by Brian J. Pape, AIA
Previous WestView News issues detailed the history of West Village Houses (WVH) from its 1960’s inception as affordable residences in a rough area, to a highly improved and desirable residential neighborhood today. To replace dilapidated industrial and commercial buildings along the Washington Street elevated railroad, new housing, including West Village Houses, would occupy many of the former railroad lots. That history is summarized below, for reference.
West Village Houses announced the May 2022 closing of the sale of the WVH-owned parking garage at 738-742 Greenwich Street, for a market-rate sum of $64Million. Initially, zoning laws required the housing units to provide their own off-street parking, but when that law was voided, WVH no longer was required to keep this 4-story brick and concrete structure. Nevertheless, some shareholders did not want to sell the garage.
To accomplish this sale, a group of long-time WVH residents formed a group called Shareholders for the Preservation of West Village Houses (SPWVH) several years ago, when factions supported selling the co-op to a developer, displacing residents. Their goal was to continue affordability, including renters, by preserving WVH in much the same configuration as now exists. The co-op has already completed many energy, maintenance, and resiliency (flooding) upgrades and protections. Attorney Jack Lester was retained by SPWVH.
With the sale of the garage, stability and affordable maintenance charges can be maintained. 78.2% of shareholders and 6 of the 7 board members voted to approve the sale, which will benefit the shareholders directly. According to SPWVH, the sale will enable funding the $17.5Million 10-year capital repairs program that Cowley Engineering prepared. Preservewvh.org also noted that WVH has paid off the HDC loan and most of the first mortgage, and the 25% fliptax was also reduced to a 5% sales fee, consistent with other Manhattan co-ops.
The co-op’s 7 member governing board has annual elections in June. A super-majority (75%) of shareholders would be needed to change any by-laws.
The WVH co-op has many challenges, as all older properties do, and the shareholders are working to meet those challenges. Among them, if only “natural persons” can buy into the co-op, then how to deal with “Anonymous Buyers” LLC?
A brief history of WVH:
The construction of the Hudson River Railroad (incorporated 1846) along West Street completed the forty miles to Peekskill on September 29, 1849, which helped to spur commercial activity in this Village vicinity. In 1929 the West Side Improvement Project was enacted to prevent more deaths from moving rail traffic. In 1934 the first section of a viaduct opened on the west side of Washington Street, built in the ‘middle’ of the block or through industrial buildings, which benefited from the freight deliveries. A mere 30 years later the ‘High Line’ was deemed obsolete, due to trucking’s domination over rail freight and the relocation of the ‘Port of New York’ to New Jersey; in the 1960’s the south section was pulled down, and the mid-section in the 1980’s.
The Mitchell–Lama Housing Program is a 1955 New York State non-subsidy governmental housing guarantee, sponsored by New York State Senator MacNeil Mitchell and Assemblyman Alfred Lama. A total of 269 Mitchell-Lama developments with over 105,000 apartments were built under the program.
WVH was conceptualized with Jane Jacobs’ and other community activists’ help in the 1960s, and designed by Perkins + Will Architects in the 1970’s.
Bounded by Bank, Morton, Washington and West streets, the development consists of 42 five-story walkup buildings connected by gardens and other common areas.
The first residences were completed in 1974.
The city-sponsored residences got off to a rough start, both financially and aesthetically, when heavy-handed simplification of construction was forced on it to save costs.
Nevertheless, “All accounts of West Village Houses end up with Jane Jacobs being victorious,” said Mr. Alexander Garvin, a city planning official in the early 1970s who helped put together the development’s financing, citing a 1999 Ken Burns documentary, “New York.”
When in 2002 the landlord, the Island Capital Group, signaled that it might choose to opt out of the Mitchell-Lama Housing Program (per the state statute, owners may buy out of Mitchell-Lama after 20 years by paying off any government mortgages), a delegation of tenants contacted the City’s Housing Preservation & Development Department (HPD).
They negotiated an agreement where the landlord sells the 420-unit complex to the Housing Development Fund Corporation (HDFC) cooperative at a discount from market value and makes other concessions. An internal subsidy plan was funded in part by a 25% “flip tax” fee (a percentage of profit at a sale) paid to the co-op.
By 2006, 380 of 420 tenants were able buy their apartments for about $150,000 (a one-bedroom apartment on West Street, for example, yielded an initial sales price of $152, 810; a three-bedroom on a higher floor was priced at $267,614), while the other 40 kept low rents as long as their apartment is their primary residence. The co-op hired a property management firm, Douglas Elliman.
During this period, according to Real Estate Weekly, a WVH group filed a complaint accusing Governor Andrew Cuomo of misleading them about the affordability of their homes while he allegedly engaged in “pay-to-play” politics in 2006, when after leaving HUD in 2001, Cuomo was hired as a vice president of Andrew Farkas’ Island Capital firm, their landlord.
With the expiration of a community-wide tax abatement, WVH began transitioning from an affordable housing co-op to a market-rate one on March 9, 2018 when it officially lost its tax-exempt status, raising the coop’s tax bill to $3 million annually from $500,000. An indication of the apartment’s true market value can be found in the units retained by the original investors, who have listed a one-bedroom for $695,000 and a three-bedroom duplex for $1.75 million.
Then, also during that transition period, Madison Equities reportedly made an unsolicited proposal to redevelop the coop, and residents had to work to decide how to respond to it. Since by-laws only allow “natural persons” to buy into the coop, corporations like Madison would be prohibited from buying, unless the by-laws changed.
It’s a new day for WVH.
Brian J. Pape is a citizen architect in private practice, serving on the Manhattan District 2 Community Board Landmarks Committee and Quality of Life Committee (speaking solely in a personal, and not an official capacity), Co-chair of the American Institute of Architects NY Design for Aging Committee, is a member of AIANY Historic Buildings and Housing Committees, is LEED-AP “Green” certified, and is a journalist specializing in architecture subjects.
