The hearing aimed at finalizing the terms of the “Roberts v. Tishman Speyer” settlement agreement will take place on April 9 at 10 a.m. at 60 Centre Street, in Courtroom 408, Alex Schmidt, the tenants’ attorney said on Thursday.
If approved, those terms will include compensation for current and former residents of ST/PCV who’d paid market rent for $68.75 million. With rent savings already received as part of the deal, the total recovery would be $146.85 million. Average payouts for the 21,250 class action members are said to be $3,200. However, residents’ rents may also go up as a result of the settlement.
It was that factor that motivated a Stuy Town couple to try to appeal the settlement in February, but they withdrew their application a week after it was filed, Schmidt said.
At a January meeting on “Roberts” hosted by the ST-PCV Tenants Association, which was not a party to the lawsuit, roughly half of the crowd of 200 people said they were unhappy with their figures. However, tenants’ attorneys said it was the largest tenant settlement in history.
Never mind the gridlock in Congress, a body that “we the people” put in place, which if truth be told seems to be all about I, I, I, Me, Me, Me, or My, My, My…this potential revolution that I am starting here, has to do with banking.
Banks were saved by the American taxpayer! Having had everything to do with their potential failures, the exalted top figures proceeded to give themselves bonuses as soon as our dollars made the banks stronger.
Let me give you a few examples of what seems to me criminal behavior, which used to be called usury.
Shop around and see what interest banks are offering on your money (CDs, money market, checking) that should not be at risk. Pathetic!
Open a credit card at Saks Fifth Avenue or Lord &Taylor, for example, cards which banks manage, and you will find an offer to “lend you money” for purchases at starting rates of 23.99 percent and 25.49 percent!
On the other hand, if you are fortunate enough to have an American Express Card and you charge and pay back over a certain amount, you get back 5 percent on certain purchases. (Charging pays more than saving!)
Things are upside down. The examples I have given are just forthe American public to start thinking about. I have been told of people missing one credit card payment and their interest rate going up to 29.9 percent! And then have heard payment rates being as high as over 30 percent!
Why are banks regulated by the Fed to keep rates so low, causing customers who support the banks to get royally ripped off (to put it nicely, but you know what I mean) and then Congress allowing banks to charge these outrageous usury rates to people, using our money?
Now banks want you to put money at risk and charge you a fee when that is not the intent of most of their customers. “Certain” moneys need to not be at risk and that is what banks were intended to protect. Because of their incompetence (and greed) “they” are trying to change the real purpose for their being.
If banks cannot figure out how to make a bigger profit with our money, not rip people off on both ends – 1) the ones who are saving and being offered ridiculously low rates, the lowest ever, and then 2) ripping off the public who can least afford it, with these usury rates (up to 30 percent) – we need more competent bankers and laws need to be changed! Fair laws would be a start.
We the people are allowing this! I want a revolution in banking to benefit the people! And better bankers!
The following letter was written by several East Side elected officials to Darryl C. Towns, commissioner and CEO of New York State Homes and Community Renewal on the housing agency’s policy towards rent reductions for losses of services like those experienced in Stuyvesant Town/Peter Cooper Village. (The letter, though addressed to the HCR, refers to it as DHCR, its predecessor agency.)
Dear Commissioner Towns:
We are writing to request clarification of the Division of Housing and Community Renewal’s (DHCR) rent reduction policy with respect to tenants who experience a diminution of services, and to highlight an imminent issue in Stuyvesant Town and Peter Cooper Village (ST-PCV).
We are concerned that the DHCR’s policy is incompatible with the Rent Stabilization Code (RSC), and runs the risk of denying tenants compensation to which they may be entitled. Specifically, we seek clarification about a serious discrepancy between the DHCR’s stated policy on rent reduction effective dates and the RSC as it pertains to applications for Rent Reductions for Decreased Services recently filed by hundreds of ST-PCV residents in approximately 110 buildings, who are represented by the ST-PCV Tenants Association.
As you know, these ST-PCV residents filed applications on February 26, 2013 for rent reductions due to loss of services during and after Hurricane Sandy. The lost amenities include loss of trunk storage service, security systems, laundry room services, bicycle and carriage room storage, elevator service and building intercom services.
