In the middle of November, we published a blog post about a campaign we’ve been working on with a group of 42 buildings in foreclosure in three boroughs. The campaign had recently been covered by the Wall Street Journal. Here’s a quick update for the New Year!
The Three Borough Pool is the biggest foreclosure portfolio since Stuy Town went into foreclosure 2010. It contains nearly 1600 units in 42 buildings spanning across The Bronx, Manhattan, and Brooklyn (hence the name “three borough pool”). The $133 million mortgage is being serviced by LNR, a Florida-based group. The underwriting for this $133 million mortgage was based on the predatory idea that the owners would be able to increase building revenue by raising rents and spending less on maintenance. When tenants were not able to be intimidated into leaving their homes, the mortgage went into default. Though the 42 buildings have been in foreclosure since April, 2013, no receiver has been appointed. There are four owners of the portfolio:
- Normandy Real Estate, which was documented by the New York Times as far back as 2008 as a predatory equity company determined to harass tenants out of their homes to raise the rents to market levels.
- Vantage Properties, who we took on a year ago when they partnered with Lone Star, has also been sued by then-Attorney General Andrew Cuomo for harassment.
- Westbrook Partners, which has also been known as a predatory equity group since as far back as 2008 and has been hit with tenant-driven campaigns before.
- David Kramer, who also runs Colonial Management, the management group in all 42 of the buildings that has been harassing tenants.
The harassment that tenants have been facing is serious stuff. There are buildings that are denied access to their community rooms, repairs in nearly every apartment that need to get done, and a completely unresponsive office that forces tenants to call 311 constantly.
Colonial has also gone through great lengths to prevent tenants from organizing. They sent at least two buildings notices that their buildings were not in foreclosure. They’ve gotten their goons to block organizers from entering buildings despite tenants demanding that they let us in. When that didn’t work, they began calling the police who ignored tenant protection laws and denied us the right to meet in common spaces. When even that didn’t work, they once had their super physically grab organizers and force them out of the building.
None of this has stopped tenants. They are getting organized in well over half of the 42 buildings because they don’t trust their landlords and know that this foreclosure is an opportunity to give them real tenant choice.
Over the past four months, we’ve been working with a diverse coalition of tenant organizing groups to educate tenants about the foreclosure process and engage tenants in having their voice be heard. There have been dozens of tenant association meetings across the city, culminating in a massive meeting on December 17th in the Bronx attended by tenants from many of the 42 buildings to strategize about the next steps of the campaign.
This foreclosure is the greatest opportunity for Mayor de Blasio, his new administration, and the City Council to walk the walk after talking the talk in protecting affordable housing for thousands of New Yorkers. Stand with tenants when they say that any bank or private equity company thinking of refinancing these portfolio with these owners would be out of their mind. With debt at this level, the properties would be destined for another round of neglect and foreclosure. The tenants won’t take it anymore. The time is now to join together and fight for a better deal for rent regulated housing in New York City.