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The New York City Council approved a rezoning plan on December 5, clearing the way for 82,000 new apartments and $5 billion in infrastructure and housing development over 15 years.
It marks the biggest zoning change since 1961.
The Yes for Housing Opportunity City plan was passed by a 31-20 vote amid a citywide vacancy rate of 1.4%. The Regional Plan Association projects that New York needs 473,000 additional housing units by 2032 to meet demand.
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Mayor Eric Adams launched the plan after data showed job growth outpaced housing development across New York for four decades. The zoning overhaul allows developers to build more units in areas where households earn 60% or below the Area Median Income, eliminates parking requirements in target neighborhoods and creates two high-density zones.
Under the new rules, property owners can more easily convert empty offices into flats.
Churches and campus properties receive extended rights to erect buildings, while homeowners are allowed to add basement units and backyard cottages in designated areas.
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“It's going to create a lot more opportunities and hopefully ease some of the rental burden on tenants. It's nice to see that we're moving away from the NIMBY mentality and we're building a pro-development sentiment in the market,” Sean Kelly, partner at Ariel, told Forbes, which originally reported on the topic.
Real estate values stand to climb under the new rules. Ariel said the Harlem development site could increase its buildable square footage by 20%. A property in Brooklyn may see a 46% increase in floor area ratio, while an East New York location could expand development potential by 70%.
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The re-demarcation plan follows the Gov's June housing policy. Kathy Hochul, who extended the 421a tax abatement program deadline to 2031 and created tax exemptions (485x and 467m) for residential construction and office conversions.