The city has put the brakes on a controversial plan to redevelop a public housing complex in Chelsea, opting instead to form a working group to discuss the fate of the aging and deteriorating developments.

“The residents at Fulton and Elliot Chelsea Houses have waited a long time for full, gut renovations,” Mayor Bill de Blasio stated in a press release on Thursday. “This working group will ensure that the plan to improve these developments meets all of the residents’ needs, because they deserve nothing less.”

The announcement comes after months of protests by activists and tenants opposed to the de Blasio administration’s plan to partner with private developers to build new mixed-income buildings on NYCHA land.

The city has said that it desperately needs to generate revenue to finance $168 million in needed repairs at the Fulton Houses. Including two other NYCHA developments in the area, the agency has said its capital deficit is $344 million. Just last month, the deputy mayor of housing and economic development, Vicki Been, reportedly said she wanted to issue a bid soliciting developers by the end of October.

The Fulton Houses, consisting of 11 buildings between West 16th and 19th Streets, had been targeted to be among the first NYCHA complexes to undergo a dramatic redevelopment under a broader initiative known as NYCHA 2.0. The early plans, released in July, called for razing two buildings and replacing them with three new mixed-income buildings with 700 units. The plan called for NYCHA to lease the land to a private developer, who would undertake the project.

Norman Siegel, a civil rights attorney who previously represented an activist group called Fight For NYCHA, praised the city's decision to form a working group. He and others have criticized the city's efforts to privatize NYCHA, saying that it betrays the principles on which public housing was built.

Siegel told Gothamist that he has called on the city’s comptroller, Scott Stringer, to perform an audit of NYCHA in order to confirm the city’s estimate of needed renovations. He said he is skeptical of the city's numbers.

To date, 550 out of the 943 apartments at the Fulton Houses have signed a petition against the city's redevelopment plan, he said.

On Thursday, the Brooklyn Eagle reported that the city was closing in on an unprecedented deal to sell $25 million in air rights at a Fort Greene NYCHA development. The deal would transfer nearly 100,000 square feet of development rights for a private development next door.

“Ingersoll Houses has extensive capital needs and the sale of air rights for $25 Million will be used to make critical repairs as we move forward to develop a plan that includes additional NYCHA 2.0 tools for ongoing capital investment," said a NYCHA spokesperson in a statement. "We are speaking directly with residents to prioritize how this $25 Million will be spent, and we will address the specific issues that they identify as most pressing, first.”

Nicholas Bloom, a professor of urban policy and planning at Hunter College, said that the projects proposed under NYCHA 2.0 would still not generate sufficient revenue to address the embattled agency's financial needs, which has been estimated to be $32 billion in capital repairs.

"In the absence of outside capital from the state and federal government, they are not going to turn the corner," he said.

Elected officials have also expressed concerns about the mayor's strategy. In September, the city’s public advocate, Jumaane Williams, introduced a City Council bill to create a task force to address tenant concerns at New York City Housing Authority buildings.

In addition to elected officials, the working group will include 12 residents from the Fulton Houses, Elliot-Chelsea Houses and Chelsea Addition complexes.

UPDATE: The story has been revised to say that Siegel is not currently an attorney for Fight For NYCHA. He resigned in September.