New York City’s Department of Housing Preservation and Development (HPD) is putting the word out about an upcoming filing deadline for developers taking part in the 421-a (16) program.
The 421-a program is a partial tax exemption for developers that are building multi-family residential properties on vacant lots. Minority and Women Owned Business Enterprises (MWBE) and small firms taking part in the program may not be aware that there is a deadline to submit a letter of intent to qualify for the tax reduction.
The 421-a (16) program, which passed in 2017, was a compromise deal between construction companies and the real estate industry. It allowed developers to build if they met certain affordability requirements and would be able to complete their developments before June 15, 2026.
Developers that put in a letter to file for an extension will have until June 15, 2031, to complete their projects, but they must get their letters in by September 12 of this year to be eligible for the extension.
“It is very important that projects that want to use the extension file a letter of intent with HPD by September 12,” explained Tricia Dietz, the assistant commissioner of housing incentives at HPD during a video call with reporters. “The letter of intent is necessary to be eligible for that extension. The letter of intent is a form that is on HPD’s website that has information requesting the building address, the BIN number, contact information, and the expected option. It is a non-binding form and projects that still complete by the original completion deadline will still be able to use any of the previous options …
“One of the reasons that we want to provide more awareness of this deadline is because we have received a number of letters of intent, but we are not seeing as many as would be expected in, specifically, smaller buildings and buildings with minority businesses and women-owned businesses, firms, and developers. And we’ve also had concerns about the number of smaller family-owned developers that may not be aware of this deadline. It is very important: This is a one-time opportunity to file this extension. Projects that do not file by the September 12 deadline will not be eligible.”
HPD’s website notes that the Letter of Intent “must be submitted by an authorized signatory of the owner, and is to be submitted online. Successful submission … will result in a confirmation of receipt email, a copy of which shall be required for any 421-a(16) application with a completion date between June 16, 2026 and June 15, 2031.”Questions regarding submission of the form can be emailed to 421-a16_extension@hpd.nyc.gov, or by calling 212-863-6603.