NYC Planning Commission Pushing For More High Rises; Increase Density in Transit Rich Neighborhoods

The Real Estate Board of New York hosted their annual event honoring commercial property management achievements and pros. One of the speakers at the event was Marisa Lago who is the City Planning Commission. In her speech, she addressed what is ahead for the City with respect to housing and what the Commission has been prioritizing.

According to Lago, New York is has a population of 8.5 million people and 4.5 million jobs. She indicated that between 2010 and 2017, NYC added 600,000 jobs. With this boom in employment there are challenges that the Commission would like to address.

Her biggest concern is to build more affordable housing. In particular they are prioritizing "as of right" developments. As of right developments are ones that comply with all applicable zoning codes. They do not require special public hearings, permits, variances or discretionary action by the City Planning Commission or Board of Standards and Appeals. Lago stated
“Since 2010 over 80% of new housing in the city has been built as-of-right. Without this development about 300,000 New Yorkers, an entire city of Pittsburgh, wouldn’t have the homes that they live in today.”

The second priority would be to increase residential density in transit-rich neighborhoods. Lago states that the Commission has been encouraging mixed-used neighborhoods in a focused way for the past two decades.

According to Globest, Lago pointed out in 2017, only 18 buildings 40 stories or higher were constructed. They accounted for only 1% of new residential buildings completed. But they accounted for 22% of new housing units. Creating more high rises would certainly bring more affordable housing in transit rich areas.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

Violations of Loft Law Put Landlords In Jeopardy Throughout NYC

A new article by Real Estate Weekly highlights the jeopardy landlords are placed in by violating the Loft Laws.  As many as 339 buildings throughout the City are sanctioned as a result of the law and 264 buildings lack a Certificate of Occupancy meaning that tenants can withhold rent until the buildings are brought up to code.  This has led to many landlords not receiving rent for years resulting in bankruptcies, pre-emptive sales and buyouts by tenants.  It has also led to deteriorating conditions in the buildings due to revenue not being produced to fix repairs.

According to the article, the states interim multiple dwelling (IMD), has given tenants of illegally-converted lofts a tremendous amount of leverage over the process of getting the units compliant with the law.  Property owners have complained about renters not assisting with allowing access to the units for the necessary fixes.  Also tenants must agree to the improvements that must be made by the landlords.  Landlords have nine months to complete the first phase of compliance, which includes compiling reports about the present state of the building and how it will look once improvements are made.  Jason Frosch, a Loft Law specialist at the law firm Borah Goldstein says that a building owner on average will have a year to obtain a certificate of occupancy before tenants can go on perpetual rent strike. However, since most of them former factories and warehouses that’s nearly impossible to do. He states that “the requirements of the Loft Law are costly and time-consuming.  The law doesn’t acknowledge that reality and it requires owners to front those costs while allowing the tenants to deprive them of a revenue stream that is necessary to pay those costs by withholding rent. And it creates a perverse incentive for certain tenants to delay the process and obtain a windfall for doing so."

The IMD drafted in the 1980's was initially aimed warehouses in Soho, Chelsea and Tribeca.  The new updates to the IMD from 2010 also targets warehouses in what is deemed industrial sites located in Williamsburg, Dumbo, Bushwick, Bed-Stuy, Fort Greene, Park Slope and Long Island City.
Senator Martin Malavé Dilan, a Democrat from northern Brooklyn has introduced a bill allowing owners more time to make improvements before tenants could withhold rent. That bill was not voted for by the legislature and owners are hoping that they will open a special session to vote on it.  It is uncertain whether they would have the votes to have it pass at this time.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/violations-of-loft-law-put-landlords-in-jeopardy-throughout-nyc/

NYC Broker Confidence Declines Entering Into The Slower Fall Season

The Real Estate Board of New York (REBNY) published their broker confidence index for the 2nd quarter of the year and it shows a decline from first quarter results.  REBNY which surveys its residential and commercial brokerage division members to measure their confidence in the New York City real estate market publishes their results quarterly with the top index being a 10.  The index shows that broker confidence decreased in the second quarter of 2018 to 5.53 out of 10.  This is a decrease of 0.25 from the first quarter of 2018.  Residential broker confidence levels hit a record low of  of 4.63 in the second quarter of 2018.

