From three-family houses to 175-unit apartment buildings, construction is either taking place or being planned in every neighborhood in Union City.
Although Union City does not have waterfront property or extensive open areas, developers are finally taking stock here. Many abandoned factories and vacant lots are being purchased, and new residential projects are going up.
According to city Tax Assessor Doug Yandolino, in 2000, the city added $30 million in assessed property to the tax rolls. During the following year, 2001, it added $20 million more.
“Prior to that, there really wasn’t much activity,” said Yandolino, saying that in 1996, only $5 million was added, and that only $7 million in added assessments were added in 1997.
Added assessments can include any new developments or major renovations or additions to existing buildings. Other developments that were completed in 2001, but not in time for the year’s tax roll done each October, will be added to the 2002 added assessment amount.
The more taxpaying properties there are, the smaller the share of taxes that each person has to contribute.
Multi-family
New multi-family apartment buildings are popping up all over the city and a few more are on the way. Union City Mayor Brian Stack, who is encouraging development in the city, said that these buildings will help the city in its goal to eventually lower taxes.
“We need the ratables that these new developments will bring in,” Stack said. “Even with the cost savings that we are doing in the city, we still need new ratables.”
According to Yandolino, a 24-unit building being constructed on Sip Avenue will be conventionally taxed. Yandolino estimated that a building of its size could bring in anywhere from $50,000 or $60,000 in taxes each year, a big difference from the $7,147 in taxes that vacant lot previously brought in. However, Yandolino said that the taxes for this building have not yet been calculated.
A 175-unit building planned for 44th Street in Union City was approved by the city’s Zoning Board of Adjustment at their April 11 meeting and will be conventionally taxed. The six-story building, owned by Raffi Arslanian of Hudson Villa, LLC, will replace the Nu Method Dye Factory that was abandoned after a fire more than 10 years ago. The new building will house 165 one-bedroom units and 10 two-bedroom units with a laundry room on each floor.
Some of the larger buildings built in the city will take part in the city’s Payment in Lieu of Taxes (PILOT) program.
This 30-year PILOT program allows the city to collect taxes on the land according to a specific percentage of the property’s gross sheltered rents. Gross sheltered rents include the landlord’s gross rental income minus operating expenses.
Only buildings with six or more units can apply for the abatement based on the landlord’s gross rental income.
With the PILOT program, the city can collect 15 percent of the gross sheltered rent for the first 15 years. During the 16th and 17th years, the city collects 20 percent of the gross sheltered rent. For the 18th and 19th years, the city collects 40 percent of the gross sheltered rent. For the 20th and 21st years, the city collects 60 percent. For the 22nd through the 30th year, the city will receive 80 percent of the gross sheltered rent.
A new apartment building built on 27th and Central Avenue with about 30 units, the Renaissance Building, will fall under the city’s PILOT program.
Sales are up
Large apartment buildings are not the only residential properties being built in Union City. Many new two-family and three-family residences also are being built.
“Once one person starts fixing up [her] home or a new building comes in, it catches on,” said Stack. “These little things can really make a big difference in the area.”
These houses, which sold for about $250,000 in 1999, are now selling for more than $300,000 in some areas, and more in other parts of Union City. Low interest rates are encouraging people to buy.
“The prices keep going up and we don’t see any slow down,” said Yandolino.
According to records in the tax assessor’s office, in 1999, a two-family house on the 100 block of 36th Street sold for $267,000 in August, and another sold for 279,000 in December. But in 2001, a three-family house on the 500 block of Sixth Street sold for $338,000 and a three-family home on Manhattan Avenue with a view of the New York skyline sold for as much as $600,000.
This year, a three family house on Third Street sold for $360,000, and on Broadway between 47th and 48th streets, a three-family house sold for $380,000. These prices are about $100,000 higher than homes bought in 1999.
Yandolino also noted that apartment buildings are selling at higher rates as well. According to Yandolino, the pre-war apartment buildings that were once being sold for $15,000 to $22,000 per unit are now being sold for $40,000 to $55,000 per unit.