The Surreal Estate

Perspectives on Tenant Organizing from the Urban Homesteading Assistance Board

7A Program Fades from Relevance, to Tenant Dismay

Yesterday, tenants gathered at 755 Jackson Avenue with newly elected Public Advocate (takes office January 1st) Letitia James to demand that the owner of their building, Stabilis Capital Management, walk away from the property. (Read about it in the Mott Haven Herald.) Tenants are hoping that Harry DiRienzo of Banana Kelly be appointed as a 7A manager of their building. The property is extremely distressed and effectively abandoned. That the city would appoint a 7A administrator for this building seems like a no-brainer.

However, tenants have reason to be wary. In order to secure a 7A, they have a long fight ahead of them. Last year, tenants from 1058 Southern Boulevard traveled from their homes in the Bronx to Mill Basin to evict their landlord. They were living in serious slum conditions: fuzzy black mold coated the walls of their apartments, their ceilings leaked and it was so cold inside the building that the water leaks froze. One apartment was so terrible that a reporter visiting the building to cover the tenants’ fight began to cry.

Tenants at 1058 Southern Boulevard were hoping to “evict” their landlord through the same 7A program. Unfortunately, the City and the Housing Court did not heed their plea, and slumlord Miriam Shasho still runs the building. (The building eventually got repairs though the City’s Alternative Enforcement Program, but the repairs are patchwork the building is already returning to a state of squalor.)

This morning, City Limits published an article detailing this same experience, but at different buildings, in the Bronx. In the buildings profiled by City Limits, the failure to bring a 7A action baffles even HPD. The 7A program is an amazing opportunity for organized tenants to hit landlords where it hurts the most: in their checkbooks. However, if the City and the Courts are unwilling to invoke this power, it takes a serious tool away from tenants. City Limits talks about how this changed:

In earlier years, when judges ruled in favor of 7As for troubled properties, landlords frequently stayed out of the way and new managers made critical repairs. Owners may even have been glad to have someone else worry about their building. But now, because of the sweeter financial prospects of most Bronx buildings, landlords don’t want to hand their profitable properties over even temporarily. So it takes an even greater push from activists and HPD, particularly when judges seem more reluctant to rule in favor of 7As when buildings that could benefit from the designation are not part of a community crisis.

Tenant leader Lisa Ortega of 1058 Southern Boulevard speaks of her experience fighting for a 7A bitterly:

Its quite obvious that Judge Klein is on the side of the landlords. Landlords with long histories of neglect to buildings are allowed to do and giving financial help and incentive. If a parent neglect or abused their child, the court would remove them immediately. Slumlords control the health and well-being of some of the city’s most vulnerable populations — Why is this not the same for them??

Lisa mentions an important point, one that UHAB has been fighting legislatively for some time. A landlord licensing program could prevent bad landlords and negligent property managers from buying up extremely distressed housing and treating like an ATM. How could something like that work? Only qualified developers would be able to purchase housing that meets a certain level of physical distress. The 7A program could be expanded, and automatic: one’s license to manage property could be immediately revoked if building’s level of distress meets a certain threshold. If a restaurant owner is serving up unsafe food, the Department of Health shuts them down immediately. Bad landlords are allowed to keep their property no matter what psychological or physical warfare they are taking out on their tenants. This doesn’t make sense.

Make sure to check out the article in City Limits, and stay tuned!

Public Advocate-elect Letitia James, Members of the New York City Council, Bronx and Queens Tenants, and Advocates Demand that Investment Firm Stop Putting NYC Affordable Housing at Risk

IMG_4806For Immediate Release

Contact:
Kerri White (UHAB), (212) 479-3371, (520) 507-5863 (c), kwhite@uhab.org
Ian Davie (Legal Services NYC-Bronx), (718) 928-2889, (917) 751-5992 (c), idavie@ls-nyc.org

Fed-up tenants, sick of Stabilis Capital Management speculating on their homes while conditions worsen, call for the firm to transfer distressed properties to capable owners.

December 3, 2013, Bronx, New York — Public Advocate-elect Letitia James and tenants from eight buildings across New York City gathered this afternoon outside 755 Jackson Ave in the Bronx to demand that Stabilis Capital Management transfer various buildings to city-approved preservation developers. The tenants were also joined by the Urban Homesteading Assistance Board (UHAB) and Legal Services NYC (LSNYC) and representatives from the offices of Council Members Maria del Carmen Arroyo and Diana Reyna.

Stabilis Capital Management (Stabilis), a private equity company which holds the mortgages on, or owns, the eight deteriorating buildings, has been acquiring distressed debt on multifamily buildings in foreclosure across the City. Tenants residing in the buildings, many of whom are elderly or disabled, have struggled to endure hazardous, substandard living conditions because Stabilis has neglected to complete repairs or assist with court orders to address housing code violations.

“I am incredibly concerned not just for the safety of the families in these buildings, but for tenants throughout New York City who find themselves facing deplorable housing conditions as winter sets in,” said Council member and Public Advocate-elect Letitia James. “We will continue to fight to ensure that residents are not the victims of such dangerous lending practices.”

