Here is a video with footage from the Stabilis press conference and building tour on December 3rd. Letitia “Tish” James, who will become our Public Advocate in just a few days, spoke beautiful words of solidarity with the tenants. Tenants spoke about the hardships and appalling conditions they have endured while living in a building with a negligent landlord. Then the tenants lead a tour of the apartments to show some of these conditions. Please watch and share!
MEDIA ADVISORY FOR PLANNING PURPOSES
Kerri White (UHAB), (212) 479-3371, (520) 507-5863 (c)
Ian Davie (Legal Services NYC-Bronx), (718) 928-2889, (917) 751-5992 (c)
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.
Tuesday, December 3rd, 3PM
755 Jackson Avenue, Bronx, NY (Map)
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.
We are excited to announce the release of a powerful documentary by Elaisha Stokes and John Light highlighting UHAB’s Organizing and Policy Department’s work in the Bronx. The documentary highlights two buildings, 836 Faile Street and 553 E. 169th Street, both in the Bronx. UHAB has been organizing and working with tenant associations for a preservation outcome in these properties since 2011. At the making of the documentary, both buildings were in foreclosure, trapped in the cycle of predatory equity, and tenants were living in deplorable conditions.
Almost 2 years later, tenants at 553 E. 169th St. have a new landlord. 836 Faile St., however, remains in foreclosure with private equity company, Stabilis Capital Management as mortgage holder. Tenants at Faile St. continue to organize, and are demanding that Stabilis transfer their building to Community Development Inc., a city-approved preservation developer. They are are being supported by Bronx Legal Services, who will soon be filing a motion to enter tenants into the foreclosure case, and their Councilwoman Maria del Carmen Arroyo. Recently, UHAB has begun to build tenant associations in 7 other Stabilis-related buildings. 836 Faile Street tenants are working with tenants across New York City to demand that Stabilis Capital get out of the rent regulated multifamily housing business.
Click here to watch the Earth Focus documentary about how tenants can come together to fight for quality affordable housing, and stay tuned to this exciting fight.
After two years of tenant organizing, not that much shocks me anymore. I’ve seen holes in ceilings, mold covering bedroom walls, and families living without basic amenities like fridges or stoves. But walking into 755 Jackson Avenue in the Bronx was a shock.
A quick rundown: The building has 11 units and 215 code violations. It’s in HPD’s Alternative Enforcement Program, and on the Bill de Blasio’s Worst Landlord List. The building has asbestos, lead paint, mold, leaks, and two tenants were injured on a collapsed staircase (pictured above).
And if that’s not enough, it’s owned by the one and only Stabilis Capital Management. (In case you forgot, Stabilis is the lender on 836 Faile Street and six buildings in Ridgewood, all of which are in foreclosure and in deplorable condition.)
Wait! Stop the presses! Stabilis owns buildings? That was our question, too, given that we’ve only ever seen them acting as a mortgage holder interested in flipping debt.
That probably was their plan here as well, but things went wrong: Stabilis bought the debt at 755 Jackson Ave while the building was in foreclosure. When the building went to auction, we assume no one bid and Stabilis took the title by default. It seems like it was all a big mistake. With a lot of consequences.
While Stabilis became owner in June, they have done nothing to step forward and claim responsibility for the building. This has left tenants in a position where they don’t know who to call in an emergency or who to pay rent to. It leaves the City responsible for repairs. The building is effectively abandoned.
We’re now organizing at Jackson Avenue and tenants are planning to push Stabilis out of their building. And now that we know how Stabilis treats the buildings they own, we’re doubly fired up to fight against them at Faile Street and in Ridgewood, Queens.
Tenants, elected officials, and advocates are demanding that Stabilis find a responsible way to dispose of this property, and the other distressed multifamily buildings in their portfolio. Check out Councilmember Maria del Carmen Arroyo’s letter to Stabilis Capital here, and stay tuned to our campaign!!
One of the recent trends in Predatory Equity is something that we have not-so-eloquently been labeling a “debt dump.” (We need to come up with a better term.) Essentially, “debt dumping” occurs when financial entities (banks, private equity companies) trade on distressed, foreclosed mortgages in order to turn a profit, with no regard to homeowners or tenants. Private equity companies (read: speculative slumlords) buy up the debt on buildings in foreclosure hoping to finish the case and flip the property once the market improves. This has happened on SO MANY of the buildings that we work in, always to the detriment of the conditions that tenants face in their day to day lives.