Section 2523.4(a)(1) of the RSC provides that “the DHCR shall … reduce the rent for the period for which it is found that the owner has failed to maintain required services.” Of course, application of this provision is predicated on the DHCR finding that services in fact have not been maintained, but in the event of such a finding, it is clear that any rent reduction should be effective for the entire period for which the services have not been maintained.
However, it is apparently the DHCR’s practice, as stated in its Fact Sheet #14: Rent Reductions for Decreased Services, that “The effective date for rent stabilized tenants is retroactive back to the first day of the month following DHCR’s service of the complaint on the owner.”
We do not understand why the DHCR’s practice is inconsistent with the RSC. If tenants are denied contractually obligated services, neither logic nor the RSC supports limiting their remedy to the period after the DHCR has had time to serve notice on the owner.
We are particularly concerned with the rent reduction applications recently filed by ST-PCV residents and currently pending before the DHCR. We understand that the DHCR has indicated that it may take several weeks to process these applications, which could delay the start date of any approved reductions even further under the agency’s stated practice.
In light of these serious concerns, we must ask: (1) When do you expect to present ST-PCV management with the rent reduction claims? (2) What is the legal basis for the policy regarding effective dates found in the fact sheet?
Given the time sensitive nature of the ST-PCV applications, and the importance of this issue to the people we represent, we ask that you respond promptly to these questions. If you would like to discuss this matter, please feel free to contact any of us directly. If you would like to arrange a meeting or conference call, Anna Pycior in Assemblymember Kavanagh’s office is available to help arrange one. We hope to hear from you soon.
Brian Kavanagh, State Assembly Member
Daniel R. Garodnick, City Council Member
Carolyn B. Maloney, U.S. Representative
Scott M. Stringer, Manhattan Borough President
Even before the default of the property in 2010, the purchase of Stuyvesant Town for $5.4 billion by Tishman Speyer and its partners only four years earlier had come to be recognized by many as the biggest mistake ever made in real estate.
So why then, was Tishman, as well as countless other key players in the world of New York real estate, not to mention those from offshore and even pension funds and the Church of England, so convinced that a historically middle class apartment complex was in fact an untapped goldmine? And why was the property’s previous owner, MetLife, not held accountable for its initially racist leasing policy while receiving all kinds of breaks from the government for the complex’s construction?
These are just a couple of the questions surrounding the property’s history-making moments to get tackled in a new book by New York Times reporter Charles Bagli, set for release on April 4.
Bagli, who’s been covering major New York real estate stories for the past quarter century, signed a deal with publisher Dutton in 2010 for a book about the infamous Stuy Town deal, Other People’s Money: Inside the Housing Crisis and the Demise of the Greatest Real Estate Deal Ever Made. The book is priced at $28.95 but is currently available for pre-order for $15.98 on Barnes & Noble’s website as well as on Amazon.
This week, Bagli said the book was something he’d been thinking about since he began covering stories about the property.
“The more I learned about Stuyesant Town, the more intriguing it was,” he said. “It had this rich history that most of us don’t know anything about. It’s such a cauldron for the lives of the middle class.”
The book hardly reads like a history textbook though since right from the start the reader is the fly on the wall as negotiations between real estate execs, brokers and attorneys are played out.
Much attention is also paid to the backstory of Stuyvesant Town/Peter Cooper Village, including the initially unsuccessful attempts to make the complex integrated and then over the years, the various attempts by tenants to fight planned rent hikes.
“Every time they did that, the tenants would rise up,” said Bagli. “It’s funny because there were all of these regulations issued in Stuyvesant Town. There were lots of guards to tell you not to run on the grass and rules about the apartments having to be covered in carpets, but on the other hand there was all this rebellion.”
In doing research for the book, Bagli conducted around 100 interviews, many with real estate bigs, including the normally press-wary Rob Speyer. Bagli said he figured Speyer, who spearheaded the doomed deal, agreed to talk due to the fact that he’s interviewed him before, including right after the sale in 2006, but also because they knew each other from 10 years earlier when they both worked at the New York Observer. At that time, Speyer, who later became a reporter, was working as a fact checker.
