Council Members Dan Garodnick and Jumaane Williams with tenants at a press conference at City Hall (Photo by Maria Rocha-Buschel)
By Maria Rocha-Buschel
Tenant advocate groups have a message for landlord who harass tenants: You’re being watched.
At a press conference last Thursday, the advocates and elected officials said that they have identified predatory equity landlords who tenants say have been mistreating them and forcing them to live in hazardous conditions. Councilmembers Dan Garodnick and Jumaane Williams, who formed the Coalition Against Predatory Equity last year with Councilmember Ritchie Torres from the Bronx, were at the event.
“We now have names attached to these situations so they know we’re going after them,” Williams, chair of the Council’s Housing Committee, said.
The landlords that have been singled out are Alma Realty Corp., Benedict Realty Group, Coltown Properties, Icon, SMRC Management, Steve Croman and Ved Parkash. Various tenants from buildings owned by these landlords were at the event, including residents of 444 East 13th Street, who recently filed a lawsuit against their new management company with the help of the Urban Justice Center because they have no gas or hot water and the management company has been doing construction despite a stop work order from the Department of Buildings.
Congresswoman Carolyn Maloney, at a May, 2010 press conference in front of Stuyvesant Town, discusses her Fannie Mae/Freddie Mac legislation. (Photo by Sabina Mollot)
By Sabina Mollot
Two weeks before the scheduled foreclosure sale of Stuyvesant Town’s debt, Congresswoman Carolyn Maloney reintroduced legislation that would prevent Fannie Mae and Freddie Mac from investing in future, similar housing deals that lead to the loss of affordable housing rather than the creation of it.
However, she freely admitted that the bill is not likely to get passed any time soon.
“It is very difficult to get a bill through Congress, but I am continuing to build support behind this important bill,” said Maloney, “and I am looking for opportunities to incorporate the reforms it proposes in other legislation.”
The bill was first introduced in 2010 after Fannie and Freddie got affordable housing goals credits for their participation in the Tishman Speyer purchase of Stuyvesant Town.
Maloney reintroduced the bill on Friday, May 30, following the formation of a coalition of over 40 local elected officials aimed at fighting predatory equity. The Coalition Against Predatory Equity (CAPE) was formed by Council Members Dan Garodnick, Jumaane Williams and Ritchie Torres and one of its goals is to ensure responsible lending by Fannie Mae and Freddie Mac.
Both agencies are mandated by the federal government to help increase affordable housing. However, Fannie and Freddie were parties to the Stuy Town deal in 2006, despite the owners’ business plan of ousting stabilized renters and replacing them with market rate paying ones.
Specifically, the agencies invested in a $22 billion commercial mortgage-backed securities transaction that contained the senior debt on the ST/PCV. Fannie Mae and Freddie Mac’s participation as senior debt holders of $3 billion was critical, as it represented nearly 60 percent of the total cost of the acquisition.
Maloney’s bill, if passed, would prevent Fannie, Freddie or any other government sponsored enterprise (GSE) from receiving affordable housing goals credits when a project’s debt is disproportionate to its income like the ST/PCV venture.
The bill would also require the GSEs to use the same standards for assessing their investments in the secondary securities market as they would for direct investments for the purposes of affordable housing goals credits.
“Part of Fannie and Freddie’s mission is to encourage affordable housing, but some of the deals in which they have invested have caused the opposite to occur,” said Maloney in an official statement. “Affordable housing credits shouldn’t be awarded for investments when the only conceivable scenario for profitability is for rents to rise. That is what’s happening at Stuyvesant Town/Peter Cooper Village, and that’s what my legislation is designed to prevent.”
A spokesperson for Fannie did not respond to a request for comment. A spokesperson for Freddie said he couldn’t comment on legislation affecting the agency.