Tag Archives: land use

Mayor Mamdani @ The Brooklyn Navy Yard

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I was quoted in At Brooklyn Navy Yard, Mamdani’s Jobs Agenda Collides with His Anti-ICE Politics. It reads, in part, 

… BNYDC’s leases generally do not give the corporation authority to govern a tenant’s customers or what those customers do with products they purchase.

Asked specifically whether Crye had come up in her conversations with Mamdani, Greene said it had not.

A City Hall source similarly said the Mayor’s Office does not get involved in individual Navy Yard leases and that evictions may only take place when tenants violate contractual requirements such as financial obligations, legal compliance or permitted uses.

However, Council Member Shekar Krishnan, chair of the Council’s Oversight and Investigations Committee, said public ownership should change the equation.

“Public land like the Navy Yard should not be doing business with companies that dress ICE officers and support ripping families apart,” Krishnan said, adding that he was exploring “all tools at our disposal to keep public land away from ICE operations.”

Asked what those tools could include, his office said it was still exploring its options.

Cornell Law School clinical professor David Reiss, a real estate law expert, who reviewed two other Navy Yard leases and BNYDC’s bylaws but not Crye’s private agreement, told amNewYork that the legal options may look very different depending on whether Crye is still in the middle of a lease or seeking another term.

“Based on other Navy Yard leases I have reviewed — not Crye’s own, which I have not seen — Brooklyn Navy Yard Development Corporation leases can only be terminated for specific things like nonpayment, misuse of the space, or sanctions-list status, not because of who a tenant’s customers are or how they use a tenant’s products,” Reiss said.

“Lease renewal is a different question,” he added. “Landlords generally have much broader discretion about whether to keep renting to a tenant once a lease has fully run its course.”

Reiss said BNYDC would likely have broad discretion not to renew Crye, unless the company has an unexercised option giving it a contractual right to another term. A nonrenewal could still draw a lawsuit.

“Crye might argue the decision was arbitrary and capricious or exceeded BNYDC’s corporate authority under state law,” Reiss said. Federal constitutional claims involving retaliation, viewpoint discrimination or equal protection, he added, “could face significant doctrinal hurdles on these facts.”

That makes the terms of Crye’s lease, and who sits on BNYDC’s board when a renewal decision arrives, central to what happens next.

BNYDC’s bylaws allow the mayor to appoint up to 29 members, including as many as 25 discretionary appointees who serve at the mayor’s pleasure. The mayor may also remove members with or without cause.

Reiss said that structure gives Mamdani “real leverage” over such decisions even though BNYDC itself is the landlord.

Who Controls the Block? How States Can Regulate Tokenized Residential Real Estate

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I have posted Who Controls the Block? How States Can Regulate Tokenized Residential Real Estate to SSRN (with Bizub & Peralta). The abstract reads,

In July 2025, the City of Detroit filed a major nuisance abatement action against RealT, a fintech that had sold blockchain-based fractional interests in more than four hundred Detroit rental properties to some 22,000 investors around the world. Within a year, a court had ordered the company’s rents into escrow, the company had conceded to its investors that its “model no longer works,” and it had announced the liquidation of its portfolio  —  leaving tenants without basic services and token holders facing steep losses.

This article uses the rise and collapse of RealT, together with case studies of the other leading real estate tokenization business models, to evaluate the claims made for tokenized real estate as a new asset class for individual investors. Measured against the publicly-traded REIT, tokenization offers only one advantage to investors —  a bespoke level of diversification  —  and it does so while shedding the investor protections that registration and exchange listing provide. More fundamentally, the leading business models rest on skirting the state and local legal infrastructure of real property: recording regimes, transfer and property taxation, and homeowner and tenant protections. Like the mortgage industry’s Mortgage Electronic Registration Systems, Inc. (“MERS”) a generation ago, tokenization externalizes the costs of that end-run onto the parties least able to bear them.

Real estate tokenization is still in its infancy, and state and local governments have a window of opportunity to shape how these fintechs operate within their borders. Some have begun to use it: Maine’s first-in-the-nation statute regulating shared appreciation agreements supplies one template, and Detroit’s enforcement campaign another. This article maps the gaps that remain  —  most notably in transfer taxation and tenant protection  —  and offers an agenda for closing them before tokenization scales.

 

Housing Supply and The Housing Crisis

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By James Cridland from Brisbane, AU - Crowd, CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=74365875

Opportunity Now interviewed me about how limited housing construction impacts the housing crisis:

Dynamic metropolitan areas like the Bay Area, LA, and New York City suffer from longstanding mismatches between the supply of housing and demand for it. Local communities control the zoning, and local voters (typically existing homeowners) have little incentive to increase the supply of housing. After all, more supply will likely increase the tax burden as new residents increase the demand for services (more schools, more infrastructure, more public safety). Homeowners are already in the market and generally like the way things are, notwithstanding their political views about the high cost of living for others and the epidemic of desperate homelessness that plagues all of these areas. The result of all of these local land use decisions is that very few units of housing are built in these communities, given the size and growth of the population.