Conditions at 755 Jackson Avenue have declined dramatically since Stabilis took ownership in June of this year. Residents suffer from lead paint contamination, asbestos exposure, rodent infestations, and chronic water leaks. In October, the stairwell collapsed, injuring two tenants. The New York City Department of Housing Preservation and Development (HPD) has identified 221 open code violations, an astounding number for an 11- unit building. The building is in such poor condition that it has been placed into HPD’s Alternative Enforcement Program, which is reserved for the 200 most distressed and hazardous buildings in New York City. Tenants plan to advocate for Harry DiRienzo of Banana Kelly to be appointed as an administrator to manage the building.

The announcement came the same day that tenants at 836 Faile Street, also in the Bronx, filed a motion in Bronx Supreme Court demanding that Stabilis provide funds to complete repairs in their building. Stabilis purchased that 36-unit Hunts Point building’s mortgage in March 2012; the building currently has 138 code violations.

“These buildings exhibit the worst effects of predatory equity in New York City,” said Ian Davie, an attorney with Legal Services NYC-Bronx. “Stabilis manages over $500 million in investments, but somehow continues to ignore and evade common standards of decency, to the detriment of all New Yorkers. These brave tenants are taking a stand to protect their families and maintain their right to live in safe homes.”

“It is horrible that my young children and I have had to contend with rat infestations, mold contamination, water leaks, and spotty heat and hot water during the winter,” said Joanna Paulino, a longtime tenant at 836 Faile Street. “Nobody should have to live with these conditions for one day, let alone the months and years that we have endured. We are ready to put a stop to this.”

The Bronx tenants were joined by tenants from other buildings who have experienced the detrimental effects of Stabilis’s lack of management. Stabilis also purchased the mortgages on a 36-unit Queens portfolio in February 2012 – 1821 and 1894 Cornelia Street, 18-14 Linden Street, and 1673, 1675 and 1726 Woodbine Street – which currently list a total of 380 code violations. Tenants fear that if Stabilis continues its involvement as a lender or landlord, it will continue to neglect and mismanage the buildings until they become uninhabitable. These tenants have appeared in bankruptcy court to hold Stabilis accountable, with the assistance of Queens Legal Services (a program of Legal Services NYC) and Cleary Gottlieb Steen & Hamilton LLP.

Tenants in all eight Stabilis buildings face serious health concerns, including cancer, asthma, and injuries caused by falling staircases. Those health problems are exacerbated by their living conditions. The tenants are working with responsible developers who are interested in preserving the properties and are attempting to negotiate with Stabilis. They hope that Stabilis will sell the debt or the buildings to these preservation developers, who would prioritize the health and safety of residents.

“This isn’t investment, this is disinvestment and it harms New York City,” said Kerri White, Director of Organizing and Policy at UHAB. “Stabilis should stop this destructive ‘business’ model and transfer these buildings to a responsible developer who can maintain them and keep them affordable for the families who call them home. We’re standing here today – tenants, advocates, and elected officials – to reiterate that we cannot continue to permit this predatory behavior to exist in our city.”

“For the past 12 years, I have seen too many unscrupulous and predatory real estate investments severely undermine the livelihoods of working families throughout New York City,” said Queens Council Member Diana Reyna. “Stabilis Capital Management must understand that we won’t accept more predatory speculation of land in our communities. I urge Stabilis to consider a bid from a non-profit developer that will ensure the affordability of the properties in question and provide security to the current tenants.”

“The residents of these buildings deserve better,” said Assemblyman Marcos A. Crespo. “No individual or corporations financial interest should depend on the suffering of children and families in our community. Stabilis must allow a preservation developer to take over as soon as possible and complete much needed repairs.”

“There shouldn’t be a place in our community for neglectful landlords,” said Assemblyman Eric Stevenson.

###

Public Advocate-Elect Letitia James, Council Members Maria del Carmen Arroyo and Diana Reyna, Bronx and Queens Tenants and Advocates Demand that Investment Firm Stop Putting NYC Affordable Housing at Risk

MEDIA ADVISORY FOR PLANNING PURPOSES

Contact:

Kerri White (UHAB), (212) 479-3371, (520) 507-5863 (c)

Ian Davie (Legal Services NYC-Bronx), (718) 928-2889, (917) 751-5992 (c)

What
Government leaders, tenants from eight distressed buildings across New York City, attorneys, and advocates will call on Stabilis Capital Management to stop speculating on rent regulated housing and transfer the properties to capable owners.

When
Tuesday, December 3rd, 3PM

Where
755 Jackson Avenue, Bronx, NY (Map) 

Why
Stabilis Capital Management
is a private equity company that has been acquiring distressed debt on multifamily buildings in foreclosure across New York City. Many of these buildings are suffering from extreme neglect, yet Stabilis has refused to complete meaningful repairs to protect the well-being of tenants and their families. Conditions at 755 Jackson Avenue have declined dramatically since Stabilis took ownership of the mortgage in June 2013. Stabilis’s practice of speculating on properties to the detriment of the tenants is known as predatory equity.

