Newsday: Fairfield Properties spends $167 million on senior apartments
A Long Island developer claimed he needed property tax breaks in order to make two residential projects feasible. Five years later, he sold both developments to Long Island’s largest apartment holder – Fairfield Properties – making tens of millions in profits.
“The estimated rates of return suggest both projects would’ve been feasible without tax perks, said Greg LeRoy, executive director of Good Jobs First, a group seeking accountability in economic development and pushing for state legislation that it says would reform IDAs.
Tax incentives are meant to make projects profitable enough that developers will risk their private equity, LeRoy told Newsday.
“In this case, twice over you’ve got rates of return way, way out of the risk zone,” he said. “They strongly suggest that the incentives were not necessary.”
LeRoy said IDAs should structure their deals so that the public splits the profit when projects are sold and incentives are transferred to the new owner, as has happened with both Sutton Landing developments.
“If your profits are going to be boosted by this tax exemption, then we should participate in that,” LeRoy said.
Read the full story at Newsday.