Adams, Construction Unions and Cirrus Launch $400M Affordable Housing Fund
By Abigail Nehring March 8, 2024 4:25 pm
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New York City labor leaders, investment firm Cirrus Real Estate Partners and Mayor Eric Adams launched a $400 million affordable housing fund Friday, and invited state lawmakers to take notice.
The agreement seeks to build new affordable and workforce housing in yet-to-be-determined locations around the city using unionized labor, according to the announcement. To kick off the fund, the Building and Construction Trades Council of Greater New York (BCTC) pledged an initial $100 million, pooling the pension funds from 11 unions, while Cirrus expects to raise hundreds of millions more from investors.
Anthony Tufariello, managing partner at Cirrus, said the firm joined the fund after being troubled by the lack of affordable housing for working-class New Yorkers.
“We wanted to try to be a part of the solution for that,” Tufariello said. “We felt the best way to do that is to create this collaboration between government, labor and private capital.
“It’s somewhat historic in that it’s a public-private partnership to solve a social need. In our minds, this is the model that we need to use to solve the housing crisis,” Tufariello added.
The unlikely alliance between the mayor, Cirrus and Gary LaBarbera, president of BCTC, has been in the works for about a year and brings together a powerful umbrella organization representing 100,000 building trades workers with an industry player whose portfolio spans some $150 billion worth of commercial real estate loans.
In a statement, Adams described the deal as the first of its kind, adding that it would help make New York City a leader in tackling the national housing crisis.
“As the blue-collar mayor of America’s biggest union town, I have been clear that our mission is to create good-paying jobs and make our city more livable for hardworking New Yorkers,” Adams said.
Housing vacancy in New York City is 1.4 percent, lower than it’s been any time since 1968, according to initial findings from the housing and vacancy survey released last month. And a study last fall by the Community Service Society found that a majority of households are rent-burdened, with a third spending more than half their income on rent.
The new fund aims to ameliorate some of the city’s housing woes and “provide much-needed workforce housing for those who make the city work,” Joe McDonnell, a managing partner at Cirrus, said in a statement.
The mayor’s announcement did not include the number of new units the partners hope to create or a timeline for development to start, but it said the new housing will be affordable to households earning between 80 and 140 percent the city’s area median income.
The housing will also be located near transit, will follow guidelines for environmentally sustainable building goals, and will seek to be built on city-owned properties, according to the mayor’s announcement and Tufariello.
“This partnership will lead to the development of affordable workforce housing under negotiated project labor agreements that will create family-sustaining union careers for New Yorkers,” LaBarbera said in a statement. “We believe that the union funds investing in this program have demonstrated tremendous vision, and we look forward to building the housing supply for the city’s working class.”
Praise also flowed from trade organization the New York Building Congress whose president and CEO, Carlo Scissura, described the partnership as “historic” in a statement.
“I urge fellow leaders across the city and state to view this innovative partnership as a model for how we can work together across all industries to create good-paying jobs in the construction industry and affordable housing for construction workers and their families,” Scissura said.
Abigail Nehring can be reached at anehring@commercialobserver.com.