Tenants at 755 Jackson Avenue have invited elected officials including Public Advocate-elect Letitia James and Council Members Maria del Carmen Arroyo and Diana Reyna on a tour of the building to demonstrate deplorable housing conditions and tenants’ concerns about Stabilis’s inability to manage these properties. The tenants are also inviting residents from seven other distressed New York City properties controlled by the firm. The tenants are calling for Stabilis to sell the debt and/or buildings to preservation developers who will prioritize the health and safety of the current residents.

Photo, video, and press availability.

Victory Upstate!

Today we’re deviating a bit from our Friday news round up theme to tell Catherine Lennon’s story. Catherine is from Rochester, NY: a fierce little city upstate that I am also from, and which has seen some of the most powerful eviction defense and direct action against foreclosure in the Take Back the Land movement. Over two years ago, Bank of America foreclosed on Catherine’s home. She never gave up fighting them — both in the streets and in the courts — and this week, her home was deeded it back to her with NO mortgage and NO financial obligation. This is an enormous victory, and it proves that resistance against banks is powerful and it works. People fighting together are are stronger than Wall Street.

But no one should have to fight as hard as Catherine fought for the human right to housing. One home is saved, but thousands and thousands more have been seized. While we celebrate this historic victory, we need to also demand systematic change that cuts down banks and keeps people in their homes. A number of places are experimenting with different ways to do this. New York State Attorney General Eric Schneiderman is suing Wells Fargo for not complying with the mortgage settlement and providing modifications; Ridgewood, CA is moving forward with a plan to size mortgages through eminent domain. People power is the best kind of power there is, and as Catherine’s story shows, it’s effective. But we need to keep demanding more: a world where we don’t have to fight.

Check out the press release from Take Back the Land Rochester below.

In an unprecedented victory, Catherine Lennon, who gained local and national attention after moving back into her foreclosed home after being evicted, was according to public records, recently deeded back her house, without a mortgage. On Friday, November 15, 2013 at 11:30am, Take Back the Land Rochester will hold a press conference with Catherine Lennon at 9 Ravenwood, Rochester, NY 14619 to announce and discuss the significance of Ms. Lennon’s historic foreclosure fight victory.

After her husband died of cancer, Ms. Lennon fell behind on her mortgage. In spite of documented problems with the mortgage and foreclosure paperwork at the hands of Bank of America and notorious foreclosure mill of Steven J. Baum, Ms. Lennon was foreclosed upon. Take Back the Land- Rochester joined Catherine Lennon and waged an eviction defense of the home. The eviction blockade made local and national headlines when the Rochester SWAT-like operation executed the eviction, arresting 7 people, including a 70 year old neighbor in her pajamas.

On Mother’s Day 2011, in a daring act of civil disobedience, Ms. Lennon openly moved back into the home from which she was evicted, with Take Back the Land- Rochester announcing that it was not a “Sit-in,” but rather a “Live-in.” The act garnered national attention, Ms. Lennon was called “the Rosa Parks of the foreclosure crisis,” by former Obama Administration official Van Jones, and the act served as a model for much of the ongoing “Occupy our Homes” and Take Back the Land eviction defenses around the country.

Two years later, Ms. Lennon is making waves again. While many Homes” eviction defenses result in the owner receiving a new mortgage, often with principal reduction, public records reveal that Bank of America deeded the house back to Lennon without a mortgage, as per the demands of Take Back the Land- Rochester.  This is the first known case of a eviction defense ending with an outright winning of the house.  “I’m thrilled with the terms of my settlement, actually I’m beyond words,” exclaimed Lennon. “I’m filled with joy.”  “This is a precedent-setting victory, a demonstration of what’s possible, and preview what’s to come” said Ryan Acuff, an organizer with Take Back the Land Rochester.  “The banks are long overdue to donate tens of thousands of houses back to the community.  We paid for these houses in the bailout.  This victory is the beginning of the next phase of the movement.”

Friday News Round Up!

Made it through another week. Here’s some things that happened in New York while nothing good happened in Washington. 

  1. Big developers and the Department of City Planning are rushing to finish up their final projects before Bloomberg leaves office. Its looking very likely that the next mayor will be a little bit less friendly to big ticket development (and ideally in favor of more affordable housing.) 
  2. Speaking of development: Greenpoint is currently facing a debate that underscores all debates around affordable housing in New York. What does affordable mean? Affordable to who? How much “affordable” should developers provide? Is the AMI even a useful measure of income? 
  3. What does Tish James as Public Advocate mean for the race to be the next City Council speaker? 
  4. Glenn Beck claims that the media focus on Anthony Weiner was simply a distraction, a communist plot to take over the government. It’s funny. 
  5. A coalition of tenants have been fighting against their notorious Predatory Equity landlord, Pinnacle, for years. They charge their landlord used widespread practices to illegally raise rents and push out low income tenants. Though tenants will now be able to seek compensation from their landlord for this malfeasance, tenants are disappointed. This week, a federal judge turned down tenants attempts to appeal an earlier settlement which excluded certain types of claims that Pinnacle could be liable for. We know they’ll keep fighting. 
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