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Novel plan to save ‘dysfunctional’ former squat

By Adam Leitman Bailey


By: Lincoln Anderson

October 23rd, 2014

The arrest of Rosario Dawson’s cousin on Monday for attempted rape has put renewed focus on the troubled East Village tenement where the famous “Cesar Chavez” actress grew up and where her cousin had been living since this summer.

The building is one of 11 East Village squats that were sold in 2002 under the Giuliani administration to the squatters for $1 per building. Under the deal, the squatters were supposed to bring the buildings up to code, then would get to keep their apartments as low-income units.

More than half of the squats reportedly have already become low-income co-ops. But 544 E. 13th St. has lagged way behind, and, in fact — a full dozen years after the historic agreement with City Hall — almost no work has been done to fix up the building to bring it into line with proper city building codes.

The tenement is sharply divided between two factions: the Dawson clan and its allies on one side versus another group that claims some longtime tenants. One of them, African graphic artist Alfa Diallo, was among a group of several pioneers who originally “opened up” the formerly abandoned building, whacking cinderblocks out of a closed-up doorway with a sledgehammer to gain access.

The non-Dawson faction charges that Isabel Celeste — Rosario’s mother — and her family members basically run the building as if they own it, and have aggressively taken over units, and have also impeded efforts to fix up the place to bring it up to code.

Former common spaces, like a basement bicycle-storage room, have been taken over and are now being rented out for profit.

In June 2013, Celeste — without permits — drilled a hole in her first-floor apartment’s floor, then installed a spiral staircase down to a basement space to create a duplex for herself. Alerted by other tenants who were concerned about vibrations from the construction, firefighters arrived, resulting in a partial-vacate order being issued after unsafe conditions were found, including a partially detached rear fire escape and a leaning parapet.

Tenants also complain that essential services — including heat, gas and hot water — are nonexistent. Tenants use hot plates to cook and to heat up water for bathing, and electrical space heaters in the winter to keep warm. After at least two winters — the last one particularly brutal — without heat and hot water, they are not looking forward to another.

Celeste did not respond to a request for comment.

Attorney Adam Leitman Bailey was retained by Celeste and her faction during the past year. Two months ago, he told The Villager he was fighting a tax-lien foreclosure on the property, which he assured they would defeat.

Speaking on Monday, Bailey said the foreclosure effort has temporarily been put on hold.

Stressing that he is a real estate lawyer, Bailey said he isn’t representing Juan Scott, Dawson’s first cousin who is charged with attempting to rape a woman in a Stuy Town elevator last Friday, plus two other prior East Village sexual-abuse incidents.

Bailey said he met Scott at a meeting of what the attorney called the “homesteaders” — since the Giuliani deal, they’re technically not squatters anymore, he noted — over this past summer.

“I met him once,” the attorney said of Scott, 26. “He was sitting in the corner. I saw no predilections toward someone who would disrespect a female. Nice guy. Respectful. Quiet. But then again, I only saw him once.”

As for the building’s future, Bailey said he is, in fact, currently working with the city’s Department of Housing Preservation and Development and the Urban Homesteading Assistance Board, or UHAB, on a way to get the E. 13th St. building fixed up and put into one of Mayor de Blasio’s new affordable housing programs.

Under the 2002 deal with the city, UHAB was basically supposed to shepherd and assist the squats on their way to conversion into low-income co-ops. But Bailey said UHAB never paid any taxes on the E. 13th St. building, which is what triggered the foreclosure effort.

“The City Council appointed them the owner until our clients were deemed ready to take ownership,” he stated of UHAB.

According to Bailey, the new plan would involve a “white knight developer” who would invest money into the building — to the tune of $108,000 per unit — in return for which the developer would get a bonus of floor-area ratio (F.A.R.) — in other words, additional square footage — that he could use at another site to develop market-rate units. This would be done through creating a “comprehensive zoning lot,” with the market-rate portion possibly located nearby or elsewhere within the neighborhood.

The details are still being hashed out, and the developer’s investment might wind up being less than $108,000 per unit by the time negotiations end, since otherwise the total would be a pretty high sum, and possibly more investment than the building needs, Bailey said. There would be “a covenant running with the land,” so that the units would be permanently affordable. The deal could be finalized as soon as a month from now, Bailey said.

According to a source, BFC Partners, led by managing partner Don Cappocia, is the developer trying to swing this “inclusionary zoning” deal involving 544 E. 13th St. But Bailey said he could not confirm that.

Actually, this program could work out better in terms of affordable housing than what was done with the other former squats, the attorney indicated. Namely, the other legalized squats actually could convert to market-rate status in 30 to 40 years, once their mortgages are paid off, Bailey contended.

Setting it apart then, under the new deal, all the units at 544 E. 13th St. would be affordable in perpetuity.

About two weeks ago, a UHAB representative toured the building. It’s been hard to get answers from UHAB, though, on exactly what is going on with 544 E. 13th St. and if it will ever become a low-income co-op.

Bailey denied that Celeste and the Dawsons are the problem, and countered that the building is well-run.

“We represent some of the richest, most exclusive buildings in the city,” Bailey said of his law firm. “This board [at 544 E. 13th St.] is as good as any building I’ve worked with, and they’re working really hard on it, using their own sweat equity and money [to rehab the building]. I’m impressed with it. … To me, there’s no civil war. I know that Isabel is trying to fix the building. I think that they deserve medals, not to be crapped on.”

If the place isn’t as far along as it should be, then it’s all UHAB’s fault, he said at one point, stressing that the nonprofit was appointed the squats’ owner until the buildings were ready to convert to low-income co-ops.

Bailey, in turn, also blasted Annie Wilson, Diallo and other longtime former squatters who are not allied with the Dawsons — “Annie and her minions,” as he put it — saying they are really the ones standing in the way of progress.

“Annie does not contribute anything positive to the building,” he charged. “She actually should be evicted.”

Asked who exactly is footing the bill for his high-priced law firm’s services, Bailey just replied that it was “people” living in the building, and said he couldn’t be more specific.

For her part, Wilson was galled at the idea of the former squat — with all that it stands for — potentially now being used to help boost the bulk of a new luxury residential project in the community.

“It makes me sick,” she said. “It’s the irony of the matter.”

Rosario Dawson, due to her success, is a role model, and her mother is well known in the community and is involved in charitable causes. Councilmember Rosie Mendez said she knows Celeste and likes her.

“Whatever he has done,” she said of Scott, “you can’t impute that to Rosario, her mother, his father or anyone else. You can’t impute any bad actions to the building either. As far as I know, Rosario is not involved in any of the building issues.”

Adam Leitman Bailey, P.C.

NEW YORK REAL ESTATE ATTORNEYS