N.Y.U. Strikes Deal Preserving Affordable Housing at 505 LaGuardia

mitchellMelvin Felix 505 LaGuardia

New York University has reached an agreement with the co-op board at 505 LaGuardia that will prevent dramatic rent hikes at the building. The new agreement extends the current lease in perpetuity, as long as the building remains part of the Mitchell-Lama affordable housing program.

The building’s previous lease was due to expire in 2014 after standing for 50 years. Terms of the new lease became a sticking point in the negotiations surrounding the university’s expansion, even though the building itself would not be affected. Politicians including Borough President Scott Stringer, Congressman Jerrold Nadler, and State Senator Thomas Duane had repeatedly called for the university to come to an agreement with 505 LaGuardia that would avoid rent hikes at the 30-story towers designed by James Freed and I.M. Pei.

Today, N.Y.U. described the agreement, the specific terms of which were not released, as a reflection of the university’s commitment to affordable housing.

“This is a huge victory for Greenwich Village,” Councilwoman Margaret Chin, who represents the neighborhood, said in a statement. “It guarantees, for all of our lifetimes, that working families and the middle class will have a place to call home in this community.”

Ray Cline, who negotiated on behalf of the co-op as its former chair and current vice president, cautioned that while an agreement had been made, a lease had not yet been signed. The co-op spent $100,000 to hire the firm of Gibson Dunn to negotiate the lease, and lawyers were now reviewing its terms, he said. The same firm is expected to challenge the land-use review process for N.Y.U. 2031.

“We now have a lease that’s like taking a bite out a lemon. We have to do it, but it’s like taking medicine,” Mr. Cline said. Most tenants would have preferred N.Y.U. to transfer the lease over to them entirely, but N.Y.U. made it clear that wasn’t an option, he added.

Mr. Cline estimated that half of the building’s tenants weren’t satisfied with the new terms, but he was pleased not to be facing the possibility of drawn-out litigation and large rent increases for elderly tenants.

“We are here as long as we can make this as a business run,” Mr. Cline said. “Now, I think we have a really good shot at it.”