DealBook at the New York Times published an article yesterday that underscores this practice. The article points out that while home prices are on the rise, this increase (due to an increased demand) is largely thanks to Wall Street buyers snapping up foreclosed properties. It does not reflect any increase in the ability of low income and working class Americans to buy homes at affordable prices. Rather, the practice is making homes more and more UN-AFFORDABLE to people who, for the most part, are still un(der)-employed.
The New York Times article follows a great article on Colorlines that essentially says the same thing. (“It’s not a Housing Boom, It’s a Land Grab.”, as featured in last week’s Friday News Round-Up.)
In multifamily housing, where we work, this problem has an interesting dimension. As Wall Street buyers buy up debt and stall the foreclosure waiting for the market to improve, court-appointed receivers continue to manage the building. The problems with receivers are well-documented and have been talked about on our blog — they just don’t have the capacity to make the repairs that tenants deserve. Wall Street speculators can wait on the bet they’ll make money; tenants can’t wait for repairs! This sort of predatory practice that leaves tenants in the line of fire is unconscionable.
The equity company Stabilis Capital Management presents an example. In December 2011, Stabilis purchased the debt on six very distressed buildings in Ridegwood, Queens, an up-and-coming (i.e., gentrifying) neighborhood just across the border from Bushwick. The buildings share an owner and mortgage, and have been in foreclosure since 2007. Tenants are stuck with a non-responsive management company, no receiver, and no one to call when the inevitable problem arises. Stabilis has no discernible plan for these properties, and have not returned tenants’ repeated requests for meetings. Tenants are organizing and hope that a nonprofit mutual housing group can step in, take the buildings, and rehab them at no cost to tenants. Stabilis will have to accept a discount.
In this day and age of rampant debt-dumping, it’s going to require a fight. It’s time for organized tenants to sound the alarm, loud and clear, that unless this practice is stopped, another housing bubble and bust is on the way.
Today, the NYC council will vote to pass a bill, sponsored by Councilmember Gail Brewer, that will force city slumlords to abandon quick fixes in favor of high quality, lasting repairs. The bill is based on the city’s relatively successful AEP program, which gives the city the power to repair problems themselves as well as collect both the costs and fees of the service.
The bill is the result of hard work and cooperation between the New York City Council and the housing advocacy community, including UHAB, Tenants and Neighbors, Legal Services and ANHD.
This morning, Speaker Christine Quinn and Councilmembers Gail Brewer, David Greenfield, and Robert Jackson expressed their support for this bill in a press conference at City Hall. In arguing for the bill’s passage, she told the story of Kymm Moore, a tenant that formerly lived at 836 Faile Street — a building UHAB has been organizing for over a year. 836 Faile Street was in foreclosure for several years when private equity company Stabilis Capital Management purchased the mortgage, presumably hoping to make a quick buck.
While living at 836 Faile St., Kymm suffered from recurring leaks and mold. Because of the recurring nature of these problems, the City Council believes that passing this bill will successfully eradicate these issues. Both Speaker Quinn and Councilmember Brewer noted that the program will lessen the cost of housing code violations for New York City tax payers, by reducing costly inspections and providing the City with stronger tools to collect fees.
Last month, the New York Daily News visited tenants at 1507 St. Johns Place and spoke with them about their views on the measure. While tenants are hopeful that the bill will improve the quality of repairs, 1507 St. Johns Place, like 836 Faile St., is in foreclosure. The bill does not address how it will hold non-owner receivers responsible for the same repairs as landlords. In New York City, multifamily buildings continue to face foreclosure in startlingly high numbers, and the overloaded Supreme Court means many buildings stay in foreclosure for several years. It is necessary that the City of New York hold receivers and banks responsible for housing conditions as well as landlords.
Stay tuned as more articles come out about this exciting measure today! We’ll be posting them here.
“City Council to Push Owners for Core Repairs,” Wall Street Journal
“NYC Landlords Must Fix Problems Under New Law” The Epoch Times