Gov. Hochul signs NYC hotel-to-housing conversion bill in boost for Mayor Adams and city residents

Gov. Hochul signed a bill Tuesday that paves the way for underutilized hotels in the city to be converted into apartments, giving a boost to Mayor Adams who has characterized the legislation as a critical tool for tackling New York’s housing crisis.

The bill — which Adams pushed state lawmakers to pass for weeks — gives the city the power to quickly approve such conversions by allowing hotels to retain their existing certificates of occupancy as opposed to having to secure new ones. It also unlocks $200 million in state funding for the city to bankroll hotel-to-housing conversions.

During a signing ceremony at her office in Midtown Manhattan, Hochul said the bill could not have come at a better time, as New York continues to face a dwindling affordable housing stock, worsened by inflation and other pandemic-driven economic ripple effects.

“Simply put, life has gotten harder and harsher and more costly, and the most expensive of all: Housing,” Hochul told reporters. “So we need to continue to find solutions to this age old problem that has now been exacerbated, and that’s exactly what we’re doing here today.”

During the pandemic, dozens of hotels across the five boroughs stood empty as tourism was put on ice, forcing some to close their doors for good and others to be retrofitted by the city into shelters for homeless people.

Adams, who joined Hochul for the signing ceremony, said there was a silver-lining in that the pandemic showed the city’s hotel market was “over-saturated,” with far more access than demand, while the need for affordable housing only increased.

In addition to affordable housing, Adams said he envisions converting hotels into “supportive housing” for the homeless population, which grew during the pandemic.

“It’s a win for taxpayers, it’s a win for the industry, and it’s a win for everyday New Yorkers who are looking for housing,” he said. “This bill would do more than build apartments — it will transform lives.”

An unlikely supporter of the legislation was Richard Maroko, the president of the Hotel Trades Council union, whose members may work at some of the sites that will now be turned into housing.

But Maroko said the bill has been tailored to make sure that only “failed hotels” will be targeted.

“Too many hotels pay substandard and poverty wages,” he said. “They’re a blight on their communities, and they attract illicit and illegal activity. Those types of hotels do nothing to promote tourism, to create good jobs or to enhance those communities, and those are the hotels that should be repurposed.”

The enactment of the conversion measure comes as Adams and the City Council enter the final stretch of this year’s municipal government budget negotiations.

A major sticking point in the talks has been housing, with most Democratic members of the Council pressing Adams to earmark at least $4 billion in annual capital spending on affordable housing. In the executive budget proposal he released in April, Adams only set aside $2.5 billion for annual housing spending, angering Council members who noted that he promised on last year’s campaign trail to dedicate at least $4 billion.

Adams and the Council must come to a budget agreement by July 1, but a Council member involved in the negotiations confirmed Tuesday that a deal could be reached as early as this week, as first reported by Politico.