“Now the property will start to get interesting again.”

So says Steve Kuritz, an analyst of mortgage-backed securities for Morningstar Credit Ratings, according to an online New York Post article on PCVST.

The gist is that the property has now been valued by an "independent appraiser" for CWCapital at 3.2 billion, which is closing in on the $3.4 billion necessary for the bondholders to break even on their investment.

The article continues: "Kuritz pointed to an uptick in cash flow from the rentals, which he estimates has risen to $167 million this year from $129 million in 2009."

Also: "The owners will have no shortage of bidders, based on the many suitors who have been salivating over the property for years."

Interestingly, one possible suitor, billionaire investor Wilbur Ross, states: “I would have no interest in it if it is simply an expensive ticket to internecine warfare among the tenants."

Don't expect a quick deal, though.  A lawyer for CWCapital sees a "final resolution" occurring in 2014.

Merry Christmas and Happy Holidays to All!

Stuy Town's Impressive Christmas Tree

The current Stuy Town Christmas tree, off to the side of the Oval:

The Stuy Town Christmas Tree tradition from a couple of years ago, at the center of the Oval lawn:

 

Times are indeed hard, priorities must be set.  Money to spend on an Ice Rink and Oval "events," but no money for a decent Christmas Tree.

A Vote of No Confidence for Garodnick

I wanted to get to this news item earlier in the week, but better late than never.

So our councilman, Dan Garodnick, who opposed extending term limits past two, is now running for a third term as city councilman.  I'm somewhat conflicted here, as I generally feel that term limits are unconstitutional and haven't voted for them, but the people of New York City spoke, twice, about terms limits (actually, once more recently), and the vote of the people was to limit term limits for city office holders to two.  Naturally, Mayor-for-Life Bloomberg, in a self-serving maneuver, turned this around with approval of most of the City Council. Garodnick was one of the nay votes on the Council against Bloomberg.

So what does Gardonick do when his own job is at stake, after serving two term limits and withdrawing from the comptroller race because he'd probably lose against his "friend" Scott Stringer?  He goes for a third term as city councilman!

Not only that, but with a "war-chest" of 1.5 million dollars, collected for his future plans in politics, he holds a fund raising event to get more money into his coffers.  Does anyone serious think that Garodnick will face a credible challenge that will necessitate over a million dollars, possibly two million, to win, again, his city councilman seat?

Politics as usual.  And it sucks.

As for Garodnick himself, and his effectiveness as a politician, in particular his effectiveness in dealing with PCVST....

Yeah, he's a nice guy and lives in Peter Cooper Village and responds to tenants concerns and it's good to have a resident of our community representing the community as a city councilman.  That said, Garodnick has been lame on certain issues here, after making forceful statements about his concerns and about what should or should not be happening in Stuy Town and Peter Cooper Village.  He clearly expressed his doubts about the Stuy Town ice rink, worried about the implication of a commercial enterprise in a previously free playground space, and he was just as clear, and initially proactive, in his determination to work with management in moving the Stuy Town greenmarket to a properly zoned area in or near the complex.  He dropped the ball on both matters, paving the way for Oval Cafe and lord knows what other commercial enterprise CWCapital and Lady Maya are concocting for the future. It's not pertinent to the condemnation that a portion of residents may favor an ice rink, greenmarket or cafe, but it is pertinent to point out that Garodnick did not follow through on these matters which he initially tackled with sensible commentary.  Worse, he surrendered.

Then, there's the matter of tenant ownership of PCVST.  Much energy, and the hopes and dreams of some tenants, have been focused on this, with Garodnick (along with the TA) at the forefront, leading the charge.  I think this a fool's chase, but that's only an opinion.  What I don't think is opinion is that affordable housing for the middle class is disappearing month by month here, and that Garodnick and the City Council and the Mayor have done nothing to stop this steady decrease in the housing opportunities for the middle class.

There are other negatives in Garodnick's file.  His advocacy for the 2nd Ave subway, which has decimated businesses and the living standards of those along the construction route; his vote to allow, despite zoning regulations, a huge skyscraper at 7th Ave & 33rd Street that will block out the icon view of the Empire State Building from several points and create more massive congestion in midtown; his acceptance of large amounts of political donations from real estate concerns (including, it must be noted, the real estate entity involved in that 7th Ave skyscraper)....

