Stuyvesant Town and Peter Cooper Village

When all hell broke loose regarding the court case between the tenants of Stuyvesant Town/Peter Cooper Village and Tishman Speyer, residents of New York began to wonder how many other landlords were illegally receiving J-51 tax breaks from the city while deregulating previously rent stabilized apartments. In the case of Stuyvesant Town/PCV, Tishman Speyer purchased the middle class property giant (in one of the biggest deals in real estate history). They intended to kick out the rent stabilized tenants (many of whom had been living there since the property’s inception after World War II – it was created for returning vets and their families) and transform Stuyvesant Town and PCV into a luxury community. However, they underestimated both the power of the people and their ability to break the law. While deregulating apartments, they not only received J-51 tax breaks from the city (something given only to landlords operating rent-stabilized apartments), but also discovered that kicking out long time tenants isn’t easy.

Fast forward to today. The property has gone into foreclosure, as Tishman defaulted on a loan payment on January 8th, 2010. A few months back, the tenants, fighting against the market rate rents they were being charged, won their case in court, bringing back rent stabilized apartments to the property until June 2010 (if not longer). The entire situation is extremely complicated – but it does bring about questions of how many other landlords have attempted to receive J-51 tax breaks for non rent-stabilized apartments in the past.

Now, the rumor mill is churning, wondering if Tribeca’s Independence Plaza North property should earn the title of “The Next Stuy Town.” Writes Curbed: Landlord Laurence Gluck pulled the 1,339-unit Independence Plaza North complex out of the Mitchell-Lama program in 2004 but continued receiving J-51 tax breaks for two years after that. Realizing this could end up causing rent problems, Gluck repaid two years of the tax breaks to the city, and the city retroactively agreed that he had stopped getting them in ’04. Tenants sued, arguing that their rents just should have been stabilized all along, and the judge in the case asked for DHCR’s opinion, the Times reports. DHCR’s ruling was…not to make a ruling. The city runs the J-51 program, DHCR said, so if the city says Gluck stopped receiving J-51 benefits in 2004, ’04 it was.

And so it is – no one can steal Stuy Town’s thunder!