Mamdani’s Free Child Care Plan Raises More Questions Than Answers

In 2022, New York City lost an estimated $23 billion in economic activity due to parents leaving the workforce, paring down work schedules or modifying career ambitions due to an inability to meet their child care needs.

This statistic, from a February 2024 report from New York City think tank 5Boro Institute, illustrates the importance of accessible and affordable child care to the city’s business community, including a commercial real estate industry that relies on demand for workspace for a good chunk of its return on investment.

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Therefore, the recent announcement by Mayor Zohran Mamdani and Gov. Kathy Hochul that the city and the state will work together to implement what they’re calling 2-Care — free child care for the city’s 2-year-olds — and strengthen the previously implemented 3K program, which offers the same for 3-year-olds, holds potential to alleviate the pressures that hold some parents back from full participation in the workforce.

But based on the experience of implementing the citywide Pre-K For All program — which offered free child care for 4-year-olds — under Mayor Bill de Blasio, the implementation of 2-Care brings with it concerns that the city, even under the duly determined Mayor Mamdani, can deliver on its promises in this area.

According to a December 2024 feature in New York magazine, the de Blasio-led implementation of Pre-K For All was a herculean effort that took seemingly every ounce of attention, effort and ingenuity the administration possessed over a 24-month period. Challenges included melding child care sites into already established preschool programs, commandeering available spaces in school buildings and churches, and building brand-new pre-K centers everywhere from parking lots to a former Dunkin’ Donuts.

The two-year buildup was an unqualified success, but that sort of dedicated effort took its toll. When the de Blasio administration tried to duplicate the effort for 3K, the administration found that it was “almost maxed out on space,” and that “the manic energy of the first two years was gone,” according to New York.

Between that, the pandemic and the relative disinterest of de Blasio’s successor, Eric Adams, de Blasio’s idea for a universal 3K program was half implemented at best, and was definitely not universal.

In a sense, the city’s pre-K and 3K efforts under de Blasio proved that government can accomplish great things when it puts its collective mind to the tasks, but also that the amount of great things it can accomplish is severely limited by the resources and unflagging energy required to get such things done. 

Now, Mamdani and Hochul, having to seemingly start from scratch, hope to complete the child care job and expand on it, freeing up that $23 billion in economic impact and then some.

In Gov. Hochul’s 164-page “State of the State 2026,” a tome released in conjunction with her Jan. 13 speech of that name, the state’s participation in 2-Care and 3K are the first policy elements addressed.

The economic impact is clearly top of mind.

“Studies show that implementing universal affordable child care in New York could increase labor force participation by as many as 28,000 additional workers, leading to as much as $1.6 billion in additional wages across the state,” said the book.

The governor notes that the state will increase its investment in child care statewide by $1.7 billion, bringing it to a total of $4.5 billion by 2027, including the full funding of the first two years of 2-Care in New York City.

The initial pilot program for 2-Care intends to serve 2,000 children throughout the city’s highest-need areas, known as “child care deserts,” by this fall, with over 30,000 children served by full implementation in year four.

Yet, while the big picture goals are clear, the specifics on how we’ll get there are still to be determined.

“Everybody in the industry, including day care businesses themselves, are scratching their heads to understand how these new policies are going to be enforced and enrolled, because we’re still currently dealing with a 3K shortage,” said Michelle Abramov, vice president at retail real estate brokerage Ripco. “It’s not as if we have dealt with that issue. So, regarding vouchers for a 2-Care system, no one’s clear on how this is going to be implemented.”

Perhaps the biggest open question about the new programs is where exactly these child care sites for 2-year-olds and 3-year-olds will be established.

“It is so hard to place a child care unit in a building in New York City, because there are tons of regulations,” said Mary Ann Tighe, CEO of CBRE’s New York tri-state region. “There are all kinds of building code requirements. The notion that you can just throw money at [the child care problem] is really naive. There are any number of zoning and building code regulations that will have to be adjusted in order to make it legal to operate.”

Tighe noted that during recent periods of high retail vacancies, there had been talk about using retail spaces for child care. In the long run, she said, this proved to be more talk than action.

“One of the proposed uses for retail space was for child care. And nothing happened,” said Tighe. “So I’m thinking, well, [the new child care announcement] is lovely. Show me how it happens. Because there’s no question it would bring parents to work.”

Given the available data, it’s difficult to estimate exactly how many retail spaces have been used for child care during and since the de Blasio years, much less how many of those may have already existed as child care establishments and how many were converted from other retail uses. 

“I don’t think it was that much relative to the overall retail space,” said Rob Bonicoro, senior vice president of the retail advisory and transaction services group at CBRE. “I don’t even think they opened that many spaces, and, if they did, it wasn’t in any of the prime retail corridors that really affected the market.”

