Saga at 143 Ludlow: Converting Apartment Numbers to Erase Rent History

Posted on: November 27th, 2012 at 6:09 am by
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143 Ludlow Street is a textbook example of how some landlords try to deregulate buildings for the purposes of luxury conversion. You’ll recall that new owner Samy Mahfar purchased the six-story tenement over the summer and is purportedly amidst such a changeover, resulting in a hellish situation for about eight holdout tenants. Notwithstanding the apparent negligent asbestos cleanup, questionable interior demolition tactics, collapsed ceilings, and suspected DOB shenanigans, there’s also more subtle action at play to help expedite market rents for newly vacated units. Sly would be the appropriate word here, really.

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Something so seemingly innocent as changing the apartment numbers, which, we are told, recently transpired inside 143 Ludlow, actually carries overreaching repercussions. By allegedly fudging the address system, the rent history of that particular apartment is essentially erased. Moreover, the Division of Housing and Community Renewal (“DHCR“) has no way of tracking the shift, so when a new tenant checks said history of their new digs, the updated number is not completely in the system. Market rate then follows.

For instance, say someone moves into #21 – now 6A – which previously carried $500 rent. The maximum increase is the 20% vacancy and then some tiny percentage for each year over 8 years – maybe 5% max. In this scenario, that brings the rent to $625-ish for the next tenant, unless there are improvements. To raise the rent to the $2,500 threshold for destabilization, landlords would need to put enough in it to raise the rent $1,875 legally. If there were improvements while the apartment was vacant, the landlord of a twenty-unit building can apply an additional adjustment of 1/40 the costs.

Therefore, to obtain such a large increase toward deregulation, there would need to be upward of $75,000 in costs (40 x 1875). No such estimate resides with DOB for any renovations at 143 Ludlow. So altering the door number effectively eliminates the issue completely, and a new occupant would have no idea. DHCA records would only go back a year for 6A.

Here is the conversion grid of apartment units by floor at 143 Ludlow. Be sure to check the rent history!

2 = not marked

3 = 2a
4 = 2b
5 = 2c
6 = 2d

7 = 3a
8 = 3b
9 = 3c
10 = 3d

11 = 4a
12 = 4b
13 = 4c
14 = 4d

15 = 5c
16 = 5d
17 = 5a
18 = 5b

19 = 6c
20 = 6d
21 = 6a
22 = 6b

This shady tactic is not exclusive to 143 Ludlow, but the building is simply a microcosm of a larger problem on the Lower East Side as whole. The systematic deregulation of so-called affordable housing.

Have any similar stories? Drop us a line and tell us!

Further reading:

NYC Rent Guidelines Board
DHCA website

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