The report indicates that the main factors for the decreasing optimism with broker circles are political uncertainty, the expectation of rising interest rates, how the tariffs will affect investments, concerns about the implications of tax reform.  John Banks, President of the REBNY states "As federal policies have taken effect, local real estate markets have been seeing their impact on buyer hesitancy and seller uncertainty.  Despite these conditions, New York City real estate brokers remain positive overall about the present situation and future real estate market."

Some brokers believe that pricing and the lack of housing remains a major concern in the residential market.  One broker states "The biggest issue is still pricing, but a close second place is condition of the apartment," said a residential broker. "Buyers are slower to purchase an apartment that needs a good deal of work."  All of these concerns are affecting future confidence in the market as well.  The Residential Broker Future Confidence Index  which is an outlook on the future market six months from the date the survey was completed hit a number of 4.46.  This is 1.18 decrease from the first quarter of 2018.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/nyc-broker-confidence-declines-entering-into-the-slower-fall-season/

NYC Landlords Win Major Case in State's Highest Court Over Rent-Regulation

In a historic decision that could have affected an estimated 150,000 apartments throughout the City, the Court of Appeals has held landlords did not have to re-regulate apartments in rent-stabilized buildings that were properly deregulated once the rent-stabilized renter moves out.

The initial case was brought two years ago in Altman v. 285 West Fourth LLC.  The case involves a lease that was $1829.49 at the time of the vacating of the rent-stabilized tenant.  The subtenant (Robert Altman) then signed a new lease with the landlord (S.W. Management Acquisitions) that exceeded the prior rent and included a 20 percent vacancy increase ($2,484 per month) which is allowed under the  Rent Regulation Reform Act of 1997.  The legal rent thereafter exceeded the threshold of $2,000 a month rent in order for the rental to be deregulated.  The 2015 case indicated that the 20 percent vacancy increase could not be included in meeting the threshold which Altman was awarded $165,363 in overcharged rent.  The court stated that the rent had to exceed the threshold when the tenant was living there.  The Court of Appeals overturned this decision and now indicates that apartment rents can be increased and deregulated based on legal rents (including the 20% vacancy increase) on when the tenants move out.  The legal threshold for deregulation currently is $2,733.

According to The Commerical Observer the affirmation of the lower court's decision "would have given as many as 150,000 renters a precedent to sue their landlords for illegally deregulating their apartments and potentially allow them to win hundreds of thousands in rent overcharge judgements."

Real Estate Board of New York (REBNY), which filed an affirmation in support of the landlords is in support of the decision.   REBNY president John Banks stated “The New York State Court of Appeals, the state’s highest court, has reaffirmed the long-standing legal practice and widely held understanding of the application of the Rent Stabilization Law’s vacancy decontrol provisions.  This means that the owners of thousands of rent-stabilized apartments which have been deregulated over the last two decades can rest assured that the rules were followed and these units can remain deregulated.”

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/nyc-landlords-win-major-case-in-states-highest-court-over-rent-regulation/

Queens County Is Seeing A Housing Boom Increasing Affordable Housing Options Throughout The Borough

The New York Post recently published an article highlighting something that many have known for years.  That is that Queens County has increased options of housing with new construction happening all throughout the borough.  The article indicates that middle class families are finding relief in Queens as rental prices have remained moderate due to increased apartment choices.  Queens has always been an affordable option in NYC as median rent is an estimated $600 less than other areas of the city.  The NYC Economic Development Corp. (NYCEDC) registered 2,847 new housing units in February, with 1,234 of those in Queens.  This is 43% of all housing units in the city and a 300% increase for the last 12 months preceding.

Long Island City has been the center of the housing boom for the borough, however other areas are seeing new developments as well.  According to construction data analyzed RentCafe in June 2017, Long Island City led the nation in most new apartments since 2010.  The neighborhood had 66% more apartments built than the 2nd placed locale.

Queens Chamber of Commerce President Thomas Grech said of housing starts “we’ve been waiting for someone to notice this for a while. Queens has become very popular, and it is a low-cost housing alternative for many in the city. We have, as we speak, between 20,000 and 40,000 housing units being built in a cluster in Long Island City as well as in certain parts of Jamaica, which is also an up-and-coming area.”

