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Stuy-Town Ruling Could Have Ripple Effect

NEW YORK CITY-Although only a few thousand rental apartments citywide are directly affected, REBNY's Spinola says the decision is 'devastating.'

By Paul Bubny | Updated on October 22, 2009

NEW YORK CITY-Compared to the 2.1 million-plus units of rental housing citywide, the number of apartments–and landlords–directly affected by Thursday’s Court of Appeals decision on the Peter Cooper Village/Stuyvesant Town complex is small. Steven Spinola, president of the Real Estate Board of New York, says his association estimates there are about 5,000 apartments in addition to the 3,000 at Stuy-Town that have gone through luxury deregulation while also receiving J-51 tax benefits. But Spinola and others say there could be wide-reaching implications from the high court’s ruling.

“This is clearly a devastating decision,” Spinola tells GlobeSt.com. “It’s going to have a dramatic effect on people looking at whether to invest in residential property or upgrade the properties. It puts a chilling thought into the minds of every investor, financial institution and building owner that a court can come in and change the rules.”

When Roberts vs. Tishman Speyer Properties was argued before the state’s highest court last summer, REBNY filed a letter to the court in support of the state Division of Housing and Community Renewal’s opinion that former owner MetLife and the current ownership, a joint venture of Tishman Speyer and BlackRock Realty, acted properly in raising rents on deregulated units while getting J-51 benefits. “We believe that the DHCR made the right interpretation, and that you do not change the rules in the middle of the game,” Spinola says.

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