New York’s got housing potential

New York is facing a dire housing crisis. Gov. Kathy Hochul estimates that 800,000 new homes are needed in the next 10 years to meet rising demand. At the same time, average rent in New York City has risen 30%, and home prices outside the five boroughs have risen at least 50% since 2015.

The governor has responded with executive action, creating a new “pro-housing community” designation that prioritizes funding for municipalities exploring how they can unlock their “housing potential.”

There are different models for supporting that potential, depending on the needs they serve. From factory-made homes in the suburban and rural areas of Central New York to the streets of New York City, where former hotels are being renovated through adaptive reuse to create affordable housing.

Lenders have played an important role, as well, in supporting ambitious housing projects in Buffalo and other parts of Western New York. And growth is coming to Clay, just north of Syracuse, with Micron building a huge multibillion-dollar semiconductor factory. The project, slated for completion in 2028, will create 50,000 jobs, including 9,000 at Micron, and tens of thousands of construction, supplier and support roles.

Banks expect a surge in home production to answer the demand once Micron is up and running. Unions, meanwhile, will be looking to create temporary housing for their members as the work on Micron gets underway.

“We have a lot to build in a short amount of time,” said Syracuse Mayor Sharon F. Owens during a fireside chat at last week’s New York State Association for Affordable Housing conference in Albany.

Owens, speaking with Liz Benjamin, managing director of New York public affairs at Marathon Strategies, discussed how housing needs differ sharply across the state, especially between upstate communities and downstate suburbs. The mayor noted that Syracuse’s housing strategy focused on urgency, inclusion, and flexibility. Syracuse is ready to “Build, build, build!” she told the audience, but the question was not how much housing would be built. It’s more about what type of housing gets built, and for whom, she said.

Owens pointed out that Central New York communities need to consider zoning changes that allow for more housing types, and to make sure that affordability is required in larger developments. She also called for more mixed-income housing, as well as supportive and specialized housing for people with developmental disabilities.

Community engagement, she said, was key for countering local opposition and for supporting affordability. She pushed back on narrowly defining affordability, since housing insecurity can impact a wide range of people depending on income and housing costs. Her broader message was not just about buildings, but about ensuring that people have a safe, healthy, and affordable place to live that allows them to reach their potential. Syracuse is committed to housing that’s “for all people and all walks of life,” Owens said, whether it’s downtown in neighborhoods with traditional homes, multifamily housing, or other types of housing allowed through zoning reforms.

Modular vs. factory-manufactured vs. mobile homes

Owens called herself a “huge proponent of modular building,” noting its quick installation and affordability, and met earlier this month with Jeff Cook of Cook Properties of Rochester, who quickly differentiated modular from factory-manufactured housing. Cook also distances himself from the outdated term, “mobile homes.”

“In 1976, the Department of Housing and Urban Development took over the regulatory authority of manufactured housing. Prior to ’76, everything was called mobile homes,” he said in an interview with O’Donnell & Associates.

Mobile homes, which are factory-assembled and placed on a chassis, were first built in the 1920s as travel trailers that could be towed across highways. By the 1950s, however, these homes had evolved into larger units meant for permanent or semi-permanent residence. They also began developing an outdated stigma that these homes were for low-income residents, placed in developments that would eventually be referred to as “trailer parks,” a term that doesn’t reflect modern manufactured housing, according to Cook.

Cook explained that factory-manufactured housing is built on an assembly line by companies that can buy large amounts of building materials at once, saving on costs. “And those savings get passed on to the user, which is us,” he said, referring to Cook Properties, the largest manufactured housing builder in New York State. “And then, of course, the home buyer.”

Cook also pointed out that, “It’s always sunny and 70 degrees,” in a factory assembling manufactured housing, meaning homes built indoors avoid inclement weather that can delay traditional home construction. “Most people get a little chuckle out of that, but it’s true, especially up in the Northeast. Even the Southeast or anywhere where there’s extreme temperatures.” He described the factory setting as air-conditioned and “comfortable to work.” “When you have those factors in place, you get a better employee. You get a happier employee, and as such, you’re going to get a better work product.”

Factory-manufactured housing leaves the assembly line 80% to 90% completed. Modular housing, by contrast, arrives at a construction site in pre-assembled sections that are about 60% complete. Cook said the near-finished, factory-manufactured home, because of all its cost-saving measures and near-completeness upon delivery, can cost as low as $125 to $150 a square foot. By comparison, Cook noted that modular and traditional construction are more around $300 a square foot.

Factory-manufactured homes are primarily set up in suburban and rural communities. But Cook said he also sees urban infill opportunities in the state’s largest cities. “Rochester, Buffalo, Syracuse, Albany, that’s what we’re trying to do, bring manufactured housing to the city.” A three-bedroom, two-bathroom, factory-manufactured home, he said, can sell for about $175,000 to $200,000, a price point that should be especially attractive to first-time home buyers and older homeowners looking to downsize.