Most recently Curbed New York highlighted the development boom in and around Jamaica, Queens.  The 15 new projects is overall impressive and the centerpiece project is The Crossing at Jamaica Station.  The project will have 669 affordable housing units across two buildings adjacent to the Long Island Railroad Station hub.  Clearly these are major changes that will change the landscape of the borough for decades to come.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/queens-county-is-seeing-a-housing-boom-increasing-affordable-housing-options-throughout-the-borough/

NYC Has 7 Of The Top 20 Gentrified Zip Codes In The Nationwide Leading To Increased Home Value

A new study by Rentcafe found that NYC has 7 of the top 20 gentrified zip codes in the nation.  The study looked at the 2000 Census data as well as the 2016 American Community Survey to see changes taken place in over 11,000 zip codes throughout the nation.  According to Rentcafe they study looked to three important factors to determine where gentrification was taken place.  The factors was median home value, median household income and the population holding a bachelor's or higher degree.  From there, their analysis gave an average rank based on zip code.  In the NYC area, Brooklyn led the way with 5 of the top 20 zip codes leading in gentrification.  This was followed by Manhattan with two zip codes.

Along with gentrification comes increases in home values.  According to the study the average home value in 2016 in the top 20 most gentrified zip codes was $446,730 with an average increase of  224% since 2000.  All areas in the Brooklyn zip codes (11211- Williamsburg, 11222- Bushwick, 11216- Bed-Stuy, 11237- Bushwick and 11221-Bed-Stuy/Bushwick ) saw increase in home values above 100% since 2000.  The Manhattan zip codes (10039-Washington Heights and 10026-Harlem) both saw increases well above 200% during the period.  The most interesting zip code in Manhattan according to the survey was Roosevelt Island's 10044 which saw an astronomical increase.
According to the article

"New York City dominates the top of the list, with some dizzying figures. That the median home value in New York’s 10044 (Roosevelt Island) exploded, going from just over $48K to almost $655K is just one way to put it. Proportionally, it is an astonishing 1,258% expansion rate."

The study points out that there are drawbacks to the gentrification of neighborhoods.  As we have seen in many areas in New York City, the influx of new highly educated individuals leads to displacement of long time residents of the community.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/nyc-has-7-of-the-top-20-gentrified-zip-codes-in-the-nationwide-leading-to-increased-home-value/

Commercial Lease Assistance Program Announced By NYC Will Include An Average Of 40 Hours of Free Legal Services

The City of New York has announced a new program to assist small business owners with issues revolving around their tenancy. The Commercial Lease Assistance Program which will be under the guidance of the NYC Department of Small Business Services, will give small businesses an average of 40 hours of free legal services.  The city has stated that the services that will be covered will include issues revolving around "negotiating a lease, resolving landlord issues, responding to an eviction notice, breach of contract disputes, and lease renewal."  The announcement further explains that the program will not represent clients that end up in court although there is not have been a statement on whether the selected attorney can represent the business in an outside capacity.

The Commercial Lease Assistance Program will receive $2.4 million in funding from the City of New York.   Gregg Bishop, Commissioner of the NYC Department of Small Business Services says “Small businesses don’t have legal teams like the big guys do, but we are making it clear that the City stands in their corner.  Even basic legal help can be costly and out of reach for small business owners, but this free service will go a long way towards helping small business owners solve problems related to their lease.”  This is the second program that the City of New York under the de Blasio administration will be funding to assist tenants.  In July of 2017, the City Council passes legislation to allow low income tenants to have free legal representation if they are facing eviction.  The new program will have an income eligibility requirement as well.

According to the release, small business owners in need who cannot otherwise afford an attorney are eligible for this program. Examples of businesses that may be eligible:

• Are immigrant-, minority-, women-, or veteran-owned,
• Employ local low-income residents,
• Are located in a rezoned or high-poverty areas; Or
• Offer job training opportunities

Mayor de Blasio said in a statement “Small businesses are the economic heart and soul of this city and they deserve every opportunity to succeed.  The Commercial Lease Assistance Program will give small-business owners the help they need to resolve legal issues without driving them out of business.”   Gale A. Brewer, Manhattan Borough President expanded the need for this program for small businesses in saying "Small businesses are big contributors to our city, which is why it’s crucial that we provide support services to help them compete and thrive.  Legal assistance, especially lease assistance, will be a big help for storefronters and small business owners.”
To be eligible to participate, your business must:

1. Be a small business according to the US Small Business Services Administration (PDF);
2. Be located in New York City;
3. Not be a franchise establishment; and
4. Meet the income eligibility requirements of the legal service provider.

