A Tale of Two Co-ops HDFCs in the Post-Gentrification Age

550 Fort Washington Ave - photo credit: Mitra Hakimi Realty Group, LLC

Housing Development Fund Corporation (HDFC) co-ops are an important and unique segment of the New York housing market that many fellow co-op shareholders are unaware of. Those who do know of the program are often familiar with it only from the negative press it receives; stories about tax arrears and failed corporations. That’s not a fair picture. There are many successful HDFC buildings, and the program has served to stabilize not only buildings but whole neighborhoods, while affording the dream of home ownership to many who otherwise would never have had a chance at it.

The HDFC program was founded in the 1970s amid a city in crisis. Buildings were burning, landlords were abandoning their properties, and long-time residents were fleeing for the surrounding suburbs. In simple terms, what the HDFC program did was to offer tenants in failing rental buildings the opportunity to invest with their dreams and sweat to turn their building communities around into solvent, stable, affordable permanent homes.

The terms of the HDFC program often included something called a regulatory agreement, which laid out specific rules about who could buy into the property relative to their income and the purchase price of the apartment. Paul Mishler, an associate professor of history specializing in labor studies at the University of Indiana, is a cooperator at 550 Ft. Washington Avenue, and has been for more than 20 years. “You had to be poor enough to need it,” he says of qualifying for residency, “but not so poor that you couldn’t pay the monthly maintenance.” These co-op corporations were created to keep middle- and working-class families in New York, stabilizing neighborhoods and slowing the suburban exodus. Regulatory agreements that focused on economic need and ability to pay were an effective tool in achieving that goal. The question today is, how effective has this approach been – and what is its future?

The Grinnell

The Grinnell, located at 800 Riverside Drive in the Audubon Terrace section of Washington Heights in upper Manhattan, is both a highly visible and successful example of the HDFC program. The property was built as a rental in 1911 and contains 80 units. It is an elevator building and features large apartments with elegant Beaux Arts finishes typical of properties built at the turn of the twentieth century. Today, it is one of the most successful HDFC buildings in New York City.

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2 Comments

  • Thanks for the article, but it needs some fixes: * Denny Farrell was a State Assembly Member, not a Congressman. Please correct. * Most early stage HDFCs (like the Grinell) were delivered WITHOUT the fixes made. The city offered low-interest loans to make the fixes, but shareholders had to pay for elevators, boilers and structural repairs. That has changed in the past 10- 15 years. * "The specter of gentrification raised its ugly head in Washington Heights." What exactly is gentrification, and why is it ugly? This seems a rather tendentious statement without defining the terms. Co-ops in particular are a poor example of "gentrification" being "ugly," as the people who cash out are the homesteaders who have reaped a return on their sweat equity (and $250 initial payment) and jumped into the middle class. The incoming buyers generally take on very substantial debt to own a home in NYC. * "Kibbutz?" "Left-leaning?" - C'mon. Why are you engaging in such ugly ethnic stereotyping? The HDFC movement is not a Jewish cabal. * Finally, you miss the whole point: The regulatory agreements have largely expired, but little is being done to ensure HDFCs remain affordable for the people who live in them.
  • Once again people who don’t know anything about HDFCs or its history and the legislative intent of the framers are advanced a thesis about something they know little about and something they have absolutely no control over. Rather than blow smoke up our a--es about the future of privately-held, independently-owned entities, some of these commentators should first do some research, speak to the right people other than those who will tell them what they want to hear and second clean up their own house before speaking in public about precious resources they don’t know a damn thing about and have done not much of anything about until other people’s property and private affairs became a political opportunity for them. And that includes elected officials and reports who don’t have a clue. Gregory C. Baggett, NYC HDFC