Yeah, he's a nice guy and all that, but I have no confidence in Dan Garodnick.  We will continue to go down the hole here in the city, paving the way more and more for the wealthy to live here, while we will be forced to move to the outskirts, coming in daily and leaving daily, to serve those who are the real masters.

Yup, You May Be Worse Off After Roberts

From Crain's:

Stuy Town deal may have sting in store for some

Some residents of the sprawling apartment complex could face substantial rent hikes as a result of Thursday's tentative deal

For residents of Manhattan's sprawling Stuyvesant Town/Peter Cooper Village residential complex the settlement announced late Thursday could have a painful reprocussion. The deal awarded tenants $147 million for rent overcharges, reimbursements and discounts in prior years, but going forward it could push rents substantially.

According to CWCapital, the company that represents the bondholders for the complex's $3 billion mortgage, about 1,800 apartments at the 11,000-unit complex face a choice of two rent options: a market rate, or one calculated based on how many times the apartment was vacated and what increases it is due according to city regulations.

In a surprise contradiction to the widespread belief that rent regulations create discounted apartments, the market rate is in the fact often the cheaper option, according to CWCapital.

 [....]

"I am concerned about people who had an expectation that their rent had settled at a certain place and may be wholly unprepared for the increases this agreement allows," said Daniel Garodnick, a City Councilman who lives in Stuy Town and has been a tenant advocate.

When a rent-regulated apartment is vacated, it allows rents to be substantially increased, by as much as 20%. The settlement deal allows as many as three such increases dating back to 2003, when apartments first were illegally deregulated at the large complex.

"Let's say that the tenant previous to the market rate occupant paid $1,200 a month," attorney Alexander Schmidt, who represented the tenants in the settlement said. "You could have easily seen three turnovers with the amount of students that live in the complex and rents that now end up in the high $2,000s or low $3,000s, which is market rate or not much lower."

Mr. Schmidt called it an "ironic" end to a case that was largely looked at as a battle for preserving affordability in the city for working class tenants.

Read more: http://www.crainsnewyork.com/article/20121130/REAL_ESTATE/121139990#ixzz2DkC798nf

-------------------------------------

Now, here is were I tire of this bullshit game:

HOW IS IT THAT OUR POLITICIANS HAVE ALLOWED A RENT REGULATED APARTMENT TO BE SO SLIMELY BROUGHT TO HIGH MARKET LEVEL RATES WITH THE PURPOSEFUL INTRODUCTION BY THE LANDLORD OF A TEMPORARY TENANT, ie, THE STUDENT?

And....

HOW IS IT THAT THERE IS NO ENFORCEMENT IN THIS COMPLEX OF THE HOUSING LAW THAT STATES THAT NO MORE THAN 3 UNRELATED PEOPLE CAN OCCUPY AN APARTMENT?

And....

HOW IS IT THAT PARTITIONS AND WALLS CAN BE INSTALLED INTO APARTMENTS TO INCREASE THEIR VACANCY, BUT THAT THOSE APARTMENT BUILDING CODE APPLICATIONS STATE THAT THERE IS NO CHANGE IN OCCUPANCY?

In other words....

WHAT THE FUCK IS GOING ON HERE???

Explanations, please.

Meanwhile, the lawyers on this deal will be receiving over 25% of the settlement, ie, about 19 million dollars, if not more:

http://www.nytimes.com/2012/11/30/nyregion/68-7-million-settlement-on-stuyvesant-town-rents.html

Settlement Agreement Reached in Roberts Case

So will previous market rate tenants get screwed? Benefit? And how much have the lawyers received? The best place to find answers, if any at this early point, is on the TA Facebook page. The discussions there will be pertinent to people's concerns.

http://www.facebook.com/groups/stpcvta/permalink/10151313172971690/

This link will also be of considerable interest:

http://www.berdonclaims.com/cases/Details.aspx?cid=243#tb_main

Below is the news:

Stuyvesant Town Class Action Parties Reach Settlement –
Agreement Signed Today Provides $68.75 Million to Pay Damages;
Total Tenants’ Rent Recovery to Exceed $146.85 Million

November 29, 2012 – Wolf Haldenstein Adler Freeman & Herz LLP and Bernstein Liebhard LLP, co-lead counsel for the plaintiff tenants in the Roberts v. Tishman Speyer class action, announced they have signed an agreement with the defendants to settle all past rent overcharge claims and future rent claims raised in the action. The settlement was preliminarily approved today by Justice Richard B. Lowe, III, the Chief Justice of the Appellate Term, First Department. The agreement requires final court approval. A hearing on final approval is scheduled for April 9, 2013.