Businesses can visit nyc.gov/commlease or call 311 to determine their eligibility for the Commercial Lease Program.
Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/commercial-lease-assistance-program-announced-nyc-will-include-average-40-hours-free-legal-services/

City Council Passes Bill Providing Legal Representation to Tenants Facing Eviction

On July 20th, the New York City Council passed a bill that would require all tenants facing eviction to have legal representation.  The bill requires that the Civil Justice coordinator implement the bill within five years.  Low-income individuals with eviction cases in housing court would have full legal representation while all other tenants not qualified would receive brief legal assistance.  Low-income individuals are New Yorkers with incomes below 200 percent of the federal poverty line – or $49,200 annually for a family of four.

The program is expected to help more than 400,000 New Yorkers each year, according to a report by commissioned by the New York City Bar Association.  According to the City's Indpendent Budget Office the full cost of implementing the Right to Counsel is estimated to be $155 million.  The City believes it will save $320 million.  The savings would come from the reduction of costs associated with housing evicted individuals and preserving regulated apartments lost to evictions

Intro 214-B was sponsored by Council Members Mark Levine and Vanessa Gibson.  Mr. Levine stated “Too many of the most vulnerable New Yorkers face eviction simply because they don’t have the means to hire an attorney. Today, the passage of this bill marks the beginning of a new era for tenants in New York City. New Yorkers have a right to affordable housing and to a fair justice system. No longer will low-income tenants have to fend for themselves in Housing Court. This new law is an historic step forward in the fight against unlawful evictions. I am honored to stand alongside my colleagues as New York becomes the first city in the country to guarantee legal representation for low-income tenants in Housing Court, and I look forward to working with elected officials across the country to draft similar legislation.”  The City Council states that as of 2013 landlords were represented 99% of the time in court while tenants were represented only 1%.  By 2015 tenant representation was up to 20% according to Mr. Levine while having legal representation reduces the chances of eviction by 77%.

 Co-sponsor of the bill Vanessa Gibson stated “This is a monumental day for tenants and a historic day for the City of New York. After four years of advocating, rallying, and marching, we can finally celebrate the passage of ground breaking legislation that will curb the homelessness epidemic and end the cycle of eviction plaguing New York City. With a right to counsel in place, tenants facing eviction will finally be on an even playing field with the landlords taking them to court. I am proud to have spent four years fighting for this critically important legislation and am so thankful to the many elected officials, advocates, tenant leaders, clergy leaders, and civil legal service providers who joined Council Member Mark Levine and me in bringing equity and justice to our housing court system.”

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://www.blueharbourpropertymanagement.com/city-council-passes-bill-providing-legal-representation-tenants-facing-eviction/

Foreclosure Activity Lowest Since Pre-Recession 2005 Level

Housing appears to be stabilizing nationwide however there is still need for improvement in the New York City metropolitan region.  ATTOM Data Solutions, a company which curates a multi-sourced housing database released a report today indicating that foreclosure filings are at the lowest levels since 2005.  Foreclosure filings consists of default notices, scheduled auctions and the actual repossession of the property by the banks.  It is being reported that there were 77,049 filings on U.S. properties in April. This is down 23% from a year ago at the same point and at the lowest level since November 2005.

"Foreclosure activity continued to search for a new post-recession floor in April thanks in large part to the above-par performance of mortgages originated in the past seven years," said Daren Blomquist, senior vice president at ATTOM Data Solutions. "Meanwhile we are seeing an elevated share of repeat foreclosures on homeowners who often fell into default several years ago but have not been able to avoid foreclosure despite the housing recovery."
Of particular interest in the Northeast is that in New Jersey, Connecticut and Massachusetts foreclosure filings actually increased by 1%, 29% and 3% respectively.

Also of note is that a new analysis of repeat foreclosure starts, shows them increasing in some areas and in particular in New York City. In NYC repeat foreclosures occurred at 54%. This was the highest level of the 5 metropolitan areas that were examined for the analysis.  The other cities included Los Angeles (39%), Miami-Dade County (32%), Maricopa County, Arizona (26%) and Essex County, New Jersey (20%). A repeat foreclosure start is defined as a foreclosure start filed on a property address-owner last name combination in 2016 with a previous foreclosure start on the same property address-owner combination in the last 10 years.

