New York has officially built its first micro-unit apartment building, called Carmel Place. The nine-story complex, nestled among high-rises in Manhattan’s Kips Bay neighborhood, is a city-sanctioned experiment in living small. While New York’s housing code requires new apartments to have at least 400 square feet of floor space, an exception was made for the tower, whose units range from 250 to 370 square feet. The code also bans entire buildings of micro-apartments, making Carmel Place the first and only of its kind in the city.

The kitchen.

The New York City Department of Housing Preservation & Development (HPD) spearheaded the project, soliciting the most submissions in the department’s history of official requests for proposals. Seeking to introduce a new housing type to the city’s changing market—one that has seen an increase in one- and two-person households—HPD chose nArchitects’ proposal, which featured what would be the tallest of any modular building in New York City. By using city codes as a governing design principle, nArchitects ensured that the plan could be duplicated on nearly any plot in the city.

A Murphy bed saves space.

The units themselves, though small, do not feel cramped. Special considerations were made to assure that more than enough light and air reach each micro-apartment: Ceilings stand at nearly ten feet, and many units feature Juliet balconies. Tenants also have access to storage lockers, a gym, a shared roof space, bicycle storage, and community rooms within the complex. For the project to succeed, it must prove that smaller apartments can be rented for less while still meeting the needs of tenants. Fourteen units will be rented for $950 a month to tenants who meet income restrictions, far below the average price of more than $2,300 a month for Manhattan studio rentals; eight units are reserved for Veterans Affairs Supportive Housing; and 33 others will be set at market value.

A rendering showing the modular construction of Carmel Place.