An Introduction to New York City’s Slumlords

A few years ago, after a court ordered a landlord to renovate my clients’ building after a major fire, the landlord’s contractor scheduled a visit for our clients to tour the construction site. Once inside, the landlord locked us in the building, tried to have us arrested, threatened to have me disbarred, and had a major verbal meltdown on me over the phone.

After these sorts of incidents, I started to think about my cases less in terms of the legal issues and more in terms of the landlord psyche. Or put another way, I wondered: what forces are creating these monster landlords?

I’m lucky. My clients are almost always on the “right” side of the law. And, if I don’t make some idiotic technical error, they should win their cases.

Winning a repairs case in housing court doesn’t usually get tenants money; it’s simply about getting their building fixed or stopping behavior ranging from the bizarre to the diabolical.

That is all to say: If a group of tenants band together and voluntarily spend their days in the decrepitude of housing court, they usually have a good reason (for a description of housing court, take a peak at  “Welcome to Housing Court, Son”)

After much reflection, I’ve created the following three rough categories (acknowledging we have many hybrids out there).

And, of course, a caveat: I know New York City has many wonderful, decent landlords who care about their tenants. I just don’t get to meet them:

The categories:

Type #1: The Neglecter

Type #2: The Eccentric

Type #3: The Sadist

To elaborate a bit on the categories, I’ve provided a brief explanation of each:

Type #1 (The Neglecter): So long as there exists affordable(ish) housing, New York City will always have painfully cheap, absentee landlords. They summer in the Hamptons, winter in Florida, and drive by the property in their Beamer once every few months to make sure the place hasn’t burned down (yet).  The landlord probably has a fancy insurance policy in the case of “accidental” fire, anyway. If the landlord somehow must remediate the mold covering a wall, he’ll send in the super with some white paint, a bucket of bleach, and hope for the best.

Type #2: (The Eccentric): Now on the verge of extinction, The Eccentric is the New York City landlord of legend. This landlord visits frequently (or even lives in the building) and definitely has small office on the ground floor filled with moldy rent ledgers dating back to 1950, a type writer, and a giant printing calculator for “accounting” purposes.

The Eccentric might knock on your door at 2am, wondering if you’d be so kind as to wait in a highly-coveted parking spot in front of the building while he pulls his old clucky Buick around.

Or maybe he’s got a mole on his back and wants your assistance in determining if it’s worth getting checked out. Would you mind just pulling at it see if it’ll come off with a little force? He hasn’t raised your rent in a few years so, sure, you’ll give it a good firm tug.

The state of the building? Ehh, not great.  But hey, the rent is cheap, you know all your neighbors, and you can’t beat the location. You’ll put up with some peeling paint and windows that don’t actually open (the summer is really only two months, anyway).

Of course, The Eccentric gets less endearing as his behaviors slips from strange to dangerous. I’ve seen once-eccentric landlords begin to spout racial epithets in the hallways, threaten to kidnap children, and lock tenants in the basement.

All across the world (but perhaps particularly in New York City), people are or become mentally ill.  It’s a fact a life. The Eccentric might suffer from delusions, Alzheimer’s, or have a brain tumor the size of a grapefruit resting on his frontal lobe. But when eccentricity turns to illness, and someone owns property with people living in it, things get real.

A trial trying to prove The Eccentric has gone rogue usually involves introducing videos of the landlord beating tenants with anything from a file folder to a stick, nighttime rants, hand scribbled eviction notices, homophobic graffiti, disabled electrical systems, and vandalized boilers.

Despite the dark hilarity of the trial and the tenants’ strong legal case, these cases are bummers all around. The Court System is not equipped to deal with mental illness on the landlord or the tenant side, and watching a once-eccentric but beloved landlord get gobbled up by the Adult Protective Services system isn’t fun for anyone.

Type #3 (The Sadist): While I started my career against The Neglecters and the occasional Eccentric, more and more I’m finding Sadists sitting on other side of the table. Why more Sadists?

Most Sadists have taken a “pay-me-back-or-you’ll-wash-up-in-the-the East River” high-interest loan from a less-than-reputable and often unregulated source (like a private equity fund, small bank, or even an individual). To make good on the loan, The Sadist has the following unenviable tasks ahead:

  • Phase I (Month 1-4): Try to evict all the long-term tenants, usually low-income multigenerational families, the elderly, and folks who don’t speak English. The landlord can offer low buyout (i.e. “take $10,000 and go before it gets bad in here.”) Or combine these low buyout offers with a healthy side of imitation. Common tactics include hiring  “detectives”  or “investigators” to intimidate tenants regarding an ongoing “NYPD investigation of drug dealing on the premises.” What, you weren’t aware of your son’s heroin business?  If you’re a smart Sadist, around now is a good time to add leverage by frivolously suing all the tenants for eviction. In the most extreme cases, the landlord will claim the building is no longer re-regulated; he’s just going to ahead and demolish it—your choice if you want out before the demo team gets here

 

  • Phase 2 (Months 4-12): If there remain any holdouts after Phase 1, The Sadist will renovate the now-vacant units in a manner so disruptive, creative, and dangerous that anyone who refused to leave during Phase 1 is going to start to feel the burn (literally). Common tactics? Release some toxic lead dust while demolishing century old walls; remove an elevator from a building with lots of elderly or disabled tenants. Or hey, if all else fail, just rip out the staircase or take off the roof.

 

  • Phase 3 (Months 12-24): Once the vacant units are “renovated,” The Sadist must find a group of alcoholic, night-life loving undergraduates to rent the newly renovated apartments at market rate. What was once a large bedroom (rent $750/month) has now been partitioned dorm-style into three bedrooms and a living room (rent $4,500/month). There will be cigarettes, drugs, loud music, raging parties, and, if The Sadist gets lucky, disco lighting visible to the neighbors. Any elderly remaining tenants should take care to avoid the vomit coating the steps on Sunday morning.

To execute the above-referenced business plan, lenders actually require a Sadist. The kind of background check a bank would ordinarily perform on a prospective individual homeowner might actually work against a prospective Sadist landlord.

In search of the right landlord borrower, the lender needs someone with few moral scruples. Admittedly, I’ve never actually been present during the loan application process but I imagine the lender might start by asking about the prospective landlord’s childhood: Any history of torturing animals? And his adolescence: Any time in juvie? No? What about high school suspensions? And, of course, adulthood: Any felony convictions, violent, or otherwise? Really, not even an arrest or something white collar?

So how does this story end?

Tenants who make it through all three phases earn the title of “The Survivors” (at least in my head). Sure, The Survivors might have a newly-diagnosed case of asthma, a prescription for seven kinds of sleeping pills, and an even more cynical view of capitalism than before (if possible) but they still have their rent-regulated apartments.

And what about their Sadist landlord? He’s probably in the East River; the business plan was never going to work anyway even if he succeeded completely in Phase I.

The lender? The various lenders are battling for the property in court; the richest most evil one will soon prevail, and, as owner, will hire the most expensive law firm to  continue those pesky eviction cases.

And the Market Rate Tenants? The four-to-an apartment students are wondering why in the world they’re paying $5,000/month for an apartment without heat, hot water, or gas service.  But hey, it’s just for one more semester—a true New York City war story to tell their suburban-raised kids one day. Yup, daddy freakin’ roughed in the City.

 

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