Nationwide, initiating foreclosures are at pre-recession levels.  A total of 34,085 U.S. properties started the foreclosure process in April, down 6 percent from March 2017 and down 22 percent from the same time a year ago.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.
http://www.blueharbourpropertymanagement.com/foreclosure-activity-lowest-since-pre-recession-2005-level/

Maximizing Your Returns During Peak Rental Season in NYC

In the property management industry, we know that the period between April and September is the peak season for rentals in NYC.  This is the time when renters, home owners and first-time home shoppers decide to make the transition to their next home. It’s is estimated that between roughly 78% of all moves happen during this period with the highest number of moves in June, July and August.

In that same period of time, roughly 30% of individuals decided to forego renewing their lease and look to new housing.  With so many people moving during this period it become critical that property managers in NYC become aggressive in advocating on behalf of your landlords and look for the best tenants available. Property managers should focus on turnover during this peak season in order to get the best quality tenants and increase rents if the market allows in your neighborhood.

During the peak rental season the market is at its highest point with respect to prospects looking for a new place to call home. This means you can ask for a slightly higher rent amount than you would in the off season. In addition to setting a higher standard for tenants, you can also set the rent slightly higher and still have a plethora of prospects who are willing to pay a bit more for their ideal home. Even in New York City’s feverish market, we can push rents a little further during this peak period.

As a seasoned real estate practitioner, property manager or landlord in New York City, you want your property to come available for rent April through September. The best way to ensure that this happens is to negotiate with your tenants for the lease to end during the peak rental period.  It can be advantageous on your end to sign a longer lease or shorter depending on when you are signing in order to gain the peak season for renters.

At Blue Harbour Property Management, we have helped many landlords maximize their rental revenues by using techniques such as using the peak season for the signing of leases.  This has become more important as rents have vacillated in Brooklyn, Manhattan and Queens for the last 18 months.

If you need assistance with the management with your property in the NYC region or would like additional information on what services we provide you can contact us at anytime at 718-843-1185.  We are a leader of small and medium sized properties in the New York City region.

http://www.blueharbourpropertymanagement.com/maximizing-returns-peak-rental-season-nyc/

Visit us at www.blueharbourpropertymanagement.com

Airbnb has decided to drop their lawsuit against the City of New York, the largest market for its operations with revenues exceeding 1 billion dollars in the city for its hosts.  Airbnb has had a huge impact on business specifically in Manhattan and Brooklyn.  The lawsuit was based on a law signed in October that called for fines of as much as $7,500 for illegally listing a property on rental platforms such as Airbnb.  The law would have imposed fines that would have hampered Airbnb's operations throughout the country and required additional supervision of listings being put on their website.  The lawsuit was dismissed on the agreement that New York City enforce the law only against hosts and Airbnb not be fined.  The settlement of the lawsuit goes into effect today December 5, 2016.   For more about the settlement you can read here.

NYC property management companies have vehemently objected to Airbnb taken hold in New York City. Specifically some landlords have been fined and violations imposed as a result of tenants illegally renting out their apartments to Airbnb'ers.  A recent case brought by Related exemplifies this.  In the particular instance, Related attempted to evict a rent-stabilized tenant who they discovered was renting the unit out on Airbnb for $649.00 per night.  The tenant was paying $6,670 for the unit on the market rent of $9,000.  Related sought and received an eviction.  The state appeals court held that tenants have no right to benefit from apartments that have rent restrictions.

Although there are no guarantees that this would stop illegal units cropping up throughout the city, it is certainly a positive step into deterring possible violators.  It will be interesting how the City will go about enforcing the law going forward but Assemblywoman Linda Rosenthal is optimistic that there will be a crackdown.   She states “I expect the city will now get down to the important business of enforcing the law against the serial lawbreakers on the site” who turn affordable housing intol illegal hotes. This is a win for everyone."

http://www.blueharbourpropertymanagement.com/airbnb-drops-suit-city-hosts-will-fined-instead/

Visit us at www.blueharbourpropertymanagement.com