Lawyers Ponder Effects of New Mayor's Policies on Clients
Lawyers representing real estate developers and major employers say they are wary of the impact on their clients of a change in policies under mayor-elect Bill de Blasio.
"I don't think people are feeling good about what's to come vis-à-vis real estate development and even issues for the financial community," said Warren Estis, founding partner of real estate firm Rosenberg & Estis, who represents developers, landlords and financial institutions.
"Everyone is concerned. We don't really know where he's going," he said.
As an example, Estis pointed to proposed reforms to tax incentives. De Blasio has said the city should restrict tax incentives to projects that would not have gotten off the ground without a tax break or to those that provide significant public benefits.
De Blasio has said he will require developers to include affordable housing in rezoned areas and that he wants to create 50,000 new affordable housing units.
"There's nothing on the table that he's proposing to benefit the real estate industry or to spur future development of condominiums. He seems more concerned with low-cost housing," Estis said. "The more incentives you have and more favorable tax treatment, the better development you will end up having."
Ross Moskowitz, a real estate partner at Stroock Stroock & Lavan, said real estate developers in the last 18 months have been pushing to finish projects and close deals before the next administration takes office. "There's an unknown" about what to expect after 12 years of Mayor Michael Bloomberg, and "therefore there's a natural inclination to worry," he said.
Moskowitz said he also questions whether reducing the value of tax incentives may deter new construction.
"If there are hurdles put out or an environment created that would disincentivize the real estate community from doing new construction, that could have a huge impact on the budget of the city," he said.
Still, de Blasio's campaign has reportedly received hundreds of thousands of dollars from real estate interests, and he has supported controversial construction projects, such as Atlantic Yards, anchored by the Barclays Center, and a proposal for development along the polluted Gowanus Canal.