Are Landlords Telling the Truth? The City Doesn’t Always Check. He Does.
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| An opposing lawyer called Aaron Carr, the founder of the Housing Rights Initiative, “a very dangerous young man.”Hiroko Masuike/The New York Times
Sept. 23, 2018
In New
York City, landlords looking to renovate are supposed to tell the Buildings
Department whether their tenants are protected by rent regulations. The idea is
to prevent harassment by owners seeking to force renters out in order to charge
more. But the Buildings Department does not always check to see if the
landlords are telling the truth.
Aaron
Carr, however, does.
Mr.
Carr, 30, is the founder of a start-up tenant watchdog agency, the Housing
Rights Initiative, and his specialty is searching public records at state and
city agencies to expose what he says is a broken system of tenant protections.
On
Monday, Mr. Carr’s latest report is scheduled to be released at a news
conference on the steps of City Hall with City Councilman Ritchie Torres of the
Bronx. According to H.R.I.’s research, on more than 10,000 building permits
filed with the city over the past two years, landlords lied about whether there
were rent-regulated tenants in their buildings — and got away with it.
Mr. Torres said that the city, which has made affordable housing
a priority, should shoulder an equal amount of the blame. “Just as scandalous
as the number of falsified permits is the failure of enforcement by the
Department of Buildings,” he said.
And while the buildings department
is hiring 70 new inspectors, he said that a landlord who mistakenly checks the
wrong box on a permit application is not necessarily breaking the law.
“Every day, the Buildings Department
holds landlords accountable for their obligation to provide safe buildings for
tenants, both on our own and through our work on the city-state Tenant
Harassment Prevention Task Force,” Mr. Soldevere said.
[Affordable housing in New York is vanishing, despite strong
tenant protection laws. How can that happen?]
In its scant two-year existence,
H.R.I. has had an oversized impact on landlord-tenant relations: Mr. Carr’s
group has issued a series of scathing reports on bad behavior by landlords,
enabled by what it says is the failure of state and city government to hold
them accountable.
H.R.I. does not stop at issuing reports. It puts together
tenants with lawyers willing to work for free or on contingency, and has helped
initiate 49 lawsuits, against state and city officials and some of the city’s
biggest landlords: A&E Real Estate Holdings, Stellar Management, Bronstein Properties, and, especially, Charles Kushner
of Kushner Companies, whose son Jared is a son-in-law and
senior adviser to President Trump.
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| Aaron Carr, who has become a self-appointed enforcer of state rent laws, goes after landlords he suspects aren’t complying with regulations. PHOTO: MICHAEL BUCHER/THE WALL STREET JOURNAL |
Rent Gadfly Takes On New York Landlords, One Building at a Time
Aaron Carr organizes class-action lawsuits against landlords he suspects of breaking the law
Sudesh Chohan was thinking of leaving his Flushing, Queens, apartment after 28 years because he couldn’t afford the latest rent increase. His plans changed when the 62-year-old auto mechanic bumped into Aaron Carr.
At Mr. Carr’s suggestion, Mr. Chohan attended a June meeting at a playground where Mr. Carr said the building’s tenants may have a legal case against their landlord, Kaled Management. Mr. Carr contended that Kaled had overcharged them by ignoring their apartments’ rent-stabilized status, which limits price increases.
In August, Kaled offered tenants refunds, including $6,030 for Mr. Chohan. Ed Kalikow, Kaled’s president, said in a statement tenants were “inadvertently” overcharged and that “making residents financially whole was not only legally compliant, but it was the right thing to do.”
At age 29, Mr. Carr has become New York City’s self-appointed enforcer of state rent laws. Last year, he started a nonprofit, Housing Rights Initiative, through which he organizes class-action lawsuits against landlords he suspects of breaking the law.
He hopes to launch 75 to 100 cases over the coming year to enforce a requirement that landlords who collect a popular tax break known as “J-51” limit rent increases on tenants. For years, regulators let thousands of owners ignore that rule, making housing less affordable for renters like Mr. Chohan.