The factory-manufactured home model is quickly gaining traction with local lawmakers looking to address the state’s housing crisis.

Republican Assembly Member Josh Jensen, representing New York’s 134th Assembly District, which includes Greece, Ogden, Parma, Spencerport and Hilton, said in an interview with O’Donnell & Associates that factory-manufactured housing is a legitimate and underused part of New York’s housing strategy. The model is a good fit for upstate suburban and rural communities where affordability, land use and local control are central concerns, he said. Local communities are best left to decide what type of housing they need, he insisted, arguing the state treats all housing types with a broad brush and hasn’t fully committed to the factory-manufactured model.

I don’t think New York is, on a macro level, committed to the idea of it as much as we should. I’m a big proponent that more decisions should be made on a micro level, that these decisions about what type of housing, where the housing should go, should be community-led conversations.

Assembly Member Josh Jensen

Jensen also spoke in defense of “good” development operators, opposing legislation last year that would have limited how much developed communities could raise rents to pay for maintenance and reinvestment in the properties. “Critical infrastructure improvements, those things cost money,” he said. “The people benefiting from that are the people who live in that community. If the state puts an artificial cap on the rents, it doesn’t allow for these communities to make those improvements that are critically important.”

“It’s essentially demonizing people who are trying to take care of their residents,” he added.

State Sen. Jeremy Cooney, who represents New York’s 56th State Senate District, covering most of Rochester, Brighton, Gates, Greece and Henrietta, saw factory-manufactured housing as a targeted homeownership and anti-poverty strategy that could benefit Rochester and other upstate cities, as well as potentially New York City.

The strategy starts with unused public parcels of land which can be turned into fast paths to homeownership, he said in an interview with O’Donnell & Associates. He said an often-cited mortgage range of about $120,000 to $170,000 [for first-time homeowners] depends mostly on removing or eliminating the land costs. A “Land Bank” in Rochester, he said, can buy up vacant lots, keep them from being flipped, and then make them available for homeownership at no cost, allowing buyers to focus strictly on the factory-built home itself. This works well in upstate communities with scattered vacant parcels that are too small or broken up for large multifamily developments, he said. Conventional builders typically aren’t interested in these types of parcels because they are dispersed, costly, and difficult to assemble. Cooney has come out as a proponent of factory-manufactured homes as a viable option and warned against confusing them with the trailer-home stereotype.

We’re not talking about that type of product anymore. A lot of people tour these homes and can’t even tell the difference. They don’t even know that it’s factory.

State Sen. Jeremy Cooney

Why “We need to build more housing”

Assembly Member Linda Rosenthal, who represents New York’s 67th Assembly District, which includes the Upper West Side and parts of Clinton and Hell’s Kitchen, and is chair of the Committee on Housing, viewed factory-manufactured housing and tiny home-style housing as potentially useful in parts of the state outside of New York City. However, she reserved judgment on its applicability in the five boroughs in an interview with O’Donnell & Associates after speaking at the New York State Association for Affordable Housing conference in Albany on Thursday.

“We need to build more housing. We need more affordable housing. We need more supportive housing, and we need every other type of housing,” she said, in recapping her remarks at the event. “There are many different models, but not one answers every call, every need. So different models for different needs.”

You know, it is overwhelming at times because New York’s a big state and a diverse state, and there are different needs in different areas of the state, and there are different people who have a lot of money and can buy. And then there are people who can’t really afford much, and it’s for them that we need the housing access voucher program, which is modeled on Section 8. It just began in New York State. We allocated $50 million, two years in a row. We really need $250 million, but it’s a voucher program for people who are on the brink of homelessness, and this will keep them housed.

Assembly Member Linda Rosenthal

Rosenthal highlighted already existing state policy on housing that is answering the call for more housing, citing a range of existing funding streams, including programs that support:

• hotel-to-housing conversions
• modular and starter home construction
• single-family home acquisition or rehabilitation

Additionally, she said the state needs to ensure affordable housing developers have access to the financing and support they need to deliver projects. Rosenthal also noted the state’s support for hotel conversions, mentioning HONDA (Housing Our Neighbors with Dignity Act), which funded converting old hotels into housing.

Read more: Assembly Housing Chair Linda Rosenthal goes On the Record on how to address New York’s housing crisis →

“Adaptive reuse” brings affordable housing to New York City

The AIDS Healthcare Foundation launched its first foray into affordable housing in New York City, opening Harlem Place One a year ago this past August on W. 145th Street. The former hotel was converted into affordable housing, offering 51 single units to qualifying residents, based on income.

