NYU Schack Panelists Address the Big Apple’s Housing Needs

New York City Mayor Eric Adams at the NYU Schack Institute of Real Estate’s 55th Annual Conference on Capital Markets in Real Estate

“New York is not coming back, New York is back,” said New York City Mayor Eric Adams at the NYU Schack Institute of Real Estate‘s 55th Annual Conference on Capital Markets in Real Estate. Along his journey to becoming mayor, Adams realized that the economic stimulus was public safety. “People must feel safe. If you create a safe environment, and you build it, they will come,” he told attendees.

According to the Adams, New York City must become a city of “yes.” This means saying yes to any housing development that benefits the community and agreeing to its completion in your own backyard.

To work toward solving the housing supply crisis, real estate needs to think differently, leading the way instead of following. Mayor Adams believes this entails being the testing ground for new ideas and products, rethinking land use, having agencies offer opportunities as opposed to citations, building a fire department that shortens the queue for inspections and more. The list of ideas toward building a safe city with enough housing continues, and further, it revolves around changes that can start with the real estate industry.

Larry Silverstein, chairman of Silverstein Properties, agrees. “This mayor is determined with everything within him to make this city the best it can possibly be. He is giving it his all,” said Silverstein.

With New York City facing multiple billions of dollars in deficit, what do we do for the city? Real estate, which pays $35 billion in taxes annually to the city compared to $30 billion in tax revenues, is an essential component, according to Silverstein. It is likely the case that many landlords are not going to be able to hold onto their buildings in the next two years. However, this suggests that there many be many new opportunities.

“It’s one hell of a time to pull some resources together and acquire from some of these lending institutions at a significant discount,” Silverstein said about the potential opportunities in the next few years.

READ ALSO: Is Conversion the Solution to California’s Housing Crisis?

Marty Burger, CEO of Silverstein Properties, spoke of one of the ways in which opportunities may arise: vacant buildings and office spaces throughout Manhattan. “There are ways to take obsolete buildings and make them not obsolete,” said Burger. “There is a very low vacancy rate in New York City, so there is this perfect storm.”

With more than 100 million square feet of Class B and Class C office space, combined with the desperate need for more housing, converting could be the answer. According to Bill Rudin, CEO & co-chairman of Rudin Management Co., the new model for the city will be conversions. People want to live in urban environments as well as have the opportunity to walk to work. Some of the spaces in Midtown, as well as along Fifth Avenue, have the potential to be converted into residential buildings.

First, however, we need government and leadership to make these conversions possible. Development, rehabilitation and preservation takes funding, such as the $1.4 billion financing package NYC committed for affordable earlier this year, as well as policy making. Scott Rechler, chairman & CEO of RXR, said, “There is a need to hold elected officials accountable.”

Once officials and policymakers are able to make the process of converting and building multifamily communities more manageable for developers and property owners, the city can begin to solve its housing crisis. MaryAnne Gilmartin, founder & CEO of MAG Partners, told attendees that there is no risk of overbuilding on the multifamily front. “This is the solution to aging office,” said Gilmartin.