On Thursday, it came to light that nearly 10% of New York City’s rent-stabilized properties are in disrepair. Landlords argue that the rent freeze proposed by Mayor Zohran Mamdani could exacerbate the problem by making it more challenging to maintain these units to standard.
The Rent Guidelines Board of the city convened for the first meeting of the year, where they announced plans to likely approve the rent freeze in May. This move is a crucial part of the democratic socialist mayor’s campaign agenda.
During the meeting, Brian Hoberman, the co-research director of the Rent Guidelines Board, reported that 9.2% of the rent-stabilized buildings are currently considered distressed. This figure shows a slight decrease from last year’s 9.3%.
Hoberman highlighted a historical perspective, noting, “Back in 1990, 13.9% of stabilized properties were labeled as distressed. This number dropped to a low of 4.9% in 2016.”
“However, distress rates began to climb again, reaching 9.8% by 2022, and have since decreased to 9.2% over the past two years,” Hoberman added.
He further explained, “Revenues typically surpass operating costs, allowing for mortgage payments, property improvements, and pre-tax profit.”
But Christine Smyth, an owner representative on the board who was appointed by former Mayor Eric Adams, argued the financial state of these buildings was much more dire.
“We can’t just look at that mean or median numbers that’s going to not tell us what’s going on at the tails,” she said, noting that the COVID pandemic hurt landlords so badly, that they are still just breaking even.
The tally only includes nearly 18,000 of the 50,000 buildings since ones with 11 units or fewer are not required to report finances to the city.
The distressing stat comes after Mamdani campaign that was based around freezing the rent for New Yorkers is stabilized apartments.
The board is set to cast its first vote on the freeze in early May.
Former Mayor Bill de Blasio’s administration froze the rent three times during his tenure starting in 2015 â just as the percentage of distressed properties started to tick up each year.
De Blasio heralded the board’s decision in 2017 after the two consecutive rent freezes, saying, “Iâm very proud that the board made that decision.â
âThatâs never been done in history before,” he said, adding, âThat happened under this administration because I instructed the Rent Guidelines Board â I name the members â and I instructed them to not follow the biases of the past, but be respectful of the needs of tenants and not just the needs of landlords, and look at all the facts.”