The 5Boro report includes a section titled “Create more physical space for child care,” which spells out many of the challenges and possible solutions to locating or carving out space for child care establishments in the city.

“According to the city’s health code, child care programs can only inhabit certain parts of buildings; code requires child care sites serving children under 24 months to be located on the ground floor, which is often the most expensive part of a larger building,” reads the report, which also cites “strict regulations about the number and size of bathrooms in child care centers, and centers required to allot at least 30 square feet of wall-to-wall classroom space per child.”

The report went on to suggest regulatory reforms, including allowing child care spaces to expand beyond the ground floor, maximizing the use of existing tax abatements, and creating other incentives such as expanding the buildable area for developers to create spaces in new projects for child care usage.

Grace Rauh is a former political reporter for NY1 and founder of the 5Boro Institute, which joined the good government organization Citizens Union in May 2025, with Rauh the union’s executive director.

“We only have one licensed child care seat for every two kids under the age of 5 in New York,” Rauh told Commercial Observer. “I understand that [the ground-floor] regulation was implemented for safety reasons, but given the scale of the challenge families are having, we feel like this would be a very commonsense reform for the city to make. There is a strategy to address this by coordinating the agencies that need to sign off on the health and safety of a child care center.”

It could be seen as positive news, then, that Rauh’s co-author on the February 2024 report was Emmy Liss, a policy adviser for 5Boro who was a key member of the de Blasio administration team that rolled out Pre-K For All, and who in December was named director of the city’s child care office by Mamdani. 

CO reached out to Liss, but she was unable to arrange a time to speak before this article’s deadline.

“Just because she co-authored this report doesn’t mean that this is the playbook she’s following verbatim at City Hall,” said Rauh. “But these are all ideas that are certainly on her radar as she thinks about how we get more physical space for child care centers in the city, because that’s a piece of this puzzle.”

The importance of locating as many spaces as possible as soon as possible is especially apparent to those who recall the early days of de Blasio’s pre-K effort.

Bernadette Brennan is executive director at the brokerage SERHANT, where she currently runs the company’s commercial division. Brennan recalled for CO how the city’s pre-K program kicked off right around the time her children were the perfect age to participate. But, even after the program was approved, finding slots for her children became as challenging as successfully marketing a toxic superfund site.

“There was no available child care because none of the spaces had been open or set up,” recalled Brennan. “I wound up trying to become [one possible site’s] broker just to be able to find spaces for them that were compliant, and it was almost impossible. I was tracking down old day cares. There are a lot of regulations with these with stairs, fire safety and water pipelines. There are even proximity issues around what they can be close to. And for 2-year-olds and younger, you can’t be below ground, but, if it’s set up on the ground floor then you need to be a community facility, so you need to change your [certificate of occupancy], which involves so much red tape.”

Shlomi Bagdadi, founder and CEO of Tri State Commercial Realty, has been brokering child care spaces for almost two decades. He said the regulations now might be even more onerous than they were during the early days of Pre-K For All.

“The amount of time it used to take to get the proper licensing before pre-K was maybe about two to three months,” said Bagdadi. “Nowadays, it takes anywhere between six to 18 months. It’s insane.”

Bagdadi notes that child care operators, even for smaller facilities in the 2,000- to 3,000-square-foot range, must deal directly with multiple agencies to secure all the permits they need to develop and operate their facilities.

“You have to go to the Department of Housing Preservation and Development, and you have to go to the Fire Department for fire safety,” said Bagdadi. “And, above all that, you have physical restraints, like you have to have a backyard for the kids, and you have to be on the ground floor.”

The ground-floor restriction was mentioned unprompted by virtually everyone CO spoke to for this article, highlighting its prominence as an obstacle to creating new child care facilities. 

Brennan spelled out exactly what just that one restriction could mean for the retail sector.

“If you’re under 2 years old, you’re not allowed to be under a certain floor,” said Brennan. “That’s going to automatically eliminate a good portion of retail because if the kids can’t go to the basement, and the retail is half-retail, half-basement, then you’ve just leveled up half of the property to something you can’t use. They will need to have some variances in place, or they’re going to have to change their rules and regulations.”

New Yorkers United for Child Care is a group whose purpose is to build the political clout necessary to get free universal child care implemented throughout New York City. 

The group released a paper in October 2025 called “2-Care For All: A Blueprint for Implementing Universal Child Care for New York City’s 2-Year-Olds.” According to Executive Director Rebecca Bailin, Emmy Liss is one of the group’s co-founders and the author of this paper.

The paper notes that the effort for citywide, free and full-day child care is expected to cost $1.3 billion and serve 55,000 2-year-olds annually. It also said that “full-time child care for a 2-year-old in New York City costs roughly $23,400 annually — more than the cost of full-time tuition at CUNY.” According to the paper, a household would need to earn $334,000 per year in order to reasonably afford this care.