Other interviewees include developer Richard LeFrak, who was a bidder early on but bailed when the price reached $4.5 billion, and ST/PCV residents, including former Tenants Association President Al Doyle and Council Member Dan Garodnick. There were, naturally also a few individuals who refused to be interviewed on the subject of the Stuy Town sale, including Larry Fink, CEO of BlackRock Realty, Tishman’s main partner on the venture, and Mayor Bloomberg.
During the course of his interviewing, Bagli said he thought it was interesting how many parallels there were between two men who had ended up becoming adversaries, Speyer and Garodnick.
“Both were about the same age, both bright,” he said. “They got involved with a woman during the course of all of this and got married around the same time and had kids the same time. But they represented very different interests.”
Other sources of information for the book came by way of library archives of public documents and newspaper articles, including many from Town & Village, and Met Life’s press archives. Though he never lived in Stuy Town, Bagli’s had connections with the property over time through different residents, including his publisher and agent, who’d both lived there.
While the book mainly focuses on the sale to Tishman Speyer at the height of the real estate boom and the subsequent default after the bubble burst, another aspect of the story is how a greedy industry still hasn’t learned its lesson. Too many players, said Bagli, are still paying for major deals with a two thirds or more of the cost in loans and simply hoping for the best when calculating returns.
“And of course nothing ever is ideal like that,” said Bagli, who noted that when calculating potential rents for Stuy Town, the buildings were compared to a new tower on East 23rd Street with a doorman.
“That’s really not comparable to apartments with one bathroom, 60-year-old pipes and no doorman,” he said. “It was absurd.”
Yet there was no shortage of plans to turn the rent-stabilized property into the goose that laid golden eggs in 2006, including converting the apartments to co-ops, or at least some of them. Ofer Yardeni of Stonehenge Partners hoped to have specific buildings set aside for the elderly after getting those older residents to move out of their two and three-bedroom apartments. Douglas Durst wanted to erect a building on Stuy Town’s green spaces, though he dropped out after bidding climbed higher than $4 billion.
Ironically, it was another one of the bidders, LeFrak, who seemed to be one of the few voices of reason when considering the future worth of the complex. As the owner of 15,000 rent regulated units in Brooklyn and Queens, LeFrak didn’t believe ST/PCV was worth more than $3 billion. Though he did eventually bid as high as $4.5 billion, after being pressured go up to $5 billion if he wanted to play with the big boys, he dropped out.
Like many of its residents, Bagli sees the Stuy Town of today as being in jeopardy since close to half of the 11,232 units are renovated and therefore renting at close to market rate.
“You’re not talking about middle class families anymore and I think it’s a tremendous loss for the city,” he said. “For all the racial history, it’s still a refuge for a lot of people who would otherwise not be able to live in Manhattan or New York City.”
Bagli will be discussing his book, alongside Times columnist Michael Powell, at the Stuyvesant Town Community Center on April 4 at 7 p.m. A preview of a documentary about Stuy Town’s history, co-produced by tenants, director William Kelly and preservationist Marie Beirne, will also be screened. The Community Center is located at 449 East 14th Street.
Dutton Publishers is having an evening of discussion with New York Times reporter Charles V. Bagli, author of the new book, Other People’s Money: Inside the Housing Crisis and the Demise of the Greatest Real Estate Deal Ever Made, at the Stuyvesant Town Community Center, April 4 at 7 p.m.
Other People’s Money starts somewhat like the movie, “Wall Street” (picture, if you will, a Michael Douglas and Charlie Sheen type on their way to 200 Park to cut the deal with MetLife for the sale of the century…this was the Tishman team!). You are the fly on the wall, privy to these negotiations, step-by-step as it swiftly unravels.
Chronicling the creation of the complexes, the book delves into the holiest of holy reigns in NYC history…La Guardia and Moses with Ecker …please genuflect now! The transition of MetLife being owned by policy holders to Benmosche’s “sleeping giant’s” transformation to a stockholder corporation is depicted, and why this redirected the mission of MetLife in regard to its real estate holdings and investments once, revered by insiders as cash cows and sacred.
