A property, in fact, can be deregulated following a substantial rehabilitation, but it must meet certain specific requirements under the law. Just handing out a so-called free-market lease does not make an apartment market rate.
Credit
Jonathan Santiago for The New York Times
Mr. Giddings told me in an email that “the previous owner filed” an application with the Division of Housing and Community Renewal, the state agency that oversees rent-stabilized properties. But he did not say if the state ever responded. Tenants requested their rental histories from the state, which showed that the building is rent-stabilized, said Courtland Hankins, one of the tenants.
“Something fishy happened a long time ago,” said Stephanie Rudolph, a staff attorney with the Urban Justice Center, who reviewed details of the property with me but does not represent the tenants. A 2005 permit for renovations to bathrooms and kitchens filed with the city Department of Buildings, for example, “doesn’t look like it was enough” to meet state requirements for deregulation. “My assumption would be that they never did any of the paperwork” with the Division of Housing and Community Renewal, she said.
This spring, the state housing agency informed tenants that it was reviewing an application from the new owner to determine if the property was exempt from rent-stabilization. Tenants plan to challenge the landlord’s claim.
Despite earlier improvements, some apartments have pipes and windows that leak, broken floorboards and missing bathroom tiles, crumbling paint and plaster, kitchens with no cabinets and faulty electrical wiring, according to dozens of photographs of seven apartments provided by tenants.
In emails, Mr. Giddings described the building as a well-maintained property that had been gut renovated. He said he had no immediate plans to raise rents and dismissed complaints from tenants as overblown. “We have mentioned to some tenants that there will be legal rent increases at some point,” he wrote. “But we have not pushed that issue.”
Tenants, however, are anxious.
A $500 rent hike could undo the lives of tenants like TaraMarie Capozello, 37, a single mother of two daughters who moved into the building from a homeless shelter in 2007. She pays $962 a month, with rental assistance from the city, and still struggles to make her payments. She has not had a lease renewal in years. Last January, Mr. Giddings approached her in the hallway, telling her that her rent could jump to $1,500 a month. If that happened, “I’d be done. It’s over,” she said. “I’d be back in the shelter system or out on the street.”
Claudia Waterton, 36, a print production artist who pays $1,050 a month for her studio, commutes an hour and 20 minutes to Brooklyn for work. A substantial rent hike could send her deeper into the Bronx — and farther from her job. “A lot of people are scared to move,” she said. “How are we going to find a place that’s affordable?”
Credit
Jonathan Santiago for The New York Times
These days, whenever a building in the Bronx changes hands, fears of gentrification ripple through the area. Between 2006 and 2015, the median rent rose almost 18 percent, to $860 a month, in Mott Haven and Melrose, an area that includes Port Morris, according to the New York University Furman Center.
In 2016, as asking rents stagnated in other parts of the city, they soared in the South Bronx, rising in Mott Haven by nearly 16 percent from the previous year, to $2,050 a month, according to StreetEasy.
Indeed, after decades of blight and abandonment, developers are now pouring money into speculative investments in the Bronx. The city has taken steps to rezone neighborhoods to spur more residential development, causing angst among some residents who fear that the revitalization of their neighborhoods could spell displacement. The median income in Port Morris and Mott Haven was $20,334 a year between 2010 and 2014, according to U.S. census data. Yet many of the people moving to the borough make considerably more money than that. So if a studio at 700 East 134th Street could fetch $1,500 a month, a sum that a newer tenant would eagerly pay, where can people of more modest means who have lived here for years go?
“In a moment where entire boroughs are no longer options, people are moving to the Bronx,” said Susanna Blankley, the director of Community Action for Safe Apartments, a tenant-organizing group. “People fear that we are facing displacement pressures like never before.”
This block of East 134th Street, a spartan stretch opposite the Bruckner Expressway, has no residential amenities. Yet, it is within a five-minute walk from the Bronx Brewery, the Port Morris Distillery and Gun Hill Tavern, all relatively new businesses in Port Morris, a triangular swath at the southern tip of the Bronx.
“The neighborhood has changed, the complexion has changed. It’s SoBro now,” said Mr. Hankins, 46, a middle school hip-hop teacher who lives in a fourth-floor studio in the East 134th Street building. In two conversations last March, Mr. Giddings told him that his rent could jump from $1,039 a month to $1,650 a month. “In the next four to five years, it’s definitely going to be a little Williamsburg.”
For now, tenants are hastily gathering information about their building’s history, hoping to prove that the building should remain rent-stabilized. Should the state rule in Mr. Giddings’s favor, they worry that overtures about rent hikes will turn into forceful demands, leaving them with few options. If management is “able to get some firmer footing, they’re not going to be soft with us at all,” said Mr. Hankins. “Not one little bit.”
