Mayor Michelle Wu Proposes Tax Breaks to Jumpstart Stalled Boston Housing Projects

Boston Mayor Michelle Wu has proposed $31.5 million in property tax abatements to jumpstart four major housing developments that have stalled due to financial constraints. The package targets market-rate projects that have already secured city approval but lack the financing needed to begin construction.

The proposed abatements are expected to create 1,400 new housing units, including approximately 185 income-restricted affordable homes, alongside more than 1,500 jobs, according to Mayor Wu’s office. The relief amounts to roughly $22,500 per housing unit and involves no net revenue loss to the city.

“Residents urgently need more housing now, and we can’t afford to let approved projects that are ready to build remain stalled because of today’s tough economic headwinds,” Mayor Wu said in a statement.

Targeted Housing Developments Across Boston Neighborhoods

City officials selected four specific projects for the initial round of tax relief because they are closest to breaking ground, according to Chief of Planning Kairos Shen. The targeted sites span multiple neighborhoods and feature high energy-efficiency standards alongside inclusionary development funding.

The developments included in the proposal are:

• One Mystic Avenue in Charlestown: Developed by Fulcrum Global Investors, this 16-story transit-oriented building will create 408 units, with 45 designated as income-restricted.
• 22-24 Pratt Street in Allston: Led by Hines, this project transforms an underutilized industrial site into a 16-story development featuring 318 units, including 27 affordable homes.
• 83 Leo Birmingham Parkway in Brighton: Developed by Nordblom Co., this former radio station site will be converted into 333 units, with 52 set aside as affordable housing.
• Allston Yards Building D in Allston: Led by New England Development, this project plans 341 units, featuring 61 affordable homes alongside retail and entertainment spaces.

These projects are set to generate more than $20 million in inclusionary development funding. City officials evaluated developments featuring more than 100 units that include income-restricted apartments and meet strict energy efficiency criteria.

How the Property Tax Relief Operates

The financial mechanism uses funds from Boston’s $110 million housing accelerator fund, which draws from surplus money in the city budget. Developers will continue paying at least their preconstruction property tax amounts while construction is underway.

Abatements take effect once buildings are ready for occupancy, temporarily deferring a portion of property tax increases over a five- or 10-year period. Only the developer at 22-24 Pratt Street is seeking a 10-year agreement, which will average a 50% abatement over the decade through a structured tax schedule. Other participating properties will follow a five-year plan with a 2.5% annual tax rate increase.

“The developer and proponent are marching the ball down the field, and they’re right at the goal line, and they just need that help to get over, and the tax relief that we’re offering, which is prudent and conservative, will get them over,” Mr. Shen told reporters.

Next Steps and Future Expansion Potential

The Boston Planning and Development Agency Board must review and approve the abatements during its monthly meeting scheduled for next month. A 30-day public comment period is currently open, and city staff will host community meetings to gather neighborhood feedback.

While the initial proposal covers $31.5 million in tax breaks for four projects, city officials have identified roughly 47 developments representing more than 10,000 stalled units that could fit the program criteria. Discussions are underway with about a dozen other developers. Total tax relief across the initiative could eventually reach approximately $100 million to support up to 4,000 housing units, according to statements from Mayor Wu and Mr. Shen.