TRANSCRIPT: Facebook Chat with Donald Capoccia, President, NYSAFAH

By Jessica Fiur, News Editor

New York—On Friday, March 8, Donald Capoccia, president, New York State Association for Affordable Housing (NYSAFAH), participated in a live chat on the MHN Facebook page to answer readers’ questions about affordable housing and construction.

Below is a transcript of the chat session.

Capoccia: Hi, I’m Don Capoccia, president of the New York State Association for Affordable Housing. I’m looking forward to answering your questions!

Question: What advice would you give to young people looking to get into affordable housing development? Thanks.

Capoccia: The best advice is to get familiar with all the different aspects of housing production and development, from site acquisition through to financing, construction, understanding how to manage the complete and stabilized asset. You don’t have to be a master of all of these, but it’s important to understand the entire process as a start. And once you understand that with a little entrepreneurial DNA and some determination, you should be able to find a place in that world.

Question: What areas of NYS do you think have strong growth potential for the affordable housing market?

Capoccia: The Rochester region and the counties north of New York City—the Rockland and Hudson areas—have a high growth potential for affordable housing development. What you have in both areas is a growing senior population and it looks like there’s going to be a significant focus by the State on allocating support for affordable housing production to meet the needs of this population.

Question: What do you suggest advocates of affordable housing do to change the negative stigma of low-income housing? New York seems to have done a great job with it; perhaps you can share some of your experiences.

Capoccia: We want to focus on the substantial economic impact of the work—the job creation, both construction and permanent, and the direct and indirect economic benefits. In New York annually, $1.2 billion in public investment leverages $1.3 [billion] in private investment. In a city, region, or state, it’s important to talk about that across the entire spectrum because it has a much more significant impact.

Question: Thanks, Don. What do you foresee for the LIHTC during federal tax reform?

Capoccia: NYSAFAH is going to have to partner with other organizations across the country to make sure that the LIHTC is preserved through tax reform—and if we can make a strong enough argument on the economic impact, even further expand it. The Bipartisan Policy Center just called for a 50 percent increase in LIHTC.

Question: Welcome, Mr. Capoccia! What are your thoughts about building mixed-income/mixed-use developments on NYCHA land, and how can developers avoid the clash with tenant groups who seem to adhere to the belief that only public housing should be built on these sites.

Capoccia: Thanks for your question. We meet with tenant groups regularly and provide NYCHA residents with opportunities to actually work on the projects. When it’s time to market units, we invite these residents to participate in the lottery.

As far as mixed-use development, one of the best ideas is to find a way for NYCHA to bifurcate existing buildings from underutilized or undeveloped sites and let the two operations be run separately: one by an asset manager and the other by a development production division.

Question: Hello Don, what are your thoughts about the billion dollars coming from Governor Cuomo for opportunity for homeownership? Do you see any of that money going to affordable homeownership?

Capoccia: As the budget becomes more refined and the Senate and Assembly get more involved, there’s no doubt that some of the additional funds will support home ownership.

Question: To what extent do you think affordable housing development can contribute to maintaining the character and demographics of rapidly gentrifying communities?

Capoccia: The extent is significant to the degree that you have the opportunity to produce it. Whenever there’s an opportunity to produce or build affordable housing in a changing neighborhood, it’s always a great opportunity to be able to house some of the existing population so that ultimately the neighborhood doesn’t completely lose its original character.

Question: Don, first off thanks for taking the time to field our questions this afternoon, it is very much appreciated. I am curious, as Q2 of 2013 approaches have you observed any change in technology trends? What primary initiatives are you seeing companies take this year?

Capoccia: From our own experience, we’re hiring an architecture firm that will detail and coordinate the structural and mechanical components of our project rather than leaving that to the individual contractors and suppliers. This gives us much greater control and a clear understanding of the coordination challenges that we’re facing in any particular job.

What this essentially means is that we’re able to virtually construct the building in a 3D model that can be viewed on a computer screen. What’s new about this process is bringing in a design professional to oversee this single critical component of constructing the project, whereas in the past it was managed by any number of separate professionals.

Question: How do you think the state of affordable housing in NY compares to the rest of the country?

Capoccia: We believe that New York is leading the country in efforts to expand affordable housing production opportunities for our industry across the state. I’m unaware of any other state that’s made the billion-dollar commitment to affordable housing that Governor Cuomo has, especially in this economic climate. He clearly understands the economic impact of our industry.

We’re very lucky in New York, across the state and the city, to have some of the most creative housing technicians in the country. Through that creativity we’ve been able to leverage private investment so that it’s had a multi-billion dollar impact across the state. At NYSAFAH, we’ve understood the importance of that and we’ve commissioned an economic impact report with HR&A that’s been a very effective tool with our elected officials.

As the trade association for New York’s affordable housing industry, we also think it’s important to take a moment to mention the importance of taking a leadership role in supporting emerging developers, particularly MWBEs.

We’re involved in an effort to bring MWBE joint venture partners into our projects. Previously, what the city and the state have looked to do is expand employment, subcontracting opportunities, but this is the first time that there’s been a push to put an MWBE into a partnership role and get involved in a business that they otherwise would not have had the opportunity to do. You’re at risk to the degree that you’re going to get a return and you’re accountable for the success of one or two components of a particular development project.

We hope to see you at New York Annual Affordable Housing Conference on May 8th at the Marriott Marquis in Times Square. It’s one of the largest housing events in the country, with more than 1,400 housing professionals attending: http://nysafah.org/conference.php.

Thank you all for your engaging questions!

Note from the editor: Please note that information, such as names and locations, were omitted from the transcript to protect our readers’ privacy. Additionally, the questions and answers have been edited for spelling and grammar.