Many coastal cities are high-opportunity areas, offering jobs to immigrants, young adults, and strivers of all stripes. They drive up the demand for housing even hours from urban centers, living in overcrowded units in many cases.

When demand outpaces supply, prices rise. Government can try to limit the effect of this pressure through a variety of means: rent controls, housing subsidies, right-to-shelter legislation. All of these interventions can assist certain segments of the housing burdened — current renters, new renters, homeless people — but to a large extent, they just reallocate scarce housing from one burdened group to another. That is not necessarily bad public policy given the current political realities, but it does not address the fundamental problem these communities face: There is not enough housing for all of the people who live in them. A broad coalition of decision-makers needs to face this reality and develop long-term strategies to build a lot more housing where all of these people want to live — for access to economic opportunity, for proximity to family, for all of the reasons that people want to relocate and build a life for themselves and their loved ones.

Does Historic Preservation Limit Affordable Housing?

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By Stefan Kühn - Own work, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=9413214

I answer that it can in CQ Researcher’s Historic Preservation:  Can The Past Escape The Wrecking Ball?

Many people fail to realize that land use policies like historic preservation involve big trade-offs. The most important one is that if you want to protect existing structures from demolition and modification, you can’t replace them with bigger ones that could house more people. Consider:

  • Historic preservation equals height and density restrictions. New building technologies (think steel girders and elevators) allow buildings to be built higher as time goes by. If a city landmarks a large percentage of its inner core, it restricts the ability of that core to go higher. This can lead to sprawl, as a growing population is pushed farther and farther from the city center.
  • Historic preservation favors the wealthy. Limited supply drives up housing prices and apartment rents, benefiting owners. And low-income and younger households are likely to suffer, as they are least able to bear the cost of the increases compared to other households. Future residents — think Midwesterners, Southerners and immigrants seeking to relocate to a city like New York for job opportunities — will also suffer.
  • It isn’t easy for historic preservation to be green. It feels environmentally responsible to protect older, low-density buildings in city centers because you have no dusty demolition, no noisy construction. But it actually comes at a big environmental cost. Denser construction reduces reliance on cars and thereby lowers carbon emissions. People living in a dense city have a much smaller carbon footprint than those in a car-oriented suburb.

Just because preservation comes at a cost does not mean it is bad. Much of our past is worth protecting. Some places benefit from maintaining their identities — think of the European cities that draw the most tourists year in and year out. But it is bad to deploy historic preservation indiscriminately, without evaluating the costs it imposes on current residents and potential future ones.

Cities that want to encourage entrepreneurship and affordable housing should deploy historic preservation and other restrictive land use tools thoughtfully. Otherwise, those cities will be inhabited by comparatively rich folks who complain about the sterility of their current lives and who are nostalgic for “the good old days” when cities were diverse and hotbeds of creativity.

If they fail to understand the trade-offs inherent in historic preservation, they won’t even understand that a part of the problem is the very policy they support to “protect” their vision of their community.

Promoting Equitable Transit-Oriented Development

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graphic by USGAO

Enteprise has released a report, Promoting Opportunity through Equitable Transit-Oriented Development (eTOD): Navigating Federal Transportation Policy. It opens,

Transportation, housing and land use decisions that form the foundation of our development patterns are made at every level of government. While the local regulatory environment significantly impacts the amount and type of development that occurs, the federal government plays a major role in local development in both overt and hidden ways. Federal funding is the most obvious source of influence. However, this funding comes with a catch, as the incentives and regulations that govern funding programs can have a significant impact – both positive and negative – on the type of housing and transportation infrastructure that is built and how it is maintained over time.

The federal ability to influence development patterns gives it both direct and indirect influence on a community’s strength and composition. Individual families, the local economy, municipal governments and the environment all benefit when well-located housing, jobs and other necessary resources are connected by efficient transportation and infrastructure networks. Equitable transit-oriented development (eTOD, see sidebar for definition) is an important approach to facilitating these connections. eTOD supports the achievement of multiple cross-sector goals, including regional economic growth, enhanced mobility and access, efficient municipal and transportation network operations, improved public health and decreased cost of living. For a full discussion of the benefits of eTOD, read Promoting Opportunity through eTOD: Making the Case.

In recent years, the federal government has taken several actions that are more conducive to fostering eTOD. Notable examples include the adoption of incentives for creating and preserving affordable housing near transit, the provision of planning and technical assistance resources to support eTOD, and the reduction of barriers to producing affordable housing on federally-funded property. However, a wide range of policies and incentives that do not explicitly address eTOD can also support or detract from the conditions that make such development possible.

Navigating Federal Transportation Policy is the third report in our Promoting Opportunity through eTOD research series. This report seeks to assist stakeholders involved in achieving eTOD, such as public entities, developers and practitioners, as they work to navigate the federal policy landscape, with a focus onFederal Transit Administration (FTA) policies and programs. These policies and programs generally offer several funding and technical assistance opportunities that can address eTOD (among a range of other uses), but housing practitioners may be less familiar with these resources and how to access them. (2, footnote omitted)

While the report explicitly acknowledges the changed environment since President Trump’s election, it does not seem to fully integrate those changes into its recommendations. While there are a lot of good ideas in the report, I am afraid that it will take a few years, or longer, for them to find a sympathetic ear in the Executive Branch.

