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After a luxury building in East New York flopped, the city is taking advantage of a new program to fill it with families who have hard-to-use city housing vouchers. Tara Gilbert spent months looking for an apartment with her city-funded housing voucher while living in a Staten Island women’s shelter since January. She had leads on several apartments throughout the year, only to have them disappear and get rented to someone else. “It was very frustrating. I was starting to get angry to the point where I was like, damn, am I going to be in shelter for the rest of my life. What is this?” asked Gilbert. But her fortunes changed this October, when she moved into a new luxury building on Atlantic Avenue in East New York. All 183 units in her building will house voucher holders moving in from one of the city’s shelters. The project is the result of a “happy accident,” said Rebecca Crimmins, senior vice president for real estate and development at the Institute for Community Living (ICL), which now owns the building. In 2024, the Jay Group listed one-bedroom apartments in the building for $2,500 to $3,000 a month, and as much as $4,000 for three-bedroom units. But after the developers realized their luxury building didn’t have the demand they expected, they sold it to a nonprofit. The nonprofit and the city struck a deal to fill the building with voucher holders enrolled in the City Fighting Homelessness and Eviction Prevention Supplement (CityFHEPS) program, which provides rental aid to New Yorkers in shelter or at risk of homelessness. Expected revenue from the voucher payments will finance ICL’s mortgage on the building. City officials are confident the project is replicable. The effort is part of a new program called Affordable Housing Services from the Department of Social Services (DSS) that officials say will help ease the housing crisis by creating more options for voucher holders, whose housing choices are often slim. “For the first time ever, we are using social service dollars to actually underwrite affordable housing, and it is 100 percent dedicated to those coming out of the shelter system,” said DSS Commissioner Molly Park. In early October, Gilbert moved into a studio, which she decorated with crafts she made during her months in shelter. “Once I got home, I was happy. I was ecstatic,” Gilbert said. The feeling, she said, was “more peace than anything.” Stiff competition The CityFHEPS program has grown rapidly in recent years, and has become increasingly vital as the Trump administration pursues cuts to federal programs. Over 60,000 households, comprising 136,000 people, are currently leased up with a CityFHEPS voucher; they typically pay a third of their income on rent, with the subsidy covering the rest. From July 2024 to June 2025, 37,500 New Yorkers entered the program, more than any year on record, according to DSS. The budget for CityFHEPS grew five-fold from 2021 to 2025, to over $1.25 billion. “The federal government has essentially abdicated responsibility for growing availability to our rental assistance. The city has very much stepped up,” said Park. But a frequent criticism of CityFHEPS is that the vouchers are hard to use. Officials hope the Affordable Housing Services initiative will help the city actually build more of the units voucher holders need. The challenges are numerous. City housing vouchers don’t always pay enough to access the higher rent parts of the city, as City Limits has previously reported. And some landlords discriminate against voucher holders—even though doing so is illegal. “That whole process was terrible because a lot of them don’t want to rent to people with vouchers. They got the bad stereotype of what people are coming out of the shelter system,” said Gilbert. Commissioner Park also pointed to competition in New York’s hot housing market, particularly for apartments with rents low enough for voucher holders. “The hardest part about using a CityFHEPS voucher is the city has a 1.4 percent vacancy rate. There’s 13,000 households in the shelter system right now, who have what we call a shopping letter, and who haven’t found a place to use their voucher, which is a staggering number of people,” she said. Some households spend months searching for a place to use their voucher. While DSS does not track search times, Park said, a comptroller’s report found that it took 10 months on average (DSS has disputed the findings of that report). Affordable Housing Services, Park said, takes that competition out of the process by setting aside units specifically for voucher holders. Between this Atlantic Avenue project and the Baisley Pond Park hotel conversion, DSS said they are opening 374 units of deeply affordable housing in October using the program, bringing the total number of units funded with the initiative to over 1,000. Commissioner Park also expects Affordable Housing Services units to have faster lease ups than traditional CityFHEPS application packets, which take about 30 days, according to the agency—because their involvement with the projects helps them plan ahead. Victor Rivera, 58, who moved into a two-bedroom apartment in the building with his mother Rosa, 88, said it simplified and shortened their stay at a Far Rockaway shelter, where a social worker identified them as a good fit for the new development. Larger units paired with services After four months staying together in one cramped shelter room, Rivera and his mother got a spacious two-bedroom in the new building. “Oh, my moms was so happy. I was happy too, because first they said they was gonna give us a one bedroom,” he said. Rivera and his mother will benefit from support services on site, as well as a full gym, laundry, lounge, and a rooftop. “We’re really excited to be able to provide, you know, wraparound services to a variety of household sizes, including three bedroom units, which are really hard to find at this point in time,” said Crimmins. One report suggested that as much as 70 percent of subsidized affordable units built citywide under the Adams administration were one- and two-bedroom units. In all, the building has 43 studios, 54 one-bedrooms, 57 two-bedrooms, and 24 three-bedrooms. “There’s a place for a lot of different housing options, given that we just don’t have enough places for people to live who have modest means,” said Crimmins. The city’s housing vacancy rate is even lower for units priced at under $1,100, with just 0.4 percent open to renters. Commissioner Park pointed to different levels of need, including traditional affordable housing for people with lower incomes, and supportive housing for chronically homeless people with particular health needs, paired with robust services. This building helps fill the void, she said. “Historically, there hasn’t been anything in between, but we know there are people in between,” said Park. Opportunistic acquisitions Not every Affordable Housing Services project will be a luxury building turned into affordable housing, which grew from the Human Resources Administration’s Master Lease program, which set aside 10 percent of units for voucher holders. That program has received support from mayoral candidates like Zohran Mamdani, who says he would expand it if elected. Affordable Housing Services goes further, funding entire buildings meant for voucher holders. Park suggested that they were deploying the program tactically. As with The Atlantic, they may acquire newly constructed buildings where developers have pushed the market and may be incentivized to sell. Others might involve distressed buildings that can preserve affordability and have their lives extended through a project-based voucher contract like the one the Affordable Housing Services program offers. It has yet to be used to finance construction itself—to build for the explicit purpose for housing voucher holders. But officials wouldn’t rule it out as they try to grow the program. Crimmins said that would likely require the city’s housing agency to help finance the project. “I absolutely believe that it is scalable,” said Park. Earlier this year, the Rivera family was renting in Rego Park, paying $2,100 a month for a two-bedroom. When their landlord raised the rent $200, they went to a shelter to seek help, Rivera said. Rivera, who provides full time care for his mother, said they live on her social security and disability. “Before, everything was just going to rent,” Rivera said. Now he says they have a little money to get his mother’s hair done, and pay for a home health aide so he can get out of the house more. The family chef, he said he’s looking forward to cooking Thanksgiving dinner in his new apartment. To reach the reporter behind this story, contact [email protected]. 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