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City Slammed For Creating Buyout Boogeymen

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September 30, 2015

By Dan Orlando


 

Legal experts are warning New York City landlords to be afraid of strict new rules governing their right to make buyout offers to tenants.

“Ronald Reagan once said that the nine scariest words in the English language are ‘I’m from the government and I’m here to help,’” said attorney Adam Bailey, of  Adam Leitman Bailey P.C.

“Every landlord doing business in New York City should be scared of local government right now.”

Bailey has taken aim at several amendments to an NYC Administrative Code set to take effect in December that will make it tougher for landlords to negotiate tenant buyouts.

The new rules will prohibit a landlord from using threatening, intimidating, or obscene language; initiating buyout talks too frequently; talking to the tenant at work; lying to the tenant; contacting a tenant before six months have passed since the tenant asked in writing that the owner make no such contact; and failing to give the tenant a written statement of the tenant’s rights.

The city said the amendments are a response to owners who have used “unscrupulous tactics to pressure tenants out of affordable apartments so they can reap rent increases from the turnover.ˮ

However Bailey — who has represented both tenants and landlords in several high profile housing cases in the city — calls them “part of a greater agenda of a communist and socialist administration that is trying to do whatever it can to save rent regulation.ˮ

He said, “Why would the administration get in the way of something that helps New Yorkers make more money? It makes no sense except that they’re trying to save a broken system called rent regulation. They’re not prohibiting buyouts, they’re basically putting up road blocks.

“Politicians like [the changes] because a lot of the people who vote are these rent regulated tenants. But I think this is one of the worst laws I’ve ever seen.”

Tenant groups throughout the city have roundly applauded the Code Amendments.

In June, when Mayor Bill de Blasio signed in three new tenant protect measures, Scott Stamper, Supervising Attorney at MFY Legal Services, which represents low-income tenants throughout the city, commented: “We’ve seen a real rise in landlords stalking, threatening, and badgering tenants with unwanted buyout demands.

“This isn’t negotiation, it’s harassment. As with anyone else, when a tenant says no it means no, and we commend the Mayor and the Council for giving tenants another tool to stand up for themselves.”

Bailey argues that the amended regulations are not the result of complaints from tenants regarding landlord abuse and said that he had seen no evidence of this being the case.

“This one hurts the tenants,” said Bailey, noting that the ambiguity with the restrictions could lead to accidental infractions for landlords who were in no way harassing their tenants.

“In 20 years of practicing law, I have only met one tenant in my life that didn’t want a buyout at some number. “When I first started, $10,000 would do it for most of them. Now $40-70,000 in Brooklyn and a full million dollars in places like midtown Manhattan,” could be on the table for tenants who are willing to be bought out of their lease, Bailey said.

Those offers can still be made, but the new laws may slow down that process and make it more difficult.

“The new laws are clearly intended to be as pro-tenant as possible,” said Bailey in an Op-Ed he co-authored with colleague Dov Treiman for Real Estate weekly.

“However, in the City Council’s enthusiasm to provide tenants with new protections, owners may find that they are so hamstrung by the new regulations that tenants who actually want to be bought out may find themselves facing completely unanticipated hurdles. Under these new regulations, owners will proceed at their peril without attorneys’ advice at every stage in a buyout offer.”

The penalty for violating the new regulations ranges from $1,000 to $10,000.

 

Adam Leitman Bailey, P.C.

NEW YORK REAL ESTATE ATTORNEYS