Remember when Zohran Mamdani claimed that if rent-stabilized landlords were truly suffering, more would apply for New York’s hardship program?
I think even Mamdani would acknowledge that far more than three experienced hardship last year. Yes, three. That is the number of applications the state’s hardship program received, a spokesperson for the state Division of Homes and Community Renewal told The Real Deal.
Clearly, the reason is the terrible design and inadequacy of the hardship program, not a lack of hardship. Landlords have learned not to waste their time applying.
With one exception.
All three attempts in 2024 might have come from the same person, who shared his experience with TRD but requested anonymity so as not to antagonize HCR. The owner and resident of a four-unit Manhattan building with two regulated apartments applied repeatedly as the state kept rejecting him for picayune reasons, like submitting one form in duplicate instead of in triplicate, or moving his building into an LLC.
This effort reminded me of the scene at the end of the film “Tin Cup” when Roy McAvoy, the fictional golfer played by Kevin Costner, continuously hits the ball into the water hazard in an attempt to make a miraculous shot on the tournament’s final hole.
After one or two attempts, McAvoy’s chance to win the tournament was gone, but he kept trying the shot rather than taking a penalty stroke and finishing the course.
Similarly, all the landlord stands to gain is a 6 percent increase in the rent for the two rent-stabilized units. That would not stem his annual loss on the building by much.
But like McAvoy, the landlord is trying to prove a point — that it can be done.
To that end, the landlord applied again early this year. About six months later, he received another paperwork request. “We were asked to notify our tenants and to provide them with copies of all the records that were part of our hardship application,” he said.
Tenants had 20 days to object. None did.
“I seem to be the first person to get this far in a very long time,” the owner said.
The finish line remains elusive. This week, HCR sent another laundry list of information requests.
The odds of success on any one attempt at this hardship program are about as slim as the fictional golfer’s: Every decision by HCR since 2022 has been a rejection. But like Tin Cup’s McAvoy, he keeps trying.
If the landlord succeeds in his Sisyphian attempt, he may experience the sense of redemption that Costner’s character did when he struck his last remaining ball and watched it soar over the water, land gently on the green, roll tantalizingly toward the cup and, impossibly, drop in.
What we’re thinking about: Rents have risen by a higher percentage in low-income neighborhoods than in the nation as a whole, unless those neighborhoods have recently added large amounts of housing. In those areas, rents have fallen the most.
“When not enough homes are built in high-income neighborhoods, people who would have lived [there] can usually afford to move into middle-income neighborhoods, and middle-income residents can usually afford to move into low-income neighborhoods, but residents of low-income neighborhoods have nowhere to turn,” a Pew study explained. “The data indicates that they keep their housing by absorbing large rent increases.”
It concluded that “not allowing more homes to be built — even for high-income residents — pushes up all rents, making it harder for low-income tenants to remain in their neighborhoods.”
Send your thoughts to eengquist@therealdeal.com.
A thing we’ve learned: The Fallon Company, a Boston-based developer with a $6 billion project pipeline, has a program in real estate finance and entrepreneurship for high school and college students. CEO Michael Fallon said, “We’re starting with how to give a handshake.”
Elsewhere…
— The city’s Campaign Finance Board denied Mayor Eric Adams’ campaign public matching funds for the 11th time, amNY reported. The board cited the same grounds as before, saying it did not receive necessary information in a timely manner and had “reason to believe the campaign violated the law.” Meanwhile, it awarded Zohran Mamdani $1,927,901, Curtis Sliwa $1,388,807 and Andrew Cuomo $482,000.
— A new report from Gothamist examines the hundreds of proposals that Mamdani has sponsored in the Assembly, where he has passed four bills. This year, he was the lead sponsor of 21 bills and co-sponsor of 242. Aside from the expected (tax the rich, free buses, increasing minimum wage), they include proposals for a 50 percent rebate on “safe” e-bikes, banning legacy admissions at New York colleges and universities and decriminalizing prostitution. Also, he sought to protect wolves.
— Williams Company, after multiple rejections, resubmitted nearly identical applications to fast-track a natural gas pipeline off the Rockaways. This time it’s banking on help from President Donald Trump to nab approvals, according to City Limits. The project faces fierce opposition from New Yorkers who say it threatens marine ecosystems, violates the state’s climate goals and will raise gas bills.
— Quinn Waller
Closing time
Residential: The top residential deal recorded Wednesday was $14.7 million for a 3,576-square-foot condominium unit at 432 Park Avenue in Midtown East. Corcoran’s Carrie C. Chiang and Andres Perea-Garzon had the listing. The seller purchased the property for $16.37 million in 2016.
Commercial: The top commercial deal recorded was $62 million for 300 West 43rd Street and 303 West 42nd Street in Times Square. The Real Deal reported on Xin Capital’s acquisition loan last week.
New to the Market: The highest price for a residential property hitting the market was $87.5 million for a 6,000-square-foot condominium unit at 220 Central Park South. The property last sold for $52.2 million in 2020. Adam Modlin has the listing.
Breaking Ground: The largest new building project filed was for a proposed 69,582-square-foot, 38-unit, 10-story residential project at 703 Myrtle Avenue in Bedford-Stuyvesant. Alexander Zabasajja filed the permit on behalf of Blue Shine Builders.
— Matthew Elo
