The developers behind Harlem’s Victoria Tower are taking the city to court, claiming bureaucratic foot-dragging cost them nearly $17 million in tax benefits that could imperil the tower’s finances.
Danforth Development and its partners — Exact Capital, the Lam Group and Falconwood Corporation — allege in a Manhattan Supreme Court suit that the Department of Finance wrongly denied their application for a full Industrial and Commercial Abatement Program break on the 26-story tower on 125th Street, Crain’s reported.
Completed in 2023, the $80 million project blends 191 residential units and a 210-key Renaissance hotel above the restored Victoria Theater with a 25,000-square-foot state-backed cultural center anchoring the base.
The developers say they were entitled to roughly $33 million in property tax relief over 25 years through ICAP, a tax break meant to spur investment outside the city’s core business districts. Instead, DOF capped their benefit at $16.5 million, citing outdated filing rules, according to the lawsuit.
The dispute turns on when the project “officially” began.
Danforth filed its first ICAP application in 2014, but the developer filed renewed permits in 2017. Over time, escalating costs from pandemic delays pushed the budget far past initial estimates.
The developers asked to shift the project’s start date from 2015 to 2017 so the tax calculation would reflect its completion in 2023. DOF allegedly refused, saying the request relied on ICAP rules that didn’t exist when the original application was filed.
That timing gap, the lawsuit claims, was the city’s fault. The lawsuit stated that DOF waited nearly a decade after state and city lawmakers created ICAP in 2008 to finalize implementing regulations — a lag that the lawsuit says violated separation-of-powers principles and undermined the program’s purpose.
A DOF spokesperson defended the decision, saying the agency administers programs “within the parameters established by state and local law.”
Danforth founder Steven Williams declined to comment to the outlet.
— Holden Walter-Warner
Read more
Danforth enlists Ariel Aufgang for design of large-scale Harlem development
Harlem Victoria Theater redevelopment to break ground late this year
Lam Group scores $168M for Apollo Theater residential project
