Tax break deal will keep Lake Ronkonkoma senior apartment complex affordable, developer says
Developer L+M is one step closer to buying 336 senior, affordable apartments on Round Pond Road in Lake Ronkonkoma. Credit: Newsday/Thomas A. Ferrara
A New York housing developer won significant property tax breaks to buy hundreds of senior apartments in Lake Ronkonkoma for more than $125 million — and has pledged to keep the units affordable.
The Brookhaven Industrial Development Agency on Wednesday agreed to cut property taxes by about half for L+M Companies on the condition the developer keeps the 336 apartments at 1507 Round Pond Rd. affordable for the next 30 years, according to L+M's IDA application.
The apartments, spread across several buildings on a quiet cul-de-sac, are rented to seniors 62 or older who pay 30% of their income toward rent, according to L+M's application. The federal government makes up the rest of the bill through the Section 8 program.
The property is the largest affordable senior housing complex in the Town of Brookhaven, according to a 2023 report on housing prepared for the IDA.
Last month, representatives for L+M told the IDA that if it were awarded tax benefits, it would spend $14.6 million on renovations and keep the units affordable by extending the property's contract with the U.S. Department of Housing and Urban Development, which oversees the Section 8 program. That contract expires in September 2027, according to HUD.
The IDA unanimously approved the reduction. Lisa Mulligan, CEO of the IDA, did not respond to questions about the final tax cut, but L+M had proposed a reduction from $862,000 to a base of about $457,000, with payments rising steadily over 30 years, according to a cost-benefit analysis prepared for L+M.
L+M would make payments over a 20-year agreement with the IDA, which would be renewed for another 10 years if the Section 8 contract is also extended, IDA Chairman Fred Braun said Wednesday.
L+M also requested up to $766,500 in sales tax exemptions for renovation work and up to $794,250 in mortgage recording tax exemptions. Mulligan did not respond to questions about whether those tax breaks were approved.
The approval came with little commentary from the IDA, and no residents spoke during a public hearing Wednesday morning. IDA board member Mitchell Pally said he supported approving the tax benefits, though he was concerned that local municipalities would collect fewer tax dollars.
"The concept is fantastic. The need is undeniable," Pally said at the hearing. "I'm not thrilled that the amount of taxes" that will be paid "are less than the amount paid now."
The current owner of the property, Brookwood Ronkonkoma LLC, pays about $862,000 to local municipalities, including about $562,000 to the Sachem Central School District, according to the cost-benefit analysis. A representative for the district did not respond to requests for comment.
Brookhaven Town Supervisor Dan Panico said in an emailed statement the IDA believed the subsidy would “allow seniors on lower fixed incomes to remain" at the complex.
It's unclear when L+M would sign a contract to buy the property. A representative for the developer did not respond to multiple requests for comment.
L+M owns more than 30,000 apartments in the United States., mostly in New York State, according to the data company CoStar. At the May 27 IDA meeting, L+M partner Amanda Ryzowy said L+M would manage the property itself, rather than hiring a third-party property management service. L+M uses property management subsidiary C+C Apartment Management, according to L+M's website.
Residents previously told Newsday the buildings were in need of repairs. Ashley Viruet, the deputy director of the tenant rights coalition at Legal Services NYC's Manhattan office, said tenants could write a letter to introduce themselves to the new owners, if the sale closes, outlining repairs and other work needed at the building.
Tenants can also contact HUD and CGI, a private contractor that manages certain Section 8 properties in New York, for help, Viruet added.
"There is strength in numbers," Viruet said. "Introducing yourself and trying to create an open dialogue is definitely the most important starting point."
