Supporters of the legislation say property owners, particularly large corporate landlords, should not have the power to abruptly deny leases to existing renters and kick them out of their homes. Property owners say it’ll saddle them with problem tenants.
Shortly after a vast real estate firm purchased their Brooklyn building, Ahn Thu Nguyen and Cassie Newsom learned they were losing their homes. The new property owner, Greenbrook Partners, issued each of them a notice saying the management company would not renew their leases at the 30-unit complex on 70 Prospect Park West.
About a mile north, Prospect Heights school teacher Vanessa Figueroa got a knock on the door from a worried neighbor with a similar non-renewal notice. That was in June, not long after Greenbrook bought Figueroa’s 16-unit building; by the beginning of August, seven tenants, including the worried neighbor, were gone.
“I started seeing all this furniture outside,” Figueroa said. “In the span of a month and a half, all these tenants have been moved out of the building.”
But Nguyen, Newsom and Figueroa decided to fight back. The three Brooklyn residents are part of a growing network of Greenbrook tenants resisting the non-renewal notices and abrupt rent hikes they have received since the company took over their buildings and about 90 others across the borough.
They say property owners, particularly large corporate landlords, should not have the power to abruptly deny leases to existing renters and kick them out of their homes. Many local lawmakers and tenants rights advocates agree, reigniting an effort to pass legislation in Albany that would stop landlords from jacking up rents or denying new leases to existing residents. Meanwhile, New York City property owners and their representatives have framed the proposed protections as a radical attack on property rights, saying the measure would cut into landlord profits and saddle them with problem tenants.
The measure, known as the “Good Cause” bill, would give tenants the right to a lease renewal in most cases and prevent landlords from removing a tenant without an order from a judge, even if that tenant’s lease has expired or they never had a lease. The bill also caps rent increases at 3 percent of the total, or 1.5 percent of the Consumer Price Index, whichever is higher. Tenants would be able to challenge higher rent raises, forcing landlords to justify the increase in court.
In recent months, two New York municipalities—Albany and Hudson—have passed their own version of Good Cause protections, but state law prohibits New York City from doing the same.
As New York’s latest round of COVID-related eviction protections near a January end date, the Good Cause legislation, sponsored by Brooklyn Sen. Julia Salazar and Syracuse Assemblymember Pamela Hunter, has reemerged as a top priority for many tenants rights advocates. A coalition of more than 70 tenant groups and legal service providers from across New York have urged state leaders to prioritize the bill in the upcoming legislative session.
“If nothing is done, and after the eviction moratorium eventually expires, it is only a matter of months before New York grapples with an unprecedented eviction crisis,” the groups, organized by the Legal Aid Society and Housing Justice For All, wrote in a letter to Gov. Kathy Hochul, Senate Majority Leader Andrea Stewart-Cousins and Assembly Speaker Carl Heastie. “Amid this ongoing and unprecedented public health crisis, keeping New Yorkers in their homes is vital to lessening the devastation caused by COVID-19.”
New York City tenants in rent stabilized apartments—located in buildings with six or more units built before 1974—are already protected by laws similar to the Good Cause protections. The Rent Guidelines Board sets a modest annual rent increase or, as in recent years, freezes the rent, and tenants cannot be denied a new lease unless the landlord plans to keep the unit for themselves or their family.
About half of New York City’s apartments do not fall under rent stabilization, however. And tens of thousands of apartments have been removed from the stabilized rolls over the past three decades.
From 1993 to 2018, more than 152,000 rent-stabilized apartments were deregulated, meaning landlords could set any rental amount on new tenants. Property owners managed to remove another 8,000 units from rent-stabilization via vacancy rent hikes just before landmark tenant protections took effect in June 2019.
The Good Cause bill has faced intense opposition from landlords and their representatives who say it would cap their rental income and remove their key leverage over problem tenants, especially as housing courts contend with a massive backlog of cases amid ongoing pandemic eviction protections.
“Good Cause is a nice name for rent control,” said Brooklyn landlord Robert Lee, who has five buildings in Williamsburg and participates in the group Small Property Owners of New York (SPONY). He said another regulation will drive more small property owners to sell their buildings.
“And then what are they left with? the people who they were speaking out against on Friday,” he said, referring to a rally held that day outside Greenbrook Partners’ building on Prospect Park West.
In an interview Monday, Lee and SPONY organizer Ann Korchak said rents on market rate units—apartments that do not fall under rent stabilization laws—subsidize other units in the building, and enable owners to make repairs or cover property tax increases. Korchak said the flexibility to deny a new lease also allows landlords to remove tenants without waiting for lengthy housing court proceedings to play out.
“The problem with Good Cause is it’s incredibly restrictive,” Korchak said. “Not offering a renewal is a practice that can get rid of an untenable situation for every renter in the building.”
Supporters, however, point out that the measure would still enable landlords to evict tenants who fail to pay rent or otherwise break the terms of their leases, including individuals who create a nuisance, commit crimes or make life hell for their neighbors. Property owners would also be free to raise the rent as high as they see fit on non-rent stabilized units once an apartment becomes vacant.
“Once a tenant leaves, they are allowed to do whatever they want,” said Housing Justice For All organizer Cea Weaver, a tenants rights advocate who helped craft the bill. “Basically all it says is that a judge has to decide if a rent increase is fair.”
