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Landlord Seeks Demolition, Argues Buildings Aren't Profitable

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On the Upper East Side, barbs have been traded for the last few years between landlord Stahl Real Estate and its tenants at two six-story walk-ups on York Avenue between 64th and 65th streets. But tomorrow's Landmarks Preservation Commission hearing (warning: PDF) could put their battle to rest. Since 2011, Stahl has claimed that these buildings?designated landmarks because of their social and historical significance as some of the first progressive affordable housing blocks, which used a courtyard and windows in every room to make small units feel more livable?are costing it millions, and that it will not be able to find tenants to pay $1,235 a month for the units, resulting in an atypically high vacancy rate for the neighborhood. Stahl is essentially claiming that, even if it performs much-needed renovations, it won't be able to earn the city-mandated minimum of a 6% profit off of the 190 studios, one-bedrooms, and two-bedrooms at 429 East 64th Street and 430 East 65th Street. Along those lines, it has filed a hardship application with the LPC that, if granted, would allow Stahl to tear down the buildings and replace it with something more profitable.

Executive director of the Friends of the Upper East Side Historic Districts, Tara Kelly, is one of the opponents to Stahl's hardship application, arguing that Stahl is looking for any excuse to demolish these buildings in order to build a more conventional high-rise. The first tactic, she recounts, was to try to get landmark status taken away from the buildings, which was successful until it was reinstated in 2006 with messy arguments over the designation that were finally resolved in 2010?not before Stahl had replaced 1915 structure's Beaux Arts facade (below) with some ugly pink stucco (above).

Kelly and others also hold that Stahl has been purposely neglecting upkeep for the apartments and the buildings in general, keeping the rental office inaccessible, not removing scaffolding, and taking other measures to make living there undesirable or difficult. (Stahl has plead guilty to some of these accusations.) Since the hardship plea was first made in 2010 and since the last hearing on the matter in 2012, the LPC itself has queried Stahl about the details of its financial situation and its projections for the building, with Stahl responding via extensive, legalese-filled documentation that it'll take a $17 million renovation (about $52,000 per unit), to get the apartments shipshape enough to charge an average of $1,235 in rent, and that it still won't find tenants.

"If this were true, why did the last tenants who lived in these warehoused apartments pay far in excess of that dollar amount?", writes UES resident Monica McLaughlin in an open letter to the LPC, accompanied by a chart of rents at 26 of the units in the buildings, all of which are over $1,000/month. Last year, in fact, Stahl claimed that it could only charge $600-800 for the very same units and still couldn't lure tenants.

In addition, a study commissioned by Kelly's group shows that the units could rent for an average of $1,500 per month and the building could generate an annual return of 11.7 percent. Regarding Stahl's efforts to prove the buildings aren't economically viable, Kelly adds: "There are hundreds and hundreds of pages [filed with the LPC] that I do believe is intentionally confusing in order to achieve their ultimate goal of demolition." Hardship applications are actually quiet rare, and successful ones all the rarer, so let's find out if Stahl succeeds; the hearing is tomorrow 2:15 p.m.
· Owning Is a Hardship If Units Left Vacant, Asked Rents Low [Curbed]
· Landlords Trying to Make Landmarks Less "Landmarked" on the UES [Curbed]
· Un-Landmarked Landmarks Get Their Status Back in Court [Curbed]
· Preservation Watch archive [Curbed]

429 East 64th Street

429 East 64th Street, New York, NY