Bagli nailed the humanity of it all in each tenant of Stuy Town-PCV he quotes; in relaying the history of the ground-breaking WWII veterans tenant-led successful desegregation campaign; and in the depiction of Al Doyle’s and Dan Garodnick’s leadership and profound integrity.
In interpreting the mega-complexity, of the mind-boggling, wheeling and dealing through the years of this historic sale, and the later monumental default that was prevalent and frequent at that time in the “Wall Street Casino,” many readers [like me] will appreciate the explanation of the layer upon layer of complicated debt structure and how the bond holders now still expect to be compensated.
We are now forever in the history books for the notoriety of this infamous deal, but Stuy Town-PCV is our version of the “American Dream” that you hear frequently and vividly defined for the public by the finance community. Our dream is continuing to live in our beloved homes in the middle of marvelous Manhattan.
Bagli’s book is a must read for Stuy Town-Peter Cooper Village tenants and those intrigued by this blockbuster event!
Marie Beirne, PCV Co-producer, oral history documentary project for ST-PCV Tenants Association Landmark Committee
Re: “Book by resident defends his ‘millennial’ generation,” T&V, Feb. 28
Firstly, I commend Mr. David Burstein for his interesting and insightful newly published book, Fast Future: How the Millennial Generation is Shaping Our World. In it he defends the age group he is part of from the many critical comments which have been offered about his 20-something crowd.
Let me add that as an attendee of NYU’s Gallatin School – I have met and heard quite positive comments from many of my students at Baruch College/CUNY that I recommended them to attend this division of NYU.
No individual can represent a group. Past is prologue – so we must know history. Knowledge is power and well-intentioned plans often have unintended negative consequences.
I can compare today’s young people with my peers when I attended Queens College during the 1960s and due to my 30 or so years teaching at Baruch (both CUNY colleges).
During my attending Queens: the fight for black civil rights – especially voting rights was in full gear; in fact a classmate of mine, Andrew Goodwin was killed in Mississippi by the KKK.
Then there was the present incarnation of the feminist movement.
In my days the double standard viv-a-vis sexual behavior was prevalent. Males would obtain prestige the more women they “had” – but, when it came to marriage they wanted a virgin. A conundrum for young women.
Then, the anti-Vietnam War movement, which Nixon cynically manipulated by ending the draft and going to our present volunteer military.
All CUNY senior colleges demanded 90+ HS GPA or superior SAT scores. CUNY was considered as the Harvard for the proletariat. The students were well prepared and interested. Then in the 1970s under political pressure “open-enrollment” was begun and CUNY senior colleges have downgraded their standards ever since.
Then the New York City public school worked (with mostly inferior teachers).
The unintended consequences:
You are far from a representative sample of your age group. You think with consideration… And not only talk the talk… You obviously walk the walk…
From my experience at Baruch, grade inflation is rampant; so is the lack of intellectual curiosity – most attend because it is simply the next step and they want to get the sheepskin (now made of paper) and to please their parents and make (they think) more money. Materialism reigns now more than ever.
The civil rights movement is being replaced by a class paradigm problem and rightly so. And the 1954 Supreme Court desegregation decision has been replaced by pockets of female dominated dysfunctional families imbedded in dysfunctional communities, which no longer work. (It’s not the teachers.)
The sexual revolution has hurt women in many ways: many guys think that “if milk is free, why buy the cow?” Marriage among both genders (if at all) occurs at about five years later than before.
And, celebrities have replaced religious leaders as models for single parenthood. Many women cannot find acceptable males who are willing to make a commitment.
Nixon’s volunteer military takes the poor, minorities and patriotic and aggressive as the rest of the country is told to go shop.
Education on all levels has deteriorated from K through graduate school.
I said that knowledge is power, how important history is and alluded to intellectual curiosity…
It is the fault of the previous generations who have not given (most) “millennials” the tools, which are necessary to build a better and stronger nation. One more comment (and, I don’t mean to be patronizing): – the only constant in life is change.