The Good Cause opponents won out two years ago, even as lawmakers passed a package of other tenant protections. Legislative leaders declined to bring the bill to a vote in 2019, and Assembly Speaker Carl Heastie is still seen as a major obstacle to its passage this coming session.
Advocates suspect Senate Majority Leader Andrew Stewart-Cousins would support the measure, however. Stewart-Cousins has already sponsored legislation a lot like the Good Cause protections for seniors and people with disabilities last session. Her bill passed the Senate, but did not come up for a vote in the Assembly. Stewart-Cousins and Heastie did not respond to emails asking for their stance on the statewide Good Cause bill.
Still, many other members across the Democratic Party spectrum are championing the legislation.
State Sens. Brian Kavanagh, Jabari Brisport and Zellnor Myrie, along with Assemblymembers JoAnne Simon and Robert Carroll, joined Greenbrook tenants at the rally outside 70 Prospect Park West to urge passage of the bill Friday. The measure also has the support of more moderate Democrats, like Queens Sen. Toby Ann Stavisky. And Lt. Gov. Brian Benjamin co-sponsored the bill last legislative session.
Kavanagh, the chair of the Senate housing committee, said the bill would remove the profit motive for real estate investors who now have the right to buy a building and clear out the residents.
“You cannot be evicted from your home unless your landlord has good cause to do that. It’s a simple concept,” Kavanagh said. “That is by the way how our real estate market worked in New York for many, many years. This idea of eviction for profit is a relatively new thing in New York in the past decades. Many predatory equity companies have cut their teeth on it. Many have become thirsty for that kind of profit.”
On its website, Greenbrook Partners describe that very business model. The firm says it “targets investments in poorly maintained, undermanaged and undercapitalized assets located in growth-oriented and transitional submarkets of New York City” in order to “maximize value.” The company did not respond to emails and phone calls seeking comment.
Greenbrook is funded in part by a $100 million investment from the Texas Permanent School Fund, a nearly $47 billion wealth fund that benefits schools across the Lone Star State.
That investment stood out to Newsom, one of the 70 Prospect Park West tenants who received a 90-day non-renewal notice. She worked as a Texas public school teacher before moving to Brooklyn.
“Learning the Texas PSF was investing in a family that was trying to displace my family as well as many other rental families in order to fund Texas public school students made me feel sick to my stomach,” Newsom said. She and her neighbors, as well as several local lawmakers, have urged the Texas State Board of Education (SBOE) to divest from Greenbrook. The SBOE did not provide a response for this story.
U.S. Sen. Chuck Schumer, who appeared at the rally and denounced Greenbrook as an example of the “powerful, vicious interests that try to take advantage of people,” also sent a letter to the SBOE.
Schumer, however, refused to discuss his stance on the Good Cause bill when asked by City Limits Friday.
That may be a good sign for landlords, said Jay Martin, the head of the Community Housing Improvement Program (CHIP). Martin’s trade group represents 4,000 owners and managers of over 400,000 rent-stabilized units in New York City, many of whom hope moderate Democrats, like Gov. Kathy Hochul, will stymie the bill.
Hochul has taken large campaign contributions from real estate interests that oppose the measure, and her husband served on the board of a Western New York business group that sharply criticized Good Cause protections earlier this year. But activists expect she would sign the bill if it passed the legislature in an election year.
Hochul’s spokesperson Avi Small said she “is firmly committed to helping New Yorkers stay in their homes and will carefully review all legislation that reaches her desk.” Small also highlighted tenant protections the governor has presided over during her brief tenure, including the extension of state eviction protections and the acceleration of the state’s Emergency Rental Assistance Program.
Martin said Greenbrook is an easy target for Good Cause supporters to make their case. The company is a particularly egregious example of a predatory real estate firm, but small landlords shouldn’t be painted with the same broad brush, he said.
“Cost increases for them are to cover operating costs,” he said. “It isn’t like they’re there twirling their mustaches and saying ‘I’m going to jack up rent this year.’”
He said capping rent increases on existing tenants in unregulated units would affect all tenants, because small landlords use profits from those apartments to cover improvements on the entire building, as well rent-stabilized units.
“Here’s the dynamic that Good Cause doesn’t account for: In rent-stabilized buildings, the only thing that keeps them afloat is fair market units,” Martin said. “The ridiculousness of the Greenbrook model, jacking up rent by 20 percent, that’s a good thing to flag and there should be a policy, but the idea that a blanket proposal that every single property owner has to abide by is not.”
Tenant advocates counter that the bill still allows for rent increases based on capital repairs—though the 2019 tenant laws capped the amount—and would limit speculation and flipping, making it easier for first-time home buyers to purchase houses.
This week, the City Council will also weigh in on the legislation, introducing a resolution calling on New York lawmakers to pass the statewide measure. Councilmember Brad Lander, the Democratic nominee for Comptroller, has worked with the Greenbrook tenants since June and has signed onto the Good Cause resolution.
He acknowledged the concerns of small landlords, but said those issues are minor compared to the risk of displacement for New York City tenants.
“The trauma for tenants who get evicted in a tight real estate market is far more severe than the challenges facing a small landlord,” Lander said.
“Do I have more sympathy for a small business owner versus Greenbrook Partners? Sure,” he continued. “But if your business model, even if it’s a small business model, requires the right to throw people out of their homes without a good reason, that’s not a business model we want to encourage in New York City or New York State.”