He thought it would be Atlantic Yards, but developer Bruce Ratner’s first residential building in Brooklyn will actually be this 34-story rental tower on DeKalb Avenue in Fort Greene.
Ratner has closed his financing deal on the $200-million Costas Kondylis-designed “green” building on the block between Hudson Avenue and Rockwell Place this week, the company announced on Wednesday.
The building is underwritten by $109.5 million in hard-to-get tax-exempt bonds from the state Housing Finance Agency. The project calls for 20 percent of its 365 units to be set aside as below-market-rate rentals, but critics pointed out that the state subsidy means that the public will be spending $1.5 million for each afforable unit.
A spokesman for the Housing Finance Agency said such back-of-the-envelope calculations miss the larger point.
“We don’t finance only the affordable units in a building; we finance the entire building because the developer has committed to having affordable units in it,” said the spokesman, Phil Lentz. “Without our financing, such buildings would not get built, so the affordable units would not get built.”
Such bonds are increasingly difficult to obtain thanks to a boom in projects statewide and a city law that requires developers in a wider area of the city to include affordable housing if they want to receive public subsidies, said Joe Chan, head of the Downtown Brooklyn Partnership.
“It’s incredibly difficult to get tax-exempt bond financing in the current market,” said Chan. “But they [the state finance agency] looked at project readiness, among other factors. This building had the advantage of having done the initial design and site prep work.”
In addition to the fact that construction of the building has already begun, the building also differs from Atlantic Yards in its affordable housing plan. Unlike Atlantic Yards, the below-market rentals at 80 DeKalb Ave. will be insulated from market forces for 99 years, Ratner said.
For the first 35 years, 62 of the units will be available for households earning up to 50 percent of the area median income, currently $74,600 and 11 of the units will be reserved for households earning 40 percent of that figure.
After that, all 73 units will become available to households earning up to 90 percent of whatever the area median income is in 35 years.
The 292 market-rate units are expected to command top dollar. Not only is the building on the edge of both a booming Downtown and the BAM Cultural District, but it is within walking distance to the subway hub at DeKalb Avenue and Flatbush Avenue Extension, making for easy commutes to Manhattan.
Eighty-five percent of the building’s units will be studios and one-bedrooms.
Also, the building is designed to be “green,” and is aiming to achieve the so-called “LEED certification,” a sustainable design standard administered by the U.S. Green Building Council. Ratner’s statement said the building would use “low or no volatile organic compound emitting materials” and would reduce water use with low-flow fixtures.
“We’re very excited about 80 DeKalb,” Ratner said in the statement. “It is a magnificent building at a great location that will provide both affordable and market-rate homes. We believe, too, that this is positive development during a tough market and points to the ongoing attraction of Brooklyn as a place to live and work.”
Construction began last Monday and the company claims that the building will open in late summer, 2009.
Ratner’s Atlantic Yards, by comparison, is stalled. The developer says he will build all 16 buildings in the mega-project near the corner of Atlantic and Flatbush avenues, but only the basketball arena and two residential buildings currently have a completion schedule, though it is unclear when they will be built.
Ratner has said the entire Yards project will be done by 2018.