TriBeCa tenants fighting 54% hike

NY Post, May 29, 1997

THE political has become the personal for lower Manhattan Councilwoman Kathryn Freed.

Freed is one of the most pro-tenant members of the council. She is also a resident of Independence Plaza, the 1,375-apartment middle-income housing development in TriBeCa.

The owners of the development have applied to the city to raise the rents an extraordinary 54 percent over the next two years.

Independence Plaza tenants aren't covered by the rent-control or rent-stabilization laws that are the focus of the battle in Albany.

But because the building's developers received federal subsidies and city tax abatements under the Mitchell-Lama program, any rent increase must be approved by the city's Department of Housing Preservation and Development.

Freed is fighting her landlords as a tenant and public official. This is not a conflict-of-interest to her -- it's a conflict for survival.

Facing loss of her $70,000-a-year council job in 2001 because of term limits, Freed says she might have to move out if the city approves anything more than a 5 percent rent hike.

Manhattan Plaza is owned by a limited partnership called Duane Street Associates. The wealthy rent-gougers behind the corporate veil are Harold and Julian Cohn.

"We have become the laboratory to test how much greed landlords can get away with," Freed was saying yesterday. "If they can raise our rents by 54 percent, that's what they will try to charge if vacancy decontrol is passed in Albany."

Freed, a lawyer, now pays $900 a month for a one-bedroom apartment.

"When I originally moved in, 25 years ago, I gave up a rent-stabilized apartment. I was lured here on the promise that the rents were subsidized by the federal government because we are a Mitchell-Lama project," she said.

"I was assured I would never have to pay more than 30 percent of my income in rent. But TriBeCa has become such a flourishing neighborhood that the landlords are trying to take advantage of this surrounding economic vitality."

Independence Plaza is one of the most successful middle-class projects in the city. It radiates a remarkable sense of community, an urban oasis of multiracial bonding.

The rent hike would drive lower-income and elderly tenants out. It would destroy the fragile and magical balance and chemistry that makes this place work.

My friend Jose Torres, the writer and former boxing champion, has lived in the 3,000-person complex for 21 years.

"My children's best friends were of every color on earth," he says. "Everybody smiles and says "good morning' in the elevator. If one family has a crisis, all the neighbors help."

When asked about the pending rent hike, Torres said, "The relationship between tenants and landlord here is becoming just like the exploitative relationship between fighters and promoters."

The legal briefs on file, and a public hearing held in January by the city's housing agency, make it apparent there is little excuse for such a drastic rent increase.

The landlords are making a nice profit. The federal subsidies and the rent roll are bigger than the operating expenses, including taxes and utilities.

The Cohn brothers also fired their managing agent and hired themselves in 1995 to manage the project for an annual fee of $654,000, according to HPD records.

At the January hearing, the owners argued the rent hike was necessary for pay for $7.4 million in capital improvements.

But the testimony of engineers and accountants hired by the tenants effectively refuted the need for any new capital investment.

You had the unusual sight of tenants testifying that the infrastructure is in good shape. They said the elevators and fire-alarm system are in excellent condition.

The Cohn brothers said they need $1,250,000 to replace all the windows and terrace doors.

Joel Teicher, the tenants' engineer, testified that the windows didn't need to be replaced and were actually superior to the type of windows proposed by management

Fictitious needs seem to be the rationale for the increase.

Harold Donohue, who teaches at Medgar Evers College, is the president of the tenants association.

"Most tenants here can't afford this increase," he said."Most of us can't even afford to eat in the trendy TriBeCa restaurants we read about in the gossip columns.

"TriBeCa has become identified with Robert De Niro and JFK Jr. But most of our tenants are barely middle class."

When Freed testified in January, she said:

"It would be an injustice if families were forced to move out because they are unable to pay higher rents resulting from unwanted improvements which they will never get the opportunity to use."

Three weeks ago, Freed met with the new HPD commissioner, Richard Roberts, who will be the final decision-maker on the rent application.

"He was sympathetic, but he's new," Freed reported. "He's not up to speed on all the details yet. I hope he makes a decision before the election."

Freed is a loyal Democrat, but she objectively estimates that "almost half" of the Independence Plaza residents would vote for Mayor Giuliani today.

"But that would change," she quickly added, "if the increase is more than 5 percent, or if it is stalled until after the election.

"Nobody knows who the HPD commissioner is," Freed said. "But everybody knows he works for Giuliani."

Copyright ©1997, N.Y.P. Holdings Inc.