Manhattan’s Overlooked Kips Bay

Kips Bay has been called many things: isolated, concrete-heavy, a way-stop for young professionals. The east-Manhattan enclave can add another label to the list: test subject.

The area has long had a reputation as a stopover for transient young New Yorkers, including workers at the nearby United Nations and five major hospitals on First Avenue’s “Hospital Alley.” The ZIP Code that includes Kips Bay and a section of Murray Hill—10016—has about 54,000 residents, and more than 55% are 34 or younger, according to census data.

For developers, Kips Bay has been a sleepy afterthought nestled between better-known Murray Hill and Gramercy and the residential complexes Peter Cooper Village andStuyvesant Town. It is bounded by East 23rd and East 34th streets to the north and south, and by Lexington Avenue and the East River to the west and east.

“It’s always been defined by its lack of boundaries or character,” said Pedro Carrillo, 35 years old, who moved to Kips Bay in 2003 and works in real estate. “But, since I’ve moved here, I’ve seen a lot more families move in, along with the transient postgrads and those from NYU that have always been here.”

The average rent for a one-bedroom apartment in Kips Bay is $3,395 a month, on par with the rest of lower Manhattan, and the average sales price is $1,115 a square foot, roughly half of the rate of tony Gramercy Park, according to real-estate website StreetEasy. Still, the shortage of affordable housing and the displacement of longtime residents from federally subsidized housing is a big issue, Mr. Carrillo said.

Enter the area’s micro-housing experiment, Carmel Place, a 55-unit, nine-story building being built on East 27th Street. Part of a Bloomberg administration initiative to construct more affordable housing, it is the first of its kind being built in New York City and is slated to be finished by year’s end.

All of the units, designed as modules in the Brooklyn Navy Yard, are between 260 and 360 square feet and are designed for singles or couples; through a lottery system, the city received more than 60,000 applications for just 14 available units after the building’s affordable-housing section—40% of the building—is rented out. The project required a zoning variance to allow units smaller than 400 square feet.

“Single-person households are the fastest-growing demographic in the city right now, and it cuts across all income levels, races, backgrounds,” said Tobias Oriwol, project developer at Brooklyn’s Monadnock Development, which is developing Carmel Place with the city. “I think the common factor between all the tenants will be wanting to live in Kips Bay at a price point that doesn’t exist for a new building right now.”

As developers comb through the applications, preference will be given to those who currently live in the Community Board District 6; those with physical disabilities; and municipal workers. Officials say they expect interviews with potential tenants to start in December.

Shopping and Entertainment: If anything, Kips Bay is known for its abundance of shopping and retail options; Kips Bay Plaza has an AMC Loews movie theater, Petco, Staples and a Fairway Market that opened in 2012. It is next to the I.M. Pei-designed Kips Bay Towers apartment complex. Dover Street Market, on East 30th Street and Lexington Avenue, opened at the end of 2013; it has seven floors of high-end fashion outlets.

Food and Dining: The area has a panoply of eating options, including Turkish Kitchen, which serves Istanbul and Anatolian cuisine; Nick’s Pizzabar, which includes a wine bar; and Blue Smoke, a Southern barbecue restaurant. A stretch of Lexington Avenue has been dubbed Curry Hill, named for its many Indian restaurants and spice shops. Great water views can be found at Tom Colicchio’s farm-to-table Riverpark, which overlooks the East River, and Roof at Park South, tucked inside the eponymous hotel.

Parks: The Vincent F. Albano Jr. Playground, on Second Avenue between East 29th and East 30th streets, is a small city-operated park on less than a half-acre once allocated for the abandoned Mid-Manhattan Expressway project.

The larger Bellevue South Park, also on Second Avenue between East 26th and East 28th streets, is named after the nearby hospital complex and features a basketball court and sculptures of flowers, elves, turtles and frogs.

Schools: Kips Bay, in the city’s public-school District 2, is home to P.S. 116, the Mary Lindley Murray School, and the American Sign Language and English Secondary School; Norman Thomas High School on East 33rd Street closed in June 2014 and was replaced by a charter school, Success Academy High School of the Liberal Arts. It now operates grades eight through 10. The School of Visual Arts and the City University of New York’s Baruch College are also there.

In 2015, 59% of District 2 students in grades three through eight received a proficient score—defined as a score of 3 or 4—on the English Language Arts exam, and 67.6% received a proficient score on the math test. In 2014, the results were 55.5% for English and 65.5% for math.

Corrections & Amplifications:
Carmel Place is a 55-unit, nine-story building being built on East 27th Street and the average sales price in Kips Bay is $1,115 a square foot. Earlier versions of this article incorrectly said the building will have 11 stories and the average sales price is $1,5. (Nov. 13, 2015)