We often refer to New York having an "affordable housing crisis." In this terminology, as in the phrase "2008 economic collapse," or "Albany is a cesspool of corruption," it's easy to lose sight of the individuals driving the phenomenon. But in real estate offices across New York, there is an army of people who go to their desks every day and, whether or not they care to acknowledge it, work to make the lives of working people worse.
On Wednesday, a flock of these apparatchiks looking to further despoil Brooklyn of its affordable housing stock gathered at a summit hosted by the commercial real estate brokerage TerraCRG. Held at the Brooklyn Academy of Music, the men's room at the Only
Brooklyn.® conference featured such light banter as this, according to The Real Deal:
“Careful when you go outside or some tenant group will bust you,” a young real estate professional with a Gordon Gekko-esque hairstyle joked inside the men’s room.
“They don’t have to,” a colleague fired back. “They’ve got de Blasio.”
The real estate magazine focused in part on a lecture by housing lawyer Michelle Maratto Itkowitz regarding how to "de-tenant" multifamily rent-stabilized buildings. Itkowitz often says that she works for both landlords and tenants, but her theme for the day, "Tenant Buyouts — The Next Generation," had a decidedly landlord-centric focus. (So, incidentally, do helpful guides on her website such as, "Evicting Tenants For Short-Term Leasing Violations," "High-Tech (But Not Necessarily Expensive) Ways To Prove Non-Primary Residence In Rent-Stabilization Cases," and "Rent-Stabilization Due Diligence For Multi-Family Acquisitions.")
— Katie Plum (@lostplum) June 1, 2016
Now that Brooklyn is Hot! Hot! Hot!, Itkowitz told the crowd, rent-stabilized tenants are starting to realize in growing numbers that they have rights, and that their refusal to move at the first sign of friction might be worth something.
"Things have changed in three years," she said. "Tenants understand implicitly, even if they live under a rock, that there is value for owners, developers, and managers in recovering rent-stabilized apartments. It’s not a secret anymore."
Itkowitz does a lot of public speaking and non-legal writing on housing issues—last year she moderated a panel that included the question of "Is it possible to get too close to your tenant?"—and she frequently emphasizes that harassment, apartment sabotage, inflated rent stabilization filings and the like are not the way to go for profit-hungry prospectors. Fortunately for embattled New York real estate developers just barely getting by in this harsh regulatory climate, there are a variety of legal methods available to pressure out rent-regulated tenants.
Means Itkowitz has advocated in the past include: suing tenants renting out their apartments on Airbnb, installing hidden cameras in common areas to prove that a tenant has another primary residence, and subpoenaing phone and social media companies to get private information that might suggest the same. At BAM, she concentrated on demolition evictions, in which landlords file to demolish a rent-stabilized apartment building and force the tenants to move that way.
To get demolition evictions approved by state regulators, landlords must have plans for a replacement building on file with the city, prove that they have money to do the construction, and have money lined up to pay tenants' moving expenses, stipends, and if they choose, replacement apartments. In a report and in her speech she lamented that few landlords take advantage of demolitions as a means for wholesale de-tenanting, but said if they just got all the money and paperwork in order, it could save them massive headaches like the $17 million payout to the last rent-stabilized tenant standing in the way of new construction at 15 Central Park West.
Where this line of explanation got especially interesting was the Q&A, during which The Real Deal reports that a man in the audience asked, "So can you do demolition eviction and then evict the tenants and then not demolish the building?"
"There’s nothing in there I can see that penalizes you for not demolishing the building," Itkowitz replied. She warned that a "nasty person with a grudge" might try to sue over a bait-and-switch like this.
The state Attorney General's Office declined to comment on the legality of this. Referring to notorious apartment flipper and alleged serial tenant harasser Steve Croman, Crown Heights Tenant Union organizer Esteban Girón said the kind of gray area Itkowitz ventured into is where eager landlords thrive.
"Steve Croman got away with what he was doing for so long and it took years and years and lots of litigation to get him arrested—and he should have been arrested decades ago," Girón said. "What he was doing is illegal. What she’s saying is not so much is that [a demolition bait-and-switch is] legal, but there’s no rules against it yet."
