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developer in the Bronx is facing scrutiny after securing a tax break for a housing project, only to largely convert it into shelter beds. The Stagg Group's 134-unit complex at 739 East Gun Hill Road has seen over 90 units repurposed for homeless residents, with the nonprofit Acacia Network scoring a $44 million city contract. The shift raises questions about the developer's intentions and potential financial benefits from the change.

    Stagg received a 35-year tax break to help fund the project, which was touted as part of a state program aimed at creating permanent affordable housing. However, Community Board 12's George Torres argues that this is not what the community wanted: "You keep hammering us about affordable housing, but you build a building and turn it into a homeless shelter."

    Stagg maintains that the property still meets tax break eligibility requirements since over 30% of units are income-restricted. The landlord claims it was approached by the Department of Social Services to use the site for shelter beds. A spokesperson said Stagg is "tackling this on both fronts" by improving living conditions and contributing to a better New York City.

    The shift may benefit Stagg financially due to the volume and consistency of city payments, which can be more lucrative than rental income. The developer has also faced criticism from the local community for filing eviction notices against tenants in about a quarter of the building's units, citing missed rent payments. This is not the first time Stagg has faced questions over a project being repurposed into a shelter at a late stage, having done so elsewhere in the Bronx in 2017.