Hilton Near JFK Airport to Convert to Affordable Housing

In the middle of the pandemic, a state program was announced in New York to convert hotels into affordable housing. This week, developers announced plans for the first project: the conversion of a Hilton hotel near JFK Airport.

Developers Slate Property Group and RiseBoro Community Partnership said they plan to convert the hotel in Queens into more than 300 units of housing, the New York Times reported. The owner of the Hilton, Sam Chang, is selling the property to the joint venture of Slate and Riseboro for an unspecified amount.

About 60% of the units in the converted hotel will be earmarked for the homeless, which exceeds the threshold required to receive state funding for the project. The balance of the units will be reserved for low-income households, with rents set at $1,200 for one-bedroom units and $1,500 for two-bedroom units.

The state is providing $48M of the $150M project through a state program called Housing Our Neighbors with Dignity. NYC’s Housing Development Corp. and Department of Housing Preservation and Development also are providing subsidies.

When the state program was announced in 2021, NY said it would capitalize on the slump in tourism by making hotel conversions “easier and cheaper.”

In the year that followed, developers complained that the program didn’t cut enough red tape on affordable housing developments and the $200M funding it offered was not enough for large-scale developments.

Now, the program is rolling out its first project in the midst of a brisk tourism recovery, at a time when the environment for new construction is difficult.

The state and the developers are hoping the Hilton conversion will showcase how adaptive reuse projects can be completed faster and at a much lower cost than building new multifamily campuses.

“We have to make the pie bigger. We have to add more units than we’ve ever done,” David Schwartz, a principal at Slate, told the NY Times.

The developers estimate the converted hotel rooms, as well as renovations to heating systems and other parts of the Hilton, will be ready to be occupied within two years.

Jessica Katz, NYC’s chief housing officer, told the newspaper hotel conversions have been slow to take off because of the rebound in tourism and because hotels have been used to shelter thousands of migrants that continue to arrive in NYC in large numbers.

Katz also said that “lessons learned” from the hotel conversion program would help the state create a better office-to-residential conversion program.