The Missing Piece in The Affordable Housing Puzzle

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The National Low Income Housing Coalition has posted The Gap: A Shortage of Affordable Homes. The report opens,

One of the biggest barriers to economic stability for families in the United States struggling to make ends meet is the severe shortage of affordable rental homes. The housing crisis is most severe for extremely low income renters, whose household incomes are at or below the poverty level or 30% of their area median income (see Box 1). Facing a shortage of more than 7.2 million affordable and available rental homes, extremely low income households account for nearly 73% of the nation’s severely cost-burdened renters, who spend more than half of their income on housing.

Even with these housing challenges, three out of four low income households in need of housing assistance are denied federal help with their housing due to chronic underfunding. Over half a million people were homeless on a single night in 2017 and many more millions of families without assistance face difficult choices between spending their limited incomes on rent or taking care of other necessities like food and medical care. Despite the serious lack of affordable housing, President Trump proposes further reducing federal housing assistance for the lowest income households through budget cuts, increased rents and work requirements.

Based on the American Community Survey (ACS), this report presents data on the affordable housing supply, housing cost burdens, and the demographics of severely impacted renters. The data clearly illustrate a chronic and severe shortage of affordable homes for the lowest income renters who would be harmed even more by budget cuts  and other restrictions in federal housing programs. (2, citations omitted)

The report’s key findings include,

  • The nation’s 11.2 million extremely low income renter households account for 25.7% of all renter households and 9.5% of all households in the United States.
  • The U.S. has a shortage of more than 7.2 million rental homes affordable and available to extremely low income renter households. Only 35 affordable and available rental homes exist for every 100 extremely low income renter households.
  • Seventy-one percent of extremely low income renter households are severely cost-burdened, spending more than half of their incomes on rent and utilities. They account for 72.7% of all severely cost-burdened renter households in the United States.
  • Thirty-two percent of very low income, 8% of low income, and 2.3% of middle income renter households are severely cost-burdened.
  • Of the eight million severely cost-burdened extremely low income renter households, 84% are seniors, persons with disabilities, or are in the labor force. Many others are enrolled in school or are single adults caring for a young child or a person with a disability. (2, citations omitted)

While the report does show how wrongheaded the Trump Administration’s proposed cuts to housing subsidies are, I was surprised that it did not address at all the impact of local zoning policies on housing affordability. There is no way that we are going to address the chronic shortage in affordable housing by subsidies alone.

The federal government will need to disincentivize local governments from implementing land use policies that keep affordable housing from being built in communities that have too little housing. These rules make single family homes too expensive by requiring large lots and make it too difficult to build multifamily housing. We cannot seriously tackle the affordability problem without addressing restrictive local land use policies.

Zoning and Housing Affordability

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Vanessa Brown Calder has posted Zoning, Land-Use Planning, and Housing Affordability to SSRN. It opens,

Local zoning and land-use regulations have increased substantially over the decades. These constraints on land development within cities and suburbs aim to achieve various safety, environmental, and aesthetic goals. But the regulations have also tended to reduce the supply of housing, including multifamily and low-income housing. With reduced supply, many U.S. cities suffer from housing affordability problems.

This study uses regression analysis to examine the link between housing prices and zoning and land-use controls. State and local governments across the country impose substantially different amounts of regulation on land development. The study uses a data set of court decisions on land use and zoning that captures the growth in regulation over time and the large variability between the states.

The statistical results show that rising land-use regulation is associated with rising real average home prices in 44 states and that rising zoning regulation is associated with rising real average home prices in 36 states. In general, the states that have increased the amount of rules and restrictions on land use the most have higher housing prices.

The federal government spent almost $200 billion to subsidize renting and buying homes in 2015. These subsidies treat a symptom of the underlying problem. But the results of this study indicate that state and local governments can tackle housing affordability problems directly by overhauling their development rules. For example, housing is much more expensive in the Northeast than in the Southeast, and that difference is partly explained by more regulation in the former region.

Interestingly, the data show that relatively more federal housing aid flows to states with more restrictive zoning and land-use rules, perhaps because those states have higher housing costs. Federal aid thus creates a disincentive for the states to solve their own housing affordability problems by reducing regulation. (1)

This paper provides additional evidence for an argument that Edward Glaeser and others have been making for some time now.

Local governments won’t make these changes on their own. Nonetheless, local land-use decisions have a large negative impact on many households and businesses who are not currently located within the borders of the local jurisdictions (as well as some who are). As a result, the federal government could and should take restrictive land use regulation into account when it allocates federal aid for affordable housing.

The Obama Administration found that restrictive local land-use regulations stifled GDP growth in the aggregate. Perhaps reforming land-use regulation is something that could garner bipartisan support as it is a market-driven approach to the housing crisis, a cause dear to the hearts of many Democrats (and not a few Republicans).