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March 7 2013

A Real Estate Solyndra in Gotham?

Charlotte Hays

Just after I praised Mayor Michael Bloomberg, I read this and this.

Hizzoner just can’t stop meddling. Now Bloomberg is backing what may well turn out to be the Solyndra of real estate: the design and development of so-called micro-apartments. There is a pretty good chance that the project will be about as successful as the failed solar panel company we taxpayers invested in courtesy of the Obama energy department.

Such apartments measure between 250 and 370 square feet. The Wall Street Journal has pointed out that this is four times the size of a cell on Rikers Island. Bloomberg is behind a contest to design and build such dwellings. The winner will build a building with 55 of these wee apartments, all featuring a Murphy bed. The Weekly Standard reports:

About half the units will be income-restricted—though at a minimum of $914 a month for 250 square feet, not exactly cheap—and the other half will rent at market rates. Bloomberg hopes that this “pilot project” will prove a success and that micro-apartments will soon pop up all over Gotham.

I guess I could accuse Bloomberg of wanting to get in our bedrooms--except that a pull-down Murphy bed isn't exactly a bedroom.

Media outlets have taken at face value the claim that no taxpayer money will be used in this experiment. But, as the Standard goes on to note, this isn’t entirely true:

But New York City taxpayers are indeed—albeit slightly indirectly—subsidizing the project. Here’s how: The new building will be constructed on a city-owned parcel of land in Kips Bay. The city sold the Manhattan property to the winning development company for $500,000. That’s a laughably measly sum. Through the first eight months of 2012, the average land price in Manhattan was $323.43 per square foot, according to data from a Brooklyn-based real estate agency.

The city sold the parcel at a rate of only a little more than $100 per square foot. An independent agency values the land at $1.2 million, more than twice the price at which the city unloaded it. And that’s not the only way private developers are profiting from Bloomberg’s public policy. Since 1987, under an anti-slumlord statute, New York City has required that new apartments be a minimum of 400 square feet; his administration is also unilaterally waiving zoning regulations for this particular project.

These apartments may be a good idea. On the other hand, they may be an abysmal idea. I lived in a studio apartment for years. It was a beautiful one, with bow windows overlooking Columbia Road with a view of the Washington National Cathedral. I have fond memories of that apartment. At a certain point, however, I became obsessed with my need for a bedroom!

There may be many people who don’t come home enough to care that they can't turn around in their apartments, or others who are willing to spend an undue amount of time sitting on park benches in order to make such dwellings tolerable. We just don’t know. Mini-apartment could be the wave of the future. But here is one thing we do know: it would be better to let the free market decide if such apartments are feasible. Has anybody asked Mayor Bloomberg who will live in what most of us would consider miserably-cramped spaces?

Interesting tidbit from the Standard: Mayor Bloomberg, who has 11 residences, makes his home in a 12,500 square-foot townhouse on East 79th. He is the first New York mayor not to live in Gracie Mansion since it became the mayor’s official residence in 1942.

Mayor Bloomberg is counting on us peons wanting to live in rabbit warrens.  But these apartments would solve one problem: Move into one of these cells, and you won't have a fridge big enough to accomodate a super-sized bottle of soda pop!

Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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