Property managers and investors are watching with
interest since legal settlements of tenant lawsuits can reach millions of
dollars. One class-action lawsuit over the J-51 issue resulted in $69 million
of refunds for 22,000 tenants at the Stuyvesant Town-Peter Cooper Village
residential complex in Manhattan and lowered rents by $105 million. A 2007
class-action case against landlord Pinnacle Group settled for $2.5 million in
2011.
Though noncompliance is common, not all owners are
cheating the system. Many in the industry view Mr. Carr’s work with skepticism.
“I look at it as the equivalent of, like, an ambulance
chaser,” said Brian Newman, who manages about 30 properties for Heritage
Realty, one of the firms targeted by Mr. Carr. The Rent Stabilization
Association, a landlord group, calls Mr. Carr’s efforts “nothing more than
fishing expeditions.”
Mr. Carr disagrees. “If the landlords are not doing
anything wrong, why are they restabilizing units?” he asks. “They’re doing that
because they got caught.”
Mr. Carr grew up on Long Island, the only child of an
autism researcher and a psychologist. Both parents died in a car crash when he
was 20.
“Life took on a whole new meaning,” he said. “I needed
to attach myself to things that would have an impact on people’s lives. I may
not be able to get back what was stolen from me, but I can get back what has
been stolen from others.”
Helping tenants recover overcharges fit that mission.
He got the idea while working as chief of staff to New York Assemblyman Michael
Blake, a Democrat who represents a gentrifying section of the Bronx.
“There is not a day that goes by that someone is not
contacting us about housing concerns,” Mr. Blake said. He recalled seeing “a
visceral anger” in Mr. Carr when he learned of owners mistreating tenants.
In early 2016, he left Mr. Blake’s office to launch
Housing Rights Initiative, using personal savings and donations to get started.
Now he is getting ready to scale-up with a $100,000 crowdfunding campaign.
The campaign kicked off with a dinner hosted by Bill
Samuels, a Democratic activist and fundraiser, who was surprised to see Mr.
Carr raise more than $23,000. “These events, usually if they raise 10 grand,
it’s a lot,” Mr. Samuels said. “I was shocked.”
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| Sudesh Chodan |
Mr. Samuels credited the success to Mr. Carr’s
message—an animated power point in which he excoriates regulators. The state
housing agency says it “aggressively” enforces rent laws, but Mr. Carr openly
mocks that claim, saying city and state agencies have often turned a blind eye to tenants’ plight.
“We all live in an enforcement desert,” he said while
standing in front of a slide of the Sahara one August evening when more than 40
residents of eight Manhattan buildings gathered at a Lutheran church to hear
him pitch litigation.When Mr. Carr mentioned his most recent target—Kushner Cos., the real estate empire formerly run by Jared Kushner, President Donald Trump’s son-in-law—he drew applause. After the meeting, tenants lined up to share rent records with Mr. Carr, who scanned them on his iPhone.
Mr. Carr doesn’t file the lawsuits himself. He leaves
that to attorneys who agree to charge tenants legal fees only if they prevail.
Ten lawsuits have been filed so far, all of which are in various stages of
litigation.
Soon after the August meeting, Mr. Carr goes to Civic
Hall, a Chelsea co-working space that serves as his informal headquarters, to
identify potential plaintiffs. Kim Powell, a tenant activist who helped
organize the Pinnacle class-action case, reviews tenant records with him.“Slam dunk,” she says as they review potential plaintiffs in one building.
Mr. Carr then opens a Google map populated with hundreds of buildings he wants to target for his “J-51 crusade.” The buildings are color-coded by severity of noncompliance. He shows Ms. Powell a cluster in Queens where he believes they should hand out fliers next; one Flushing building sits blocks from Mr. Chohan.
A few days later, Mr. Carr is back in Flushing. Mr. Chohan can’t hide his gratitude, calling him a “messiah” for helping save his home.
Write to Cezary Podkul at cezary.podkul@wsj.com
Appeared in the October 10, 2017, print edition as 'Organizer Goes to Bat For Tenants.'