“It’s affordable housing. It’s not really supportive housing,” said Marlene LaLota, AHF senior regional director, in an interview with O’Donnell & Associates this month. LaLota explained that Harlem Place One was the first “adaptive reuse” of a hotel, through the organization’s Healthy Housing Foundation. The national program has converted former hotels across the country for almost 10 years.

People just really couldn’t afford a place to live. This all started in LA where you may have heard about all of the tent cities and people living on the streets there, and the rents being so high. So, AHF decided to get into the business of providing affordable housing through adaptive reuse.

Marlene LaLota, AIDS Healthcare Foundation

AHF’s Harlem Place Two, also on W. 145th Street, is set to open in December. Rasheed Gonga, AHF associate director of advocacy and community engagement, said adaptive reuse was the answer to repurposing unused buildings throughout the city.

So, I don’t think that there is one solution to the New York housing crisis, right? Yes, we need to build housing and be able to build housing quickly and affordably to allow people to get in their homes. But there’s also jurisdictions like here in New York City where buildings are sitting vacant for decades that aren’t being used, right? That’s where our adaptive reuse models come in. This building is sitting vacant and there’s people on the streets. There’s no reason why we can’t adapt these buildings to be homes for individuals.

Rasheed Gonga, AIDS Healthcare Foundation, in the same interview with O’Donnell & Associates

Gonga pointed out the cost savings of adaptive reuse over new construction, noting that it’s typically less expensive to convert a former hotel than to raze it and build new. However, policy challenges remain. “On the Albany level, the red tape needs to be cut,” Gonga said, referring to efforts by the state to put housing on the campus of the Creedmoor Psychiatric Center in Queens. Requests for proposals go back to 2022 but were superseded by a new plan in 2025, which is only now in the review phase. The plan is supported by a coalition of housing advocates that has long pushed to turn vacant buildings on the Creedmoor campus into housing. Groups, including Queens Power, working as the “Public Land for Public Good” campaign, have urged the state to develop the campus’ 50-plus acres into 100% income-based housing that would benefit thousands of New Yorkers. Gonga expressed frustration with the state’s slow response.

“Fortunately for us, we have the ability to do this on our own. But most housing organizations don’t have that ability,” he said. Gonga added the AHF would still welcome financial support from the state as it looks to expand its Healthy Housing program in New York City.

Lenders jump on opportunities to fund housing

Banks have stepped up to help fund ambitious housing developments across the state. Most recently, Micron coming to Central New York has generated interest from lenders who could potentially fund the construction of homes for thousands of workers expected to move into the area.

Central New York is experiencing significant growth, driven by new investment, expanding industries and increased economic activity across the region. As that momentum continues, ensuring there is enough housing to support residents, employers and future workforce needs will remain an important priority.

Jonathan Sandgarten, senior vice president, commercial banking team leader at M&T Bank, in an email interview with O’Donnell & Associates

Gov. Hochul’s Housing Central New York Fund, announced earlier this year, will provide $150 million in public-private financing. It includes $30 million from Empire State Development and $120 million from partners, including Micron, and it aims to build at least 2,500 mixed-income workforce homes in Central New York counties over the next seven years.

“Programs like the Housing Central New York Fund can help advance projects that add to the region’s housing supply,” Sandgarten said, in support of the governor’s initiative. “In today’s environment, many developments require a thoughtful combination of financing sources and partnerships to bring projects to life, making initiatives that help attract capital and close funding gaps especially valuable.”

He noted that from M&T’s experience, “working across the market, addressing housing needs will require collaboration among developers, lenders, public-sector partners and community stakeholders.”

“No single solution will meet the region’s growing demand,” he added. “But continued investment, innovative financing approaches and strong partnerships can help create meaningful progress.”

Union labor’s expectations for housing growth

Jim Mason, regional manager for Central and Western New York at the North Atlantic States Regional Council of Carpenters, which will be looking to provide union labor to build the Micron plant, noted that Central New York was already short on housing. With Micron coming, demand will intensify, Mason said in an interview with O’Donnell & Associates.

“There’s a lot of developers that are automatically coming to the area because they know about the shortage,” he said. “There are a lot of large properties that they’re already looking at purchasing and developing for different housing projects.”

Mason expects to see a surge in mixed-income housing, as well as market-rate and more affordable housing.

“That’s definitely been part of the conversations in the area of Oswego County, which is the next county over from Onondaga County, which is where I live,” he said. “They’re already starting to make projects that are going to be shovel-ready.”

Union labor will also likely require housing for the amount of work that the growth in the area will bring.

There are developers that are looking in the area, just to look to put in some type of temporary housing for different workers for the construction projects that are going to be temporarily here. Yeah, we say temporarily, but keep in mind it’s a 20-year project. So, when they say temporary, I think it’s more long-term than people are saying.

Jim Mason, North Atlantic States Regional Council of Carpenters