Goodybe 2011: A year in Review

For those of you new to this blog or trying to get a handle on Predatory Equity in New York City – here’s your down-and-dirty year in review.

Highlights, Lowlights, and the Stuff in Between:

1. Lowlight: In April 2011, New York Affordable Housing Associates sold eight  distressed buildings to Bronx VIII LLC (Townhouse Management). While we still don’t know how much Townhouse paid for the buildings, the disappointing transaction was facilitated by New York Community Bank – who explicitly sold the debt to a developer the tenants did not endorse.

2. Somewhere In Between: In May of 2011, Finkelstein Timberger Real Estate bought the infamous ten building Milbank portfolio for the giant sum of $30 Million dollars. This transaction, which still reeks of over leveraging, was made through financing with Signature Bank. Fortunately for tenants, their advocacy throughout the process meant that all of the tenants are protected by an agreement to ensure repairs, eliminate the quest for back-rent, and cap the amount for potential MCI’s in the next two years. Additionally, six of the buildings entered the city’s Alternative Enforcement Program, ensuring further protection from the horrible conditions these tenants suffered for years.

3.  Highlight: In May 2011, after two years in foreclosure, the tenants at Borinquen Court in the Bronx had their building purchased by the non-profit organization West Side Federation for Senior and Supportive Housing. It was a a hard earned victory and the tenants are looking forward to living in a building with the owner they chose!

4. Somewhere-In-Between: Rent regulation was extended in June 2011! The “grand compromise” however has many complaining about the fact that  rent-regulated affordable housing has not been permanently preserved due to the fact that vacancy decontrol is still in effect.

5. Lowlight: In September 2011, The Bluestone Group sold a group of six dilapidated Bronx buildings to Anthony Gazivoda for a whopping $17 Million dollars. This made for the fourth over leveraging of this severely distressed portfolio.

6. Highlight: In September 2011, 1520 Sedgewick (AKA the “Birthplace of Hip Hop”) was saved! With tenant endorsement, Winn Residential and Workforce Housing Advisors purchased the building with an extensive rehab scope and permanent affordability plan to accompany the acquisition!

It was a busy year fighting for decent conditions and permanent affordability in New York City housing. UHAB organizers, tenants, and allies are still actively fighting to against over leveraging, bad conditions, negligent landlords, and against the banking industry’s bottom-line, top-dollar mentality. As Predatory Equity becomes a clearer and more understood trend,  we sincerely hope that our 2012 year in review will hold fewer lowlights and many more highlights as we continue to develop new tools to fight this rapacious phenomenon.

See you in 2012! We have a feeling it will be a great year!


Victory at Borinquen Court

The Tenant’s Association of Borinquen Court is celebrating this spring: after spending two years in foreclosure the building finally has a new owner.  Borinquen Court is a 145 unit building subsidized by the Department of Housing and Urban Development (HUD) to provide housing for seniors and people with disabilities. The building has a rich cultural history in the Puerto Rican community, illustrated by the name of the project. Unfortunately, this has been marred by years of neglectful owners and management. Eventually conditions deteriorated so much that HUD moved to foreclose on the building in order to obtain a new owner.

The Tenant’s Association, along with organizers from UHAB and Tenants and Neighbors, worked quickly and diligently to identify a potential new owner who would be capable of renovating the building, preserving affordability, as well as collaborating with tenants to provide a better future for the building. The tenants interviewed several groups, and after touring multiple buildings decided that the West Side Federation for Senior and Supportive Housing was the best group to take over the building. WSFSSH (pronounced, “Wish Fish”) worked alongside tenants to gather support and make plans for the acquisition and rehabilitation of the project.

Unfortunately, if the tenants of Borinquen Court believed that their problems were behind them at this point, they were mistaken. Other groups were still trying to buy the building despite tenants’ clear desire to work with WSFSSH. One of these groups, the Neighborhood Association for Intercultural Affairs, along with Foxy Management (the interim management of the building), began lobbying some of the elected officials, saying they had the true support of the tenants. This became critical in Summer 2010, when NAICA produced a list of tenant signatures, arguing it was a petition of support for purchase. Having never knowingly signed a petition, tenants were outraged. (It is believed that Foxy Management had gotten signatures under the false pretence of doing apartment inspections.) To tenant & organizer dismay, the petition was enough for NAICA gained some powerful backing, as documented in this Crain’s New York article.

All preservation campaigns have challenges that will determine the future of the building. For Borinquen Court this was a defining moment. With all the conflict and confusion, the tenants could simply quit the fight, fearing that they could never win, or worse: the tenants could start fighting amongst themselves. However, the Borinquen Court tenants decided they would unite and fight for their homes. They did this with the help of Bronx Borough President Ruben Diaz Jr.

In July, Borough President Ruben Diaz Jr. came to Borinquen Court and moderated a vote for tenants to nominate a new landlord. The tenants voted in favor of WSFSSH 82-4. The meeting was an emotional one, where the tenants reiterated again and again their desire to be heard and supported by both elected officials and those who would be interested in buying their building. The Borough President came out in support of the tenants and the group they chose to work with.

Although it took another six difficult months where the tenants’ choices continued to face opposition, on February 28, 2011, the foreclosure was finally concluded and WSFSSH purchased the property.

WSFSSH has entered the building and has begun some of the much needed work. The Tenant’s Association has celebrated the victory and continues to meet and plan with WSFSSH, excited to see what their building will look like once the rehabilitation is finished. The tenants at Borinquen have demonstrated the power behind tenant organizing, the importance of remaining unified and to never give up when it comes to preserving our housing.