The paper adds that “families with children under the age of 6 are twice as likely to leave New York.”

Regarding implementation, the paper notes that the majority of children served in pre-K and 3K are served in “community settings” versus “Department of Education public school settings.” While the report recommends expanding the capacity of current pre-K and 3K providers as well as focusing on “family child care programs in home-based settings” where possible, it also mentions the need for new capacity.

“New providers should be encouraged to participate in the program through targeted support such as tax incentives for construction of new or retrofitted programs, and streamlined licensing processes for providers who want to start new program sites or adjust licenses for existing sites to serve younger children,” the paper reads.

As it happens, at least one aspect of that is already in place.

According to an article that Ben Williams, who leads the property tax department at the law firm Rosenberg & Estis, wrote for the firm’s website, New York State “enacted legislation that revives, extends, and significantly expands New York City’s Childcare Center Property Abatement Tax” in December 2025, including an increased maximum benefit and more time to apply.

For projects taking their first abatement after July 1, 2025, the legislation lays out a $350,000 abatement cap, an enhanced abatement for centers in child care deserts of $750,000, and application deadlines extended to March 15, 2027.

According to Williams, the city has $25 million dedicated to this abatement for property owners leasing space to child care facilities. But the city has had trouble finding recipients due to not enough people knowing about the program.

Williams said that by using New York census info on child care deserts, the city could match that data with vacancy reports, noting the size of the vacant spaces to match the need, then inform the owners of those properties about the abatement.

“They’re looking for, say, 5,000-square-foot facilities as opposed to 200 square feet, because that’s not going to hold a child care facility,” Williams told CO. “They could use people’s storefront registration forms — which owners are required to file to report vacant first- and second-floor storefronts — and the Department of Small Business Services has their own tools that they use to identify retail or commercial vacancies in the city. So, if they match those up, they could identify and spot target facilities, send owners of those buildings notices directly alerting them about this program, and steer landlords toward renting their spaces out to child care facilities. And they should get the word out to brokers as well.”

This could open the door to new sites citywide. 

In another piece of good news about site selection, zoning laws give a wide berth to potential new child care sites.

“From a zoning perspective, these sites could be treated as nursery school-type programs,” said Howard S. Weiss, senior partner and land use chair at the law firm Davidoff Hutcher & Citron. “Under the definition of ‘school,’ a program would need to obtain the appropriate licensure under the New York City health code for child care programs. From a zoning perspective, though, there’s a fairly broad range of districts in which the program could be located, ranging from residential zoning districts to commercial zoning districts with just very limited exclusions. Like pre-K, it’s a favorite use even, with some limitations, in many manufacturing districts.”

Weiss also noted, however, that code and licensing requirements will be the greater obstacle.

“The immediate challenge confronting the city will be how quickly a sufficient number of existing buildings can be found with available space that already meet the applicable code and licensing requirements, and would comply with the buildings’ currently permitted uses under their certificates of occupancy to accommodate the pre-K and 2-Care programs,” Weiss said in a follow-up email to CO. “These requirements touch on space and supervision considerations, including specialized safety features and lower staff-to-child ratios for younger age groups, as well as a plethora of other requirements.”

Weiss noted that the Mamdani administration’s stated rollout procedure seems to have taken this into account, saying that the phased rollout to high-need areas for this coming fall allows spaces elsewhere time to get the upgrades, licenses and overall permissions they need. Some of this, Weiss said, could take six months or longer, although the Department of Buildings would have leeway to create an expedited process.

Even with all the obstacles, those in the know are finding reasons for optimism about the Mamdani administration’s ability to execute 2-Care.

“Having a mayor, governor and City Council speaker who are aligned on universal child care as a top public policy priority for New York is incredibly powerful, and means there will be political support and the will to get this done, which is hugely important,” said Rauh. (New Council Speaker Julie Menin is on record supporting the move.) 

New Yorkers United for Child Care’s Bailin, who said that the Adams administration cut outreach to parents informing them about the pre-K and 3K programs, notes that outreach from the Mamdani administration to all potential parties in 2-Care — from parents to potential facilities — will be crucial to the program’s success. 

“It’s really critical for the administration to put more money and effort into that,” said Bailin. “We need to make sure that everybody knows [about the program], and that all the information is available and easily accessible so people can take advantage of whatever cost-saving measures they need to make this work.”

Bailin reiterates that the success of 2-Care and the 3K expansion will be not just an economic and convenience win for the city’s parents, but also a significant boost for New York City’s economic engine overall.

“This is not only the right thing to do, but it’s critical for our economy,” said Bailin. “We need people to live in these buildings. We need working- and middle-class people. It drives our economy and it drives our workforce. So let’s make sure it happens carefully, but also quickly.”

Larry Getlen can be reached at lgetlen@commercialobserver.com.