Source: New York Times
How Titans of N.Y. Real Estate Were Trounced in Historic Rent Law Deal
Landlords were “shocked” by Tuesday’s deal strengthening tenant protections.
Less than a day after newly emboldened Democratic lawmakers announced bills that would significantly tighten tenant protections, prominent real estate developers got Gov. Andrew M. Cuomo on the phone to make a last-ditch plea to persuade him to block the measures.
The developers, including Douglas Durst, Richard LeFrak and William C. Rudin, are involved with some of the most iconic buildings on the New York City skyline, including One World Trade Center and 3 Times Square, and have long wielded major influence in Albany.
They and their counterparts in the real estate industry have donated millions of dollars in campaign contributions to Mr. Cuomo and other state politicians in recent decades.
But on Wednesday, Mr. Cuomo rebuffed the developers, telling them that “they should call their legislators if they want to do something about it,” said a person briefed on the call, which lasted about 15 minutes.
The phone call capped a humiliating moment for an industry that had long reigned in the state capital.
“I’m in shock. I think many of us in my industry are in shock,” said James R. Wacht, president of the firm Lee & Associates and a board member of Real Estate Board of New York, the industry’s leading trade group. “It’s a lot worse than we anticipated.”
The bills announced on Tuesday night by the Democratic leaders of the State Senate and the Assembly would abolish rules that let building owners deregulate apartments and close loopholes that permit them to raise rents.
The legislation would directly impact almost one million rent-regulated apartments in New York City, which account for more than 40 percent of the city’s rental stock, and allow other municipalities statewide beyond New York City and its suburbs to adopt their own regulations.
[Read more about how the new rent regulations in New York would affect tenants and landlords]
Real estate industry groups said the bills would do serious damage to housing in the city by reducing incentives for landlords to renovate existing apartments and to build affordable new ones.
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