. That means the newly elected government of Zohran Mamdani – which Blau reportedly tried to prevent by bringing together fellow executives – will likely have a say in whether Related actually secures the funding.
— Holden Walter Warner
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