Exclusive: Your building is likely rent stabilized and you had no idea

Freedom Tower and canyon of apartments in BPC 6-15-2014(3,000 people have read this as of February 17, 2015. We inform.)

June 18, 2014- By Steven E. Greer, MD

Tom Goodkind, Community Board 1 member and resident of Gateway plaza, has been a long-time activist for affordable housing. He has researched the city tax exemption program called “421a” that was created to give incentives to real estate developers to build new apartments. It was also supposed to make available 20% of the apartments in 421-a buildings as “affordable”.

Back in the late 1960’s, the New York City economy under Mayor John Lindsay was so bad that crime was soaring. The Tonight Show with Johnny Carson fled Manhattan to Burbank. Eventually, under May Ed Koch, the city almost went bankrupt. During the 1977 World Series, Howard Cosell infamously said, “”There it is, ladies and gentlemen, the Bronx is burning.”, when arson set the area by Yankee Stadium ablaze.

To spur investment in new buildings, the 421-a program was created in 1971 to give tax-breaks to the developers. The law was amended several times. In 1984, a provision was added required the buildings to offer “affordable housing” to 20% of the apartments in the building.

In 2008, the real estate developers were cut off from the corporate welfare, and the 421-a program was ended by Mayor Bloomberg. However, those buildings constructed before 2008 still receive the tax cuts, and are still governed by the law.

A little known provision of the 421-a law places all of the apartments in buildings opting into the tax breaks to be regulated under the rent stabilization laws. Not just the 20% of the “affordable housing” apartments are rent stabilized, but all of the other 80% are also rent stabilized. Those 421-a regulations still apply to most Battery Park City buildings to this day.

BatteryPark.TV obtained via FOIL all of the leases for the apartment buildings in Battery Park City. Almost all of the buildings accepted the tax abatements under the 421-a program, including the most recently constricted ones north of Murray Street by Asphalt Green and the ballfields.

This means that every renter in those buildings who signs a lease directly with the building (as opposed to subleases from an individual condo owner) is protected by rent stabilization laws. This also means that rent increases, eviction proceedings, and other steps taken by landlords, are all regulated.

We are working through the mountain of data and law now. Stay tuned.

This entry was posted in - City government, - Community Board 1, - Downtown oversight, - Federal government, - Real estate, - State Government, -- Neighborhoods. Bookmark the permalink.

13 Responses to Exclusive: Your building is likely rent stabilized and you had no idea

  1. fran says:

    I was wondering are we as seniors covered under the senior rent exemption program..?

  2. M says:

    Thanks Steve.

    My building is open about being rent stabilized and my savings against market rent are indicated in my lease.

    I’m in 70 battery pl.

  3. bhauptm says:

    This could be huge. Great investigative journalism, Steve!

  4. Eddie says:

    Correction: The near-bankruptcy occurred under Mayor Abraham Beame. Ed Koch succeeded Beame as mayor and restored some fiscal sanity to the city (which is now being undone by the new mayor)

  5. Caroline says:

    Does this mean the agreement Nadler agreed to – limiting stabilization for a few more years and ending stabilization for new renters for Gateway- is void? That woukd be GREAT!

  6. Neighbor says:

    I also have always known that my apt is rent stabilized. However, I also pay a preferred rent.

    The market rent, which I believe is the amount subject to the rent stabilization rules, is significantly higher. Therefore, my rent climbs quite substantially.

  7. chconkl says:

    I’m a non-stabilized tenant in the largely stabilized Gateway. My rent goes up the same however much they want it to.

    Is this saying that that’s illegal?

  8. Editor says:

    To chonkly

    Bingo! You got it right, sister.

    The best lawyer to call is

    Kevin R. McConnell
    Himmelstein, McConnell, Gribben, Donoghue & Joseph
    15 Maiden Lane – 17th Floor
    New York, NY 10038
    Tel: (212) 349-3000

  9. N N says:

    Has anyone successfully re-negotiated a lease increase with Gateway? Currently living in a market rate apartment in Gateway and facing a rent increase at the end of our lease. Looking for some guidance when dealing with management to get a lower rent increase. Thank you!

  10. N N says:

    FYI, we asked for a rent reduction and they came down by $35 dollars.

  11. JohnC says:

    Can you release the list of buildings obtained via FOIL?

  12. Editor says:

    every single one in BPC

  13. Chester says:

    Does anyone have any info on the future of Gateway stabilization. A couple of friends worried that without Linda Belfer and strong Gateway residents board ( Gupta.org doesn’t seem to be functioning) and Sheldon silver that stabilization won’t continue..especially as Lefrak raised the rent on Catholic Church. I think this would be a great story to follow up on. Many of these residents like the Catholic Church cane back to BPC after 9/11 and rebuilt the community.

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