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Yesterday the state's highest court ruled that it was illegal for Tishman Speyer to raise rents at Stuyvesant Town and Peter Cooper Village beyond certain set levels while also receiving tax breaks from the city for major renovations. Now landlords are afraid the ruling will impact their ability to flip rent-regulated apartments into luxury units. Ed Kalikow, whose family owns 2,000 apartments in town, tells the Times, "It's terrible for the industry. A lot of people bought property with the thought that they would get the rents up. People made decisions on that. Banks made loans. This decision is another nail in the coffin." There is not a violin on Earth tiny enough to play at that funeral!
Joseph Strasberg, president of the Rent Stabilization Association, believes the landlords of as many as 80,000 apartments will be affected by the ruling. At Stuy Town and Peter Cooper, 4,352 of the 11,227 apartments have rents at market rate, up from 3,189 when Tishman Speyer made the controversial move to buy the sprawling complex for $5.4 billion, which until then had always been a rent-regulated oasis for the middle class in Manhattan. It's now worth maybe $2.1 billion, and Tishman Speyer may have to pay out an estimated $200 million in rent overcharges and damages to tenants.
Tenants at Stuy Town were elated over yesterday's ruling, and in a separate article, the Times visited the complex to gauge the reaction. One resident, Thomas Lim, pays $3,300 for a one-bedroom apartment. With Tishman Speyer now forced to turn market-rate units back to rent-regulated apartments, Lim estimates he'll soon be paying $1,000 to $1,300 less each month. He's also under the impression the reduction will kick in immediately, and when another tenant heard that, she crowed, "Immediately, you think? Yeah, baby."
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ok - at a reduced rent of say $2,000 why doesn't Lim own? That's such a waste of money to throw away on rent.
thank you mr. van winkle
NOT that it's ANY of your business, but, perhaps Mr. Lim is:
1.) Self-employed, so unable to anticipate his nut, from month to month;
Still, with so many people spending more than 50% of their income on their housing, the need for real and affordable housing cannot be overstated. The bitter and entitled are likely merely jealous. Indeed, if one COULD afford $4000 month (or more) it seems practical to buy; on the other hand, you NEVER know what people's circumstances are, so shouldn't judge their investment decisions by your own (narrow) viewpoint.2.) In debt and paying off other, higher interest commitments;
3.) Supporting his Mom;
4.) Has bad credit;
5.) Is only in NYC for a limited (not forever) period of time;
6.) Travels frequently so can't properly caretake his investment;
7.) In short...any number of reasons for NOT wanting, or the ability to own.
Here is the decision:
http://www.nycourts.gov/reporter/3dseries/2009/2009_07480.htm
So how do I get in on this settlement should it actually come to pass? By my calculations they owe me something on the order of $25,000. Not that I think I have the slightest chance in hell of getting paid. Fiance thinks they'll just let the LLC go bankrupt, auction off the property and of course, the tenants will be last in line at bankruptcy court. Talk about a pyrrhic victory for the tenants...
Landlords can't gouge tennants anymore? When they're reduced to housing people, it's time to pack up and move to Wall St.
"A lot of people bought property with the thought that they would get the rents up."
If your business plan consists entirely of raising rents on low and middle income people you might want to reconsider your values system.
Forget moral values.
If your business plan consists of replacing current renters with new renters who can pay more in a recession where new buildings stand empty, it's not a smart, viable business plan.
Boy, I really feel sorry for the guy who owns 2,000 apartments and then wants more money by forcing out tenants.
Tuff times for greedy developers all right.
so what should rents in new york city be? how should they be figured? what percentage of apartments should be under control or stabilization programs? (it's about 70% now iirc)
not defending folks who own buildings in manhattan (or the people who choose to live in one of the more expensive markets on earth, for that matter) but i do hear a lot about greedy landlords and always wonder how people are figuring out what apartments should cost, as opposed to what they do cost.
There is a process (handled by DHCR, IIRC) already in place for tenants of rent-stabilized apartments who believe they have been overcharged and according to what I read on the Times's Web site yesterday, tenants who benefit from this court ruling may have to go through it to get their money back. This means refunds will be far from immediate, and with this huge pool of new petitioners, DHCR will have to hire more staff and if it doesn't, the process will take even longer. Furthermore, DHCR goes back only four years.
Another possibility that the Times raised is that a landlord might pay the J-51 tax breaks back to the City instead of paying the rent increases back to the tenants.
The statement "DHCR goes back only four years" is wrong. Not if fraud is involved.
See Grimm v DHCR -- Sept 24, 2009 case
http://www.nycourts.gov/reporter/3dseries/2009/2009_06653.htm