The settlement agreement signed today sets aside $68.75 million to compensate class members for rent overcharges from January 22, 2003, the start of the class period, through December 31, 2011, the end of the overcharge period.

“Once finally approved, today’s $68.75 million settlement agreement, when combined with past refunds and rent savings the tenants have already received, will bring the total recovery in the lawsuit to at least $146.85 million,” said Alexander Schmidt of Wolf Haldenstein, the plaintiffs’ lead attorney. “There will also be future benefits,” he added.

The past rent savings and refunds resulted from an interim agreement that was reached in the case in December 2009 between the plaintiffs and the two limited partnerships that currently own Stuyvesant Town and Peter Cooper Village, PCV ST Owner LP and ST Owner LP. Under that interim agreement $2.4 million in rent was refunded to class member tenants in 2010, and the tenants saved an additional $75.7 million in rent over the past three years, Schmidt said. Ronald Aranoff of Bernstein Liebhard, another of the plaintiffs’ lead attorneys added “we believe this settlement provides an extraordinary recovery for our clients and we couldn’t be happier for them.”

Schmidt noted that the $146.85 million amount could significantly increase in the future because the settlement sets future rents based on a “Preferential Rent” formula that will save tenants at least another ten to twenty million dollars, and potentially more than a hundred million, over the next eight years. The exact amount of future rent savings under the formula will depend on future rental market conditions and tenant turnover rates, Schmidt added.

The settlement also continues rent stabilization through June 2020 for each of the 4,311 formerly decontrolled Stuyvesant Town and Peter Cooper Village apartments at issue in the suit. June 2020 is when the residential complexes’ New York City “J-51” tax benefits expire. The New York Court of Appeals, the state’s highest court, found in October 2009 that the apartments had been removed improperly from rent stabilization while the complexes were receiving those tax benefits, which are available only for rent stabilized buildings.

The current owners of the complexes contributed $58.25 million of the $68.75 million cash component provided by today’s agreement. Metropolitan Tower Life Insurance Company, the owner until mid-November 2006, contributed $10.5 million.

The settlement concludes almost 18 months of negotiations. Aranoff said that today’s $68.75 million settlement includes a generous legal rent formula for the past rent overcharge claims, which yields damages of almost $10,000 per leasehold and average damage awards of $3,200 for the 21,250 class members.

Because the legal rent formula under the interim agreement was even more generous, Schmidt said, the rents going forward may be adjusted upwards by the landlord after the settlement is finally approved, subject to the Preferential Rent formula caps.

The cash received and saved will not be the only benefits the class members achieve as a result of this litigation, Schmidt said. “Class members will realize substantial additional benefits by retaining the full protections of the Rent Stabilization Law for the next eight years, including, most importantly, the rights to automatic lease renewal and succession. The settlement is eminently fair and reasonable, and a very good result for the tenants.”

The settlement agreement and other pertinent information about the settlement and the litigation are available atwww.berdonclaims.com (click “Cases: Current and Completed,” narrow your search to “New Cases” and click “Stuyvesant Town Class Action”).


Media Contact for Wolf Haldenstein Adler Freeman & Herz:
Lisa King Ned Steele
lisak@mediaimpact.biz neds@mediaimpact.biz
(m) 646-234-5080 (m) 646-234-5070
(o) 212-590-2313 (o) 212-590-2313

Storage Waiver Issue

Before we get to the main topic, I'd like to say that I've been extremely busy and have only been able to quickly post updates on the Hurricane Sandy situation and its aftermath, as well as let through some (but not all) comments made on the blog.  I really don't have the time or the energy or even the spirit these days to proceed with the blog as I'd like and certainly not to argue with some commentators.  This is a New York City blog, and being NYC it can get earthy and a bit out of control.  I'm not from the MidWest or some gentle New England town, and I don't have those sensibilities, and I'm certainly not PC.  One of my reasons for posting that Jackie Mason clip was to weed out non-New Yorkers who take offense at most anything.  A real New Yorker would, or should, enjoy it.

