Sure, the west side of Flatbush has a huge selection of new luxury apartments. But what about the east side?
The Jay Group has that covered! They filed plans for five new buildings alongside Flatbush Ave in 2024, with construction already underway for two and two more just securing a new $105M loan, according to The Real Deal.
These five units are the first in the neighborhood to take advantage of the new 485-x tax incentive, which started in June 2022 and replaced the previous 421-a program.
There are a few key differences with the new 485-x program, including:
- Duration: 485-x offers up to 40 years of tax benefits (35 years plus 5-year phase-out) compared to 421-a’s maximum of 35 years.
- Rent Stabilization: 485-x locks affordable units into permanent rent-stabilization, compared to a 35-40 year lock-in under 421-a. However, market rate units are no longer stabilized
- Wage Requirements: 485-x imposes a $40 per hour floor in terms of worker pay for projects with 100 units or more
The changes are subtle and the reaction from builders lukewarm—Real Estate Board of NY (REBNY) called it less productive due to the higher wage requirements and permanent rent stabilization. But for residents who can snag an affordable unit, they’re set for life (unless they need another bedroom or want to leave the city).
The Jay Group’s new loan, as part of it’s planned five-building luxury project in Downtown Brooklyn, kicks off the new wave of development in the neighborhood after a sharp fall in permit filings after 421-a lapsed.
I always sort of felt like developers were trying to turn Downtown Brooklyn into Brooklyn’s Tribeca. Each year, it’s starting to feel more and more like that’s coming true.
