Further to Governor Cuomo’s just announced proposal for a wage subsidy for construction workers designed to generate construction of more affordable housing in absence of 421a (yesterday’s New York Times article by Charles Bagli), my client, Martin Heistein Esq. of Belkin Burden Wenig & Goldman, opines:
“This is an excellent attempt by the Governor to revive the 421-a rent abatement program, which will once again be an incentive for owners to build new residential buildings. And the one thing that NYC desperately needs is additional housing. It is crystal clear that without any kind of tax incentive, it just doesn’t pay for New York developers to build here in New York. And the one thing that everyone can agree on is that without new residential construction, everyone loses – the City/State lose tax revenue; newcomers to New York are unable to find decent apartments; the ever increasing tight market will continue to squeeze low and moderate income tenants; and most importantly, a lack of construction will result in the drying up of good paying jobs in construction. New York has a critical need for more housing and without the 421-a tax abatement and new residential construction, New York’s economy will be devastated.
The prevailing wage issue has been a stumbling block in the past and this initiative attempts to finesse that issue. On the one hand, the powerful unions were fighting hard to maintain that all new development projects pay prevailing wages to construction workers, while the developers maintain that paying higher wages would result in substantially higher construction costs. This attempt by the Governor attempts to carve out a compromise, so that the needs of both the unions and property developers are met halfway.”
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BBWG, established in 1989, is a full-service real estate law firm with offices in New York andConnecticut. The firm has more than 40 seasoned lawyers counseling business professionals, investors, landlords, residential homeowners and commercial property owners throughout the region in complex transactional and regulatory real estate law matters. www.bbwg.com