I've been wanting to post an assessment of the Hurricane Sandy situation, but, again, don't have much time to go into it fully. My summary is that this time around, unlike with Hurricane Irene and the previous management, the new management did keep residents up to date with continual e-mails and flyers in buildings and under the door. So that was a clear, even surprising, positive.  (Note: the intercoms were not used, however, despite tenants being charged for such a use as an MCI.)  I also want to thank and applaud the people--tenants, the TA and management--who proactively went out through the buildings to check on residents who may have been trapped in their apartments without heat, electricity and elevator access.  Take a bow, everyone, you did a grand job. Management did also a fine job in setting up quarters in a couple of the Oval "Essentials" when its own office was flooded.  I also saw the man himself, PCVST manager Sean Sullivan, walking around the complex, at work, on Veteran's Day (the actual day on Sunday) when he could have been celebrating the day as a former military man.

I'm sure there were failings.  The biggest seemed to be flooded garages and storage areas.

As for the Ice Rink....  Well, it's like the Bridge on the River Kwai, isn't it?  It has to be kept alive no matter what.  (Please, no jokey comments about blowing the rink up as the Kwai bridge was blown up. I will not let them through.)  And, yes, I know the spin that non-PCVST workers are involved in maintaining and running the rink, but PCVST resources are still be used.  At least those residents and their guests who don't give a damn about anything but the Ice Rink now have to suffer with the jacking up of fees to use the rink and rent skates, a price increase they are already bitching about. Tough, because once you accepted a commercial enterprise inside Stuy Town in a previously free playground space, you accepted whatever fees the powers that be charge.  But, yes, I do think it's great for the kids.

Anyway, there's much more to say, but little time to say it in. Now to the storage waiver issue....

*  *  *

Well, it seems that people are not being let into their storage areas in PCVST that were flooded and that now to get in you have to sign a waiver which absolves PCV ST Owner LP, ST Owner LP, CompassRock Real Estate LLC, NTT Storage LLC, Interstate Restoration, Inc. and Maxons Restorations Inc. from any legal claims you may make for your destroyed property.  What balls!

Anyway, here's the response from John Marsh, president of the Tenants Association, and below that the full waiver.

Counsel to Tenants Association has reviewed the Storage Waiver required to access flooded storage units. Counsel has advised the TA's Legal Committee, he would NOT sign such a waiver.

Now the conundrum, if you don't sign, they don't give you access to your property.

Below is the text of the Waiver. Any lawyers out there who would like to comment on this waiver?

I , ( t h e " R e l e a s o r " ) , r e s i d i n g a t have requested to enter the basement of __. , New York, New York (the "Basement") for the sole purpose of retrieving my belongings and for no other purpose. I acknowledge the risk and understand that the Basement that I will be entering was flooded from the East River as a result of Hurricane Sandy. I further acknowledge that I have received a copy of relevant pages from "New York State Department of Health Disaster Recovery Information" guide. If I choose, I can review the complete document at the New York State Department of Health's website. I further acknowledge that the Basement I will be entering is a work zone which may have damp or wet surfaces, debris and other materials that may be difficult to see. Understanding this, I am entering the Basement under my, own free will and accept all risks associated with entering the Basement.

I understand that the Releasees (as defined below) would not permit my access to the Basement except upon my providing this waiver of liability and the acknowledgments and agreements contained herein.

I hereby release and forever discharge and waive any claims or rights against PCV ST Owner LP, ST Owner LP, CompassRock Real Estate LLC, NTT Storage LLC, Interstate Restoration, Inc. and Maxons Restorations Inc. and their respective predecessors, heirs, executors, administrators, successors, assigns, subsidiaries, parents, officers, shareholders, directors, board members, employees and agents (collectively the "Releasees") from all manner of actions, causes of action, suits, damages, indemnifications,
contributions and claims whatsoever, including costs, expenses, penalties and attorney's fees, which I or any person(s) under my control over has or which my successors or assigns can, shall or may have, directly or indirectly, whether known or unknown, for, upon or by reason of any matter cause or thing whatsoever relating to or arising out of my access to the Basement including, but not limited to, any actual or alleged injuries to (i) me or any person(s) under my control caused by or resulting from entering
and being in the Basement; and (ii) any personal property located in the Basement.

Furthermore, I acknowledge that after November 30, 2012, any personal property that I leave in the Basement will be discarded. In the event I leave personal property in the Basement after November 30, 2012,1 shall have no claim against Releasees relating to such property.

This WAIVER, RELEASE AND ACKNOWLEDGEMENT may not be modified or terminated orally.

In Witness Whereof, the Releasor has caused this document to be executed on the date set forth below.

Releasor:

S i g n a t u r e
D a t e
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The Difference Between Jews and Gentiles in a Restaurant

To lighten up the mood: