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2006-06-02

How One of New York City’s Biggest Landlords is Systematically Driving Out Thousands of Low-Income Residents

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One of the biggest owners of rent-stabilized apartments in New York–the Pinnacle Group–is carrying out an aggressive campaign to chase out many of its low-income and elderly tenants living in Harlem, the South Bronx, Queens and Brooklyn. Democracy Now! co-host Juan Gonzalez has been reporting on the issue for the Daily News for the past month. [includes rush transcript]

We turn now to look at the issue of gentrification and how it is playing out in certain areas of New York City. One of the biggest owners of rent-stabilized apartments in New York, the Pinnacle Group- is carrying out an aggressive campaign to chase out many of its low-income and elderly tenants living in Harlem, the South Bronx, Queens and Brooklyn. Juan Gonzalez has been reporting on this for the Daily News for the past month.

We are joined in our studio by attorney Kim Powell, she is the head of Buyers and Renters United to Save Harlem, or BRUSH.

We asked a representative from the Pinnacle Group to be on the program but they declined our invitation.

  • Juan Gonzalez, Democracy Now! co-host and New York Daily News columnist.
    - Read Juan’s * articles* in the Daily News.

Transcript

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: We are also joined in the studio by attorney Kim Powell, who is head of the Buyers and Renters United to Save Harlem, or BRUSH. We did ask a representative from the Pinnacle Group to be on the program, but they declined our invitation. Juan, why don’t you lay out this series of groundbreaking stories you’ve been doing that could well lead to some indictments?

JUAN GONZALEZ: Yes, well, I’ve written now seven columns in the past month, all detailing the practices of this group called the Pinnacle Group, which is a largely unknown real estate company in the city, but which has mushroomed in the last few years to now own 20,000 rent-stabilized units. Remarkably, I found out that in the last two years, they’ve tried to evict a quarter of all of their tenants, 5,000 eviction proceedings in the various housing courts in the boroughs of New York. They are systematically, apparently, trying to force out as many people as possible to take advantage of rent stabilization laws that allow them to sharply to double or triple the rents, so an apartment that was once renting for $500 a month is suddenly — you know, they get the old tenant out, they bring in — they do some quick remodeling of the apartment, and suddenly it’s $1500 a month or $1700 a month. And they’ve been doing it throughout the city, largely unnoticed.

And one of the things that I began to uncover is that a lot of these rent increases are based apparently on fraudulent work, that invoices that — for instance, I found in one apartment they claimed they spent $1,000 on 100 gallons of paint to paint one apartment. Anybody who has painted an apartment in their lives knows you don’t need that much paint. You can paint a whole building for 100 gallons of paint. And that there were all kinds of situations where the actual documents that they submitted to state agencies are highly questionable and may be actually fraudulent.

But then there’s the stories of all these elderly, mostly senior citizens, disabled people, immigrants, who are being dragged through the courts, many of them on bogus charges, just to see if they can be forced out, just to see if they won’t be able to withstand going — I had a 75-year-old woman who has been to court now in the last two years over two dozen times, with Pinnacle trying to get her out of her apartment.

So — and in the process, of course, I met Kim Powell and their group, which has been formed predominately to fight Pinnacle. And, Kim, maybe you’d like to tell us how you got involved and how you began to realize that this Pinnacle thing was a huge problem across the city.

KIM POWELL: Sure. Pinnacle management had actually been the owner of a few buildings along the west corridors of upper Manhattan. And with that having been said, roughly around June of last year, they began about the process of attempting to convert two or three of the buildings just along Riverside Drive. So, with that information in mind —

JUAN GONZALEZ: When you say "convert," to convert them to condos.

KIM POWELL: To condominium. Condominium conversion. They filed what was called a red herring with the Attorney General’s office. Once that occurred, once that information was given to the tenants, it was the responsibility of myself and another of the tenants in the neighborhood to go about the business of making inquiries as to exactly how many buildings would be affected by this condo conversion. Of late, we know that there are seven buildings in which he’s filed for condominium conversion.

One of the things that was frightening with the condominium conversion is that what it said on two levels was that the asking prices were not commensurate with the housing stock or the per capita income in the neighborhood, any more than the quality conditions of these buildings were commensurate with the asking price. The median asking price was between — in an as-is condition of the insider’s price is, say, somewhere between $800,000 and $1 million per unit.

AMY GOODMAN: I wanted to turn to a meeting that took place. On May 15, three local community boards held a hearing where tenants testified about their treatment from Pinnacle after the company bought their building.

