City to build new 'Stuy Town'.

The city has announced an agreement with the Port Authority to purchase a 24-acre parcel of land on the Long Island City waterfront where it plans to develop a massive residential complex whose rents will be priced predominantly for the city's middle class.

The Port Authority will receive $100 million from the city, which also will pay $46 million to build infrastructure at the site.

Officials hailed the deal as an alignment of interests between the city and Port Authority, allowing the Port Authority to divest itself of development projects unrelated to its transportation mandate while contributing to a city initiative to provide affordable housing.

"With these kinds of initiatives, my children ... will be able to live in this city without [having] hundreds and hundreds of thousands of dollars," said Kenneth Ringler, executive director of the Port Authority. "And it's good for the Port Authority to be getting out of a business like this and focusing on our transportation primary objective that we're supposed to be focusing on all the time."

The site is the southernmost parcel in a greater 74-acre block of waterfront property called Queens West, which has long been slated by the state for redevelopment. Located in Hunter's Point, just across the East River from midtown, the area is home to a collection of vacant lots and dilapidated industrial buildings, some of which have already begun to be bulldozed to make way for high-end residential and mixed-use development.

Manhattan based Rockrose Development Corporation is building a primarily market rate residential complex at the northern end of Queens West. Avalon Bay Community, a senior housing facility, is being constructed between the site's southern affordable housing component and the Rockrose site.

With sweeping views of Manhattan and easy access to midtown, the value of the land that makes up Queens West has skyrocketed in recent decades. The construction of such a large tract of affordable housing likely would have been precluded had the Port Authority sought to receive market values for the southern parcel, whose development will comprise the latter two stages--3 and 4--of the four-stage redevelopment plan for Queens West.

"We agreed to convey property to the city of New York who really should control a site that is essential to the viability of the city which [needs] long term housing at all income levels," said Anthony Coscia, chairman of the Port Authority.

"I know the passion that Dan Doctoroff and the Mayor feel for this issue and it's been a pleasure to be a partner to them."

Affordable housing has become a hot button issue in the city, where rents have risen in most areas to levels that only the well off can afford.

Uncertainty regarding the middle class's future ability to maintain a significant presence in Manhattan was brought to the forefront last week when Stuyvesant Town and Peter Cooper Village, longtime stronghold for nurses, teachers and policemen, were sold to a partnership of investors led by Tishman Speyer and BlackRock Realty. Residents fear that the complexes will now eventually be converted into luxury housing.

Mayor Bloomberg was eager to cast phase 3 and 4 of Queens West powerful counterpunch to the city's shifting demographics and as a victory in its viability as a place to live for the working class.

"This is a landmark moment in the history of affordable housing in the city, on par with the creation of Coop City and Stuyvesant Town," Mayor Bloomberg said.

"Over the past five years, we've made affordable housing a top priority. We're currently in the process of a $7.5 billion plan to build and preserve 165,000 units of affordable housing over 10 years, enough housing for 500,000 New Yorkers. That's more people than live in Atlanta, Georgia."

Queens West's phases 3 and 4 will create apartments reserved for households whose combined income is between $60,000 and $145,000. Deputy Mayor Dan Doctoroff indicated that rents would range from $1,200 to $2,500 per month. The city plans to issue a request for proposal for the site in the upcoming months and select a developer to carry out the project sometime next year.