In writing, Itkowitz is more restrained, opting for a view-from-nowhere construct that relies on the kind of false equivalency familiar to readers of daily national newspapers like the New York Times. In one piece, on the changes in the 2015 rent law, she sums up her worldview thusly:
The cycle continues - landlords look for loopholes and will find them, tenants take advantage of the system, a few crazy landlords and a few crazy tenants define the whole discussion in the press, and Albany mashes something together every few years and the law gets harder and harder to understand. Until landlords and tenants can come to the table and discuss housing as the truly mutual interest that it is, rather than always facing each other as adversaries, this cycle will continue for decades.
These things are true: landlords, like this one, do juke the system and deprive hundreds of thousands of New Yorkers of affordable housing that they're entitled to by the spirit of the law, if not the bit of language or lax oversight landlords choose to exploit. And yes, on occasion, rent-stabilized tenants hang onto apartments they don't live in or make five figures renting out their whole place on Airbnb. The difference is that on the whole, one group is padding its fortunes at ever-increasing rates by scraping the most profit possible out of the desiccated resource that is New York City housing, while the other is having increasing trouble trying to hold onto its little pieces of shelter while also feeding and clothing itself, and if lucky, saving a little something for retirement.
The moral limitations of Itkowitz's "objective" observations showed up during her speech yesterday, when she treated tricking renters into thinking their homes would be demolished to get rid of them as a totally reasonable move. Here someone upset at having been forced out of her home under false pretenses became "a nasty person with a grudge," but only if that person had the gall to seek legal redress. Here renting an apartment in New York was exposed as the all-out psychological and legal class warfare that any sane person knows it to be.
"For a landlord to empty out a building is profitable, but it doesn’t ruin their lives like it does for each of the people that get kicked out," Girón said. "They talk about it as if it’s their right to do it, and it’s not. They're probably targeting elderly tenants who probably have no idea that they’re rent-stabilized or rent-controlled, hardworking people who have been paying their rent for decades."
Update June 3rd:
Michelle Maratto Itkowitz emailed us this:
I represent as many tenants as I do landlords. I always have. I have saved many people's homes. I currently represent a 75 year old couple in Stuy Town, being unfairly pushed out of their home after 40 years.
A major purpose and theme of my talk yesterday was to dissuade the development community from harassing tenants, in particular to dissuade them from bringing baseless, frivolous litigation. I encouraged landlords not to lie to tenants. And I was seeking to educate them on the methods that Albany has put in place for rebuilding buildings. Unfortunately, the landlord's bar isn't doing that. If you read the piece, you will see that it is VERY useful for tenants. Everything I write always has both "sides" in mind.
I write a lot for tenants also. Check out "Ten Lies in Your Residential Lease" on my site.
In fact Pro Publica interviewed me for like an hour and a half recently on a landlord and tenant topic the other day. No story yet. But if I was who you have cast me as, I would hardly be a source for that very important publication.
That's why your article takes me by surprise, and why I reach out to you today. I think the city is too polarized on this issue. My message is, and always has been, that landlords and tenants need one another. Landlords provide housing. The city isn't doing such a great job of that. And tenants are landlord's customers.
There are definitely some bad guys and gals out there. You have just wrongly identified me as one of them. And I thought I'd stick up for myself a little by writing to you this afternoon. For whatever that may be worth to you.
To be fair, you actually seem to have hit on some of my better lines. You accurately say that I dissuade harassment. I appreciate that. And you quote that part about landlords and tenants needing to come together. I appreciate that too. So then how am I a "vampire"?
Just know as I sit here this afternoon, working on behalf of this couple who have lived in stuy town since I was 9 years old and before you were born, who are being pushed out not because they did ANYTHING wrong, but because they are older and have the audacity to occupy a 2 bedroom apartment for $1560 per month, that I have to now stave off really mean and abusive tweets and communications because of your article. Maybe the article could be more balanced, and still accomplish what you are trying to do? Maybe if it was more balanced it could better accomplish what you are trying to do? And what I believe you are trying to do, based on all the different directions you went in in the article, and based on your other prolific and excellent work, (forgive me if I am wrong) is report on a complex issue at a complex time.
In a subsequent email, she wrote that she is not teaching landlords "dirty tricks," but that landlords seeking those are now reaching out to her. "I am embarrassed to say this but your story is DRIVING traffic, potential clients, to me!" she wrote. "And NOT the ethical kind."