A Year Later, Still No Heat on Prospect Place

crownheightster · January 2015

http://www.nytimes.com/2015/01/25/nyregion/a-year-after-suing-their-landlord-brooklyn-tenants-still-lack-heat.html?partner=rss&emc=rss&_r=0

whynot_31 · January 2015

940 Prospect Place

Crown Heights

That article matches my impressions of how effective Housing Court is.

Here's some of what the NYT leaves out:

"940 has been in legal limbo for a long time, with a four million dollar lis pendens on it. It narrowly escaped the auction block in 2013. With all of the changes in Crown Heights these days, I wonder what will become of this building. It’s only half a block from Brower Park, and it, like 930, has 16 units in it."

http://www.brownstoner.com/blog/2014/06/building-of-the-day-930-940-prospect-place/

In other words, this relatively small 16 unit building is four million dollars in debt.

The units are likely rent stabilized, but even if they are market rate, the landlord will NEVER collect enough rent to maintain payments on the debt and perform basic maintenance and services (like heat) on the building.

I don't know what got "him" into this mess, but (sadly) he is likely pursing what is financially best for him: He is making that building vacant through attrition.

The more vacant it becomes, the more valuable it becomes to a new owner.

To try to get a conversation going, let's make up some numbers.

Assume 2 units are already vacant and 4 more tenants flee the cold building this winter. In April 2015, 10 units remain occupied and a new owner buys the building for about $6M. The former owner walks away with $2M, and the creditors are paid their $4M.

Unlike the current owner, the new owner has the resources pay the remaining tenants to leave. 7 units accept a mean of $60k each, $420k

The remaining 3 units won't make a deal. The new owner is ok with that: They are old and will pass away in the next few years.

He spends $2M to renovate the 13 vacant apartments. The investments and renovations free them from rent stabilization.

He has now spent a total of $8.42M (6 + .42 + 2). In April 2016, he sells the building to a large firm for $10M

...after all of the fees and expenses I am too lazy to list, he makes about 500K in one year.

whynot_31 · January 2015

BTW, despite the current situation, this building did not make the list of NY's worst: http://landlordwatchlist.com/#/buildings/brooklyn

...the ones that did are far worse.

pragmaticguy · January 2015

The landlord of the building where my office is located here on St. Johns is on this list for another building he owns. Wonder how long it will take for this building to go into the crapper although it was completely gutted and rebuilt 11 years ago. But then again, some of those violations can be 10 or 15 years old and just never officially removed though the violations themselves have been repaired.

whynot_31 · January 2015

Yes, the DOB is pretty powerless in terms of those violations.

It seems they can't easily turn the violations into meaningful things like fines, so they can't be enforced with the same seriousness of taxes or unpaid water bills.

Instead, the violations just go on a list that is supposed to "shame" the owners.

The DOB has additional tools (such as denying new, unrelated work permits) but if you are a landlord who has decided not to invest any money in your building, that isn't really a deterrent.

whynot_31 · February 2015

Out by Utica, 1717 Carroll seems to be in a similar situation:

http://pix11.com/2015/01/31/winter-weather-takes-a-toll-on-residents-of-crown-heights-building-without-heat/

mugofmead111 · February 2015

Yes, the DOB is pretty powerless in terms of those violations.

And to think City Council is trying to introduce legislation to end the anti-tenant blacklist. The city can't even get a handle on this other issue first!

whynot_31 · February 2015

The city is in a bind, because it is wise enough to know that the buildings with the most violations are not money makers for the landlords.

If the city enforces the regulations on the books, this may cause the owners to simply sell the building to the only bidders willing to buy such properties: Landlords who specialize in getting low income tenants out.

http://www.ag.ny.gov/press-release/ag-schneiderman-secures-agreement-shuttering-company-engaged-unlawful-tenant

Such tenants are among the most likely to end up in shelters, and the city literally can not build shelters quickly enough to maintain compliance with "right to shelter" mandates. It has more people in shelter than ever before.

http://www.coalitionforthehomeless.org/our-programs/advocacy/legal-victories/protecting-the-legal-right-to-shelter/

http://www.wnyc.org/story/homelessness-crisis/

While continued existence of such buildings may not be best short term interests of the tenants who live in them, it serves the short term interests of the city.

whynot_31 · May 2015

Landlord has now been ordered to pay almost $1M in fees and fines:

http://www.nytimes.com/2015/05/03/nyregion/brooklyn-tenants-receive-a-judgment-in-a-heating-dispute.html?_r=0

If the landlord doesn't, the property will likely be seized by the city, and sold at auction.

...to a landlord who may have the resources to flip it.

A Year Later, Still No Heat on Prospect Place

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