TENANT 1: I live at 680 Riverside Drive. That is at the exact corner of 145th Street. Two years ago, there was a fire during Father’s Day, okay? As of today, there are still several outstanding violations on the building. The building is in the middle of a condo conversion. My concern is that there were several tenants who were offered buy-outs to give up their apartment for this condo conversion. My concern is these outstanding violations, for those of us who choose not to move and/or buy the apartments because of the exorbitant prices for the condo conversion.

TENANT 2: Regarding illegal evictions, we had one family on the third floor in our building, where the mother went out to pick up the daughter from school. When she came back, the marshals were there. They evicted her. The family had to stay with one of the neighbors in our building. Took them almost three weeks. Pinnacle claimed that they owed three months in, you know, back rent or what have you.

TENANT 3: The building is at 964 Amsterdam Avenue. And it went up in flames one week after Joel Wiener took it over from Baruch Singer, and it has not appeared in one article, with the exception of the New York Times. And it went up in flames, killing two of our neighbors, two of the sweetest people I ever knew. And it is as though it has not happened. 22 firefighters were injured. Numerous tenants suffered burns. Household pets were killed. And we are still locked out of that building. And Mr. Wiener is using every tactic in the book to stall and delay, even as there’s a court order saying the building must be completed and repaired by June 30, and the contractor has just told us they are not going to meet that deadline.

BOBBY JONES: My name is Bobby Jones. And since 1967, my family and I have occupied an apartment, [inaudible] apartments. In the last eight months, we have had to go to court six times to respond to charges by the current owner and the previous owner. By the grace of God, I’m happy to say that each time we were victorious. In the last court proceedings, not only was I given an abatement, but I was also given an order by two separate judges to force Pinnacle to give me keys after they had changed the locks on the entrance to my door. More so than anything else, I have a message for Pinnacle. I’ve been here since 1967. I’ve seen seven different owners. I’ve gone to court numerous times. And like most people who spoke before me, I am not afraid. I will not leave. You cannot make me. I am not going.

AMY GOODMAN: New York tenants testifying against Pinnacle at a community board hearing. New York Democratic Congressmember Charlie Rangel was also in attendance. He blasted what he called a conspiracy to gentrify the community.

REP. CHARLES RANGEL: And what you are doing is stopping even a broader conspiracy to take our community away from us. This is not just coming from Pinnacle, but throughout our borough we have similar schemes where speculators and landlords have acquired large amounts of property and found loopholes in the state law that would allow them to move in an aggressive way to remove tenants, either through legal means or through harassment. And once they leave, the apartments are redone, and the type of rents that are being asked for or demanded are absolutely ridiculous.

AMY GOODMAN: New York Congressmember Charles Rangel. Juan, you were also at this meeting. Why is this a national story?

JUAN GONZALEZ: Well, I think what it is, is first of all, it would be a national story in its own when you have thousands of people suddenly being forced out of their homes in New York. And despite all the press that we have in this city, nobody has been covering this. But I think that there is a national significance to what is going on, and it’s a theory of mine that I’ve been developing now as I report on it and analyze the situation in urban America —- is that increasingly, especially now that we’ve reached a peak oil crisis, there is a concerted move to move the middle class and the upper classes, that moved out to the suburbs back in the '60s and the ’50s and the ’70s, back into the cities, that there are many people who are living in the exurbs who don't want to have to drive one-and-a-half hours to work every day in the city and now to spend so much more money on gas. And so, that real estate speculators -—

AMY GOODMAN: And also older people.

JUAN GONZALEZ: And older people, as well. So what’s happening is real estate speculators are realizing that the market is ripe to re-grab the inner cities and to, in essence, create urban America as more in the European models, where the middle and the upper classes live in the central cities and the poor live in the suburbs, on the Parisian model, for instance. The immigrants or the poor in Paris live in the suburbs, not in the city.

And our city, as developed throughout the ’50s and ’60s, was basically the central city as being the place where the poor lived. And so now there is a concerted effort to recapture the cities and to displace and to move out the residents that are there. And why so many of the black and Latino political officials are now getting up in arms over this is because they also realize it has political significance, in terms of their political bases are now being dramatically changed as more and more upper-income people and upper middle class people are now replacing their original constituents.

So I think that — and the problem is that government policy, rather than try to assure affordable housing and a good mix of poor, working class and upper class within urban America, the policies that local governments are pursuing now are really to assist these landlords and developers in pushing people out and driving up prices. So I think that it’s — I do not believe that what’s happening in New York City is an isolated situation. I actually believe it’s happening, and I’ve been receiving emails from people in other parts of the country, in Chicago and other places, in the Southside of Chicago and others, that the same thing is happening.

AMY GOODMAN: Well, Juan, we’re going to link to all of your stories at democracynow.org. And Kim Powell of BRUSH, living in one of the Pinnacle buildings, we thank you very much for being with us.

KIM POWELL: Thank you for having me.

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