News & Insights

Home » News & Insights » Opportunity Zones and Transit Deserts offer challenges and potential for NYC

Opportunity Zones and Transit Deserts offer challenges and potential for NYC

Real Estate Developments, Real Estate Legality

The New York Times recently reported on the growth of development outside of NYC’s key transit corridors—defined as places less than a 15 minute walk from the subway. Although almost all of Manhattan falls into this category, vast portions of the other four boroughs fall outside of this category and are considered “transit deserts”. Areas like these, once avoided by developers, have seen an increase in interest due to a confluence of market and structural changes. On one hand, persistent high costs in Manhattan spur developers (among many others) to consider more affordable parts of the city. On the other hand, alternative forms of transportation like bikes and subsidized ferries, as well as changing patterns of work (i.e. working from home) have also made the outer boroughs more viable for many people. And although Manhattan continues to be the employment anchor of the city with far more jobs than the rest of the boroughs combined, the growth in employment in the outer boroughs has significantly outpaced Manhattan in the decade since the crash (28.6 vs. 21.5 percent), which suggests a gradual change in the center of gravity of NYC. [1]

How might this trend dovetail with NYC’s opportunity zones? Quite well, it would seem. If one superimposes a map of the city’s opportunity zones, which are tax incentives linked to low-income areas intended to spur reinvestment of profits into economic development, onto a map of transit deserts, one finds tremendous overlap in the Bronx and Brooklyn (although notably not in Queens). Opportunity zones have come under significant criticism of late for flawed zoning design, especially in Manhattan, but they remain a powerful incentive for investors searching for opportunities at a time when attractive alternatives may be scarce. If developers leverage the new trend toward construction in “transit deserts” with the tax advantages of opportunity zones, it could prove to a potent combination for lucrative investment. [2]

[1] Chen, S. (October 2019) Who’s Afraid of a Transit Desert? from NY Times Accessed October 14 2019

[2] Drucker, J. and Lipton, E. (August 2019) How a Trump Tax Break to Help Poor Communities Became a Windfall for the Rich from NY Times Accessed October 14 2019

Recent Posts

Impact of Shorter COVID-19 Quarantine on Workplaces

On Monday, the CDC announced changes to its recommended isolation and quarantine time from 10 days to 5 days for asymptomatic people with COVID-19. They recommend that people leaving isolation after 5 days continue to wear a mask for the following 5 days. The CDC also...

Restaurants Sue Over Vaccine Mandate

Restaurant operators sued Mayor Bill de Blasio and New York City over Key to NYC, the new indoor vaccine mandate program, on August 17-the same day the mandate went into effect. A group of restaurants in Staten Island, through the Independent Restaurant Owners...

Financial Regulators’ New Target: Social Media Influencers and SPACs

The Financial Industry Regulatory Authority (“FINRA”) will conduct three new regulatory sweeps in an effort to combat various activities causing extreme fluctuations in the financial markets. FINRA has chosen to target special purpose acquisition companies (“SPACs”),...

Does WARN Apply to Virus Closures?

Enterprise, in Benson et al. v. Enterprise Leasing Co. of Florida LLC et al., has tried to argue that the Worker Adjustment and Retraining Notification Act (“WARN”), through its natural disaster exception, does not apply to closures caused by COVID-19. Two Florida...