The extraordinarily significant Stuyvesant Town lawsuit now pending in New York State’s highest court has been quick to galvanize opinion in a familiar divide, pitting advocates of affordable housing against rent-hungry landlords. With the fate of rent regulation rules at stake in the 13,000-unit apartment complex, many elected officials have publicly backed the tenants’ position—hailing an earlier court ruling in their favor as “a victory for the City”—and all the landlord groups have been loudly supporting their members.
Both sides have dumped amicus friend of the court briefs on the Court of Appeals, which last week heard arguments in the case, with each offering many a justification for their respective side. And for good reason: If an appellate court ruling is upheld, it could mean landlord Tishman Speyer would suddenly owe an estimated $200 million-plus in back rent, re-regulating over 3,000 market rate apartments at substantially lower rents. Other landlords, too, would owe back rent, estimated by one landlord group at a total $1 billion.
But underlying this fight is an irony too large to ignore: the biggest beneficiaries of a landlord defeat would be people who apparently don’t need affordable housing at all: the hundreds of millions in back-rent would go to tenants paying market-rate rents—the $3,300 for a two-bedroom renters who came in after their previously rent-stabilized apartments were deregulated. Subsequently, all of those 3,000 or so units would stay rent stabilized, guaranteeing a major decrease in rent to those who had previously been forking out the big bucks (depending on the apartment, it would mean hundreds of dollars, if not more than $1,000 off per month).
Of course this isn’t a point that’s all that relevant to the arguments of the case, which is not about the morality of regulated rents. Rather, the suit, Roberts v. Tishman Speyer Properties, is a question of whether or not a landlord was allowed to deregulate apartments. The lawyer for the tenants, Alex Schmidt, argues that the landlord was, by law, barred from taking any units out of the rent-stabilization program while it received a modest subsidy to encourage renovations.