Sara Cullinane lives in a five-building complex on Park Place in Crown Heights, just off a strip of Franklin Avenue that has transformed dramatically over the past few years. Nearby, pricey restaurants, oyster happy hours, charcuterie, and vintage furniture are increasingly dominating the terrain, though a few bodegas (the kind without organic produce), members-only clubs, and grungy looking Chinese take-out spots remain.
Cullinane’s building, the Brooklyn Jewish Hospital Complex, where she has lived for seven years, is owned by the Alma Realty Corporation, which divided the former hospital into 700 residential units back in 2005. Nearly all of the units are rent stabilized. According to Cullinane, one-bedrooms in the building go for approximately $900-$1000per month, two bedrooms for $1300-$1500, and three bedrooms cost around $2400.
The apartments are well below market rate for most of Brooklyn, including Crown Heights, as average rent prices in the area have shot up precipitously in the past few years. From 2013 to August 2014, rents increased by 17.5 percent, according to MNS Real Estate. As of October 2014, the average rental price for a one-bedroom in Crown Heights is $1,926.
In August, residents of the complex, which Cullinane described as a very diverse set of “early gentrifiers, for lack of a better term”– school teachers, artists, people who work at non-profits–began receiving letters notifying them that their apartments were no longer rent regulated. “People who have leases that are up for renewal are seeing market rate prices, and some people are seeing increases of up to 20 precent– so there are some pretty significant increases,” Cullinane explained.
But landlords can’t deregulate apartments on a whim. Though it’s becoming easier for this type of affordable housing to disappear, the NYC Rent Guidelines Board only allows deregulation in the case that an apartment is vacated and the new tenant is willing to pay $2,500 or more for rent or when a tenant’s total annual income increases to more than $200,0000 for two years straight.
But Alma Realty informed their tenants at the hospital complex that they never should have had rent regulated apartments in the first place. “We were perplexed,” said Cullinane, who is a member of the building’s tenant association.
The members got together and figured out that the building, which was supposedly rent regulated in exchange for a J-51 tax break from the state, had actually never officially qualified for the tax breaks. “Alma filled out the application for J-51, but they never finished it,” Cullinane explained.
“And then just as our neighborhood is becoming another majorly gentrified hot spot of Brooklyn, there’s a new building that went up first with two-bedrooms going for $3800 and a Starbucks in the basement. The neighborhood changed, and at this moment Alma decided to announce they never received the J-51 tax abatement. “So that meant it wasn’t approved, but oddly [Alma] gave us all rent stabilized leases anyway. The city registered all of our apartments as stabilized, and then we got stabilization renewals for years and years.”
At first glance, this seems like a massive oversight. But Cullinane and the other tenant association organizers suspect there’s more to the story. “When I moved in there were a lot of empty units,” she said. “It kind of felt like we were all induced into renting what we thought were rent stabilized units, and as soon as the market changed, so did the leases. ”
The tenants association has fought with Alma in hopes of convincing the realty company to go back on their plans for deregulation. Yesterday, residents of the building and their supporters were supposed to carry out a rally at Alma’s headquarters in Astoria. Emails were sent out and the location was confirmed just hours before the protest, but at the last minute, Cullinane said, the rally was cancelled. “Alma has started to negotiate with us, which is good news,” she said.
In an unexpected turnaround, things are looking up for the tenants of the hospital complex. So how did they get the realty company to consider acquiescing to their demands?
“We’ve worked very closely with our elected officials to basically put pressure on Alma to restabilize our units,” Cullinane explained. The tenants have gained the support of Laurie Cumbo, their city council representative, as well as that of their State Assembly representative, Walter Mosley. The tenants most active in the association have rallied relentless around the issue, knocking on doors throughout the massive complex, posting flyers, making phone calls, organizing public actions, and making “hundreds of phone calls to the Mayor’s office,” demanding that he meet with them. They even gathered 1400 signatures for the petition presented to Alma Realty yesterday.
One factor that probably holds a great deal of sway is that Alma is also the company behind Astoria Cove, the massive development planned for Queens (that just so happens to be seriously lacing in affordable housing), and is leaning heavily on the city’s approval to proceed.
“All I can say now, is that we’re in the early phases of negotiating a deal,” Cullinane said.