After Tishman Speyer’s disastrous four-year reign as landlord of Stuyvesant Town/Peter Cooper Village, the commonly held belief was that no one could possibly be worse for the community than that company, with its now infamous business model based around goals that were both greedy and delusional.
However, now it seems that the property’s occupying force, CWCapital, is more than willing to be known as the company that’s worse for tenants than the one that lost its investors billions and scared countless tenants out of their homes. By raising the rents at over a thousand units, in most cases by hundreds of dollars and in others more than a thousand or even two, the suits at CW make it clear that they have learned nothing from the historic mistakes of the past.
Never mind that the move is just plain cruel ― as noted by Council Member Dan Garodnick last week ― “a mid-lease rent increase of $900 is nothing less than an eviction notice” ― it is also, quite simply, bad business. By issuing these steep increases on such short notice (the extension of one additional month for tenants to decide whether to stay or go is still short notice), CW has essentially said it doesn’t care whether their tenants stay or go.
But at these newly inflated prices, who can afford to replace these people (who are already paying for the privilege of living in renovated apartments) other than those who are crammed into subdivided apartments or the very rich? And why would the very rich opt to move into a building without a doorman with an owner who feels entitled to raise the rents at any time?
In other words, CWCapital is prepared to deal with a very high vacancy rate, generating no income for a while until the place becomes, officially or unofficially, a hub for students and other transients. Who hopefully for the leasing office agents, don’t read the news.
In the past, the owner has offered $500 gift cards as incentives to residents who refer people to sign leases. Interestingly, last week, an offer made by Stuyvesant Town via its official Twitter page for new referrals was for $500-$2,500. So apparently, getting tenants to recommend the place to their friends and loved ones isn’t as easy as it used to be.
CW has pointed out, correctly, that it is perfectly legal to be doing this. But so what? Back when Tishman Speyer took over ST/PCV, market rate residents almost immediately began seeing double digit increases. Stabilized renters got primary residence challenges. Tishman did this believing a) that it was legal and b) that the sky was the limit and so what if tenants left, because there was more where that came from. But as we all know now, Tishman was dead wrong. It turned out that as desperate as New Yorkers are for housing, most people simply didn’t have the salaries that would allow them to agree to pay through the nose, nor did they want to live under a landlord who was well-known for giving high rent hikes.
Our recommendation: Instead of offering money to tenants to get their friends and families into these renovated units, CWCapital should tell the bondholders to hold their horses. They’ll be paid in full, even if it takes a while longer by charging tenants the rents they actually agreed to pay. It isn’t tenants’ fault that the bondholders signed on to become part of the biggest residential real estate flop in history and therefore, tenants are not who should be made to suffer here.
Not that they’re suffering in silence. Last weekend, the Tenants Association began organizing protests
outside the leasing office, in which they shared with passersby and prospective renters, what problems they’ve faced after signing on the dotted line (noisy neighbors, broken elevators, etc.).
Tenants are also confronting management directly. On the Stuy Town Facebook page, a recent post cheered the reopening of the Oval lawn. The response? One comment seemed to sum things up.
One Facebook user wrote: “You want people to look through floored glasses we the tenants are being treated like dirt no services no laundry room elevators and intercoms that work half of the time and a 30% rent increase that you have fifteen days to comply with or get out shame on you.”
In a post promoting a carnival for kids on the Oval, Facebook user Carla Webb O’Connor had this to say.
“How about the kids that are being kicked out of their homes because their parents can’t afford the ridiculous rent increases?? Not doing anything for them, are you?”
(Those comments have since been deleted.)
The Tenants Association, local elected officials and now Town & Village are calling on CWCapital to reverse course on the rent hikes. CW should, at the very least, give tenants some warning that after ― and only after ― their leases expire, their rents will go up.
Then, CW should charge a rent that isn’t far higher than what’s currently being charged so tenants can actually consider staying.