In the news story "Old school's new life" [July 11], Artspace says it is creating affordable housing from the former PS 109 in East Harlem. But what the organization should say is this is like hitting a casino jackpot for the tenants and developers.
First, New York City gave the building to the developer for $1; I'm sure its appraised value had to be several million dollars. The developer then spent $52.2 million renovating the building into 90 apartments.
That divides into $577,777 per apartment, and if you used an interest rate of 3.25 percent amortized over 30 years, the occupant of each unit should pay $2,511 a month. But instead the tenants will pay only $494 for a studio and $1,022 for a two-bedroom. Most of the $52.2 million came from government agencies, with some from private contributors. Via low-income tax credits, taxpayers will subsidize the heat, hot water, taxes and common charges forever.
This is just unsustainable. This isn't a project that should be sugarcoated as a great thing to be replicated.
Bob Chapman, Levittown