News Release: New York Co-op Apartment Owners Are Seeking Fairness, Stability and Affordability During Housing Crisis

  • May 7, 2024
  • Press Releases

Grassroots Coalition Day of Advocacy Urges Action on Passage of Krueger/Rosenthal Legislation

Advocates representing more than 25,000 New Yorkers residing in ground lease co-op apartments traveled to Albany today to urge state lawmakers to act on legislation providing basic tenant rights and consumer protections from threats to their homes when long-term land lease provisions expire. The legislation is modeled after similar measures signed into law in 2019.

The diverse group living in Queens, Kings, New York, Bronx and Westchester counties, has been working with key legislators to raise awareness and underscore the urgency of this matter during the 2024 legislative session.  For some co-op owners, their homes are in jeopardy, as existing ground lease terms sunset in 2025.

Ground leases, which are circumstances where the land upon which a building sits is not owned by the residential occupants but rather by a third-party landlord such as co-ops and those living in manufactured homes. When leases expire, some of which were established decades ago, the co-op apartment owners may be required to pay exorbitant rents, forced to accept additional threatening conditions or face eviction from their homes. More than 10,000 ground lease apartments have been identified as part of the advocacy effort. The majority of ground lease co-op apartments are located in the outer boroughs. Approximately 40 percent of the apartments are located in Queens – the most of any county (4,718).

Earlier this year, identical bills (S. 7825 and A. 5031A) were sponsored by Senator Liz Krueger and Assemblymember Linda Rosenthal. In addition to the prime sponsors, the measure has 11 co-sponsors in the Senate and 26 in the Assembly.  The Senate Judiciary Committee has approved the measure, and the Assembly Housing Committee is expected to act on it shortly for action in both houses prior to the close of legislative session on June 6.

“The housing crisis is being felt in every corner of the state. As we work to protect hardworking tenants and homeowners, our efforts must include granting protections to the more than 25,000 New Yorkers living in ground lease co-ops,” said Assemblymember Linda B. Rosenthal (D/WF-Manhattan), Chair of the Assembly Committee on Housing. “Throughout the five boroughs and the downstate area, thousands of people are living in ground lease co-ops, owning their apartment but not the land that the building sits on. All too often, when these lease agreements near expiration, residents are shocked to receive an ultimatum of either paying a staggering increase or leaving their home behind. People who bought into the American dream of owning their home should not be left in this precarious position, especially as we work to expand access to affordable housing for all New Yorkers. As we enter the final weeks of this legislative session, it is imperative that we pass my legislation to protect the rights of ground lease tenants and keep them in their homes.”

“Ground lease co-op residents deserve basic protections against displacement and abnormal market conditions that have left them with limited negotiating power,” said Senator Krueger, Chair of the Senate Finance Committee. “In order to preserve the homes of tens of thousands of middle-income New Yorkers amidst an escalating housing crisis, ground lease co-ops must have the right to renew their leases with reasonable rent increases, the ability to borrow funds for safety related projects, and the right to purchase the land if an owner chooses to sell.”

Michael Tang, a six-year resident of a ground lease co-op located in Queens, said: “My neighbors love living in the Flushing area, the vast majority are senior citizens who have built a life in the community – their families live nearby. They embrace the cultural diversity, and value the access to the Long Island Rail Road and subway. They support the ground lease legislation because it addresses an important and ongoing issue – the ability of co-op owners to borrow for repairs, maintenance, and capital improvements. In other cases, for those who may be seeking to sell a co-op because their family is growing, the transaction and market is limited because many banks are unwilling to provide mortgages to those seeking to purchase a co-op containing a ground lease.”

Carol Brooks, a 27-year resident of a ground lease co-op also in Queens said: “For nearly three decades, I have lived in Far Rockaway just about a mile from the beach. Our ground lease co-op is comprised of 72 apartments – and the biggest concern my neighbors share is the inability to sell their units because banks are unwilling to finance the purchased due to the ground lease – or the fact that potential buyers are unwilling to pay what the current owner believes to be a fair value relative to their investment or comparable properties in the area. A former president of the co-op board, Norman Silverman, now in his 80s recollects that when he approached the land-owners years ago about purchasing the land, he was told to ‘pound salt’.”

Jennifer Wagner, a 22-year resident of a ground lease co-op in Kings County, said: “I work as a school secretary, and am a single parent. I raised my children at the Sheepshead Terrace Co-op in Southern Brooklyn. It contains 168 units. My son, now in his early 20s is autistic, and when I purchased our apartment, it was my intention for it to provide the kind of stability we could all depend on into the future. However, the land has been sold multiple times, and when the co-op board reached out to the new owners we were largely ignored, and when our representative did finally connect with the owner – we were told they were unwilling to discuss a potential renewal or purchase by the co-op owners of the land. We could potentially be left with nothing.”

Louis Grumet, a resident of a ground lease co-op located in Manhattan, said: “When I retired, my wife and I purchased an apartment after moving out of our long-term home north of the city. I was disabled and found the building appealing because it was barrier free, due to our limited mobility while also being in proximity to our health care providers and local attractions. Those of us who live in the building are concerned about predictability of our monthly expenses and absorbing the costs when ground lease rents escalate.”

Jane Curtis, of the Building and Realty Institute of Westchester & the Mid-Hudson Region, and chair of the Cooperative and Condominium Advisory Council (CCAC), said: “Cooperative housing is among the most cost-effective homeownership options for New Yorkers seeking secure and affordable housing. The proposed bill would offer an additional layer of security and predictability for co-op residents who may struggle with rent increases on the ground lease that must be borne by all shareholders, including those on a fixed income. Furthermore, some looking to move into a co-op are already beginning to face challenges in obtaining standard 30-year mortgages due to banks and lenders finding ground leases to be unpredictable. At a time of severe housing shortage, ruinous ground lease renewals pose a threat to some of the only affordable homeownership opportunities in the NY Metro area. Passage of S7825 and A5031A will prohibit these predatory practices, stabilize the market for co-op mortgages, and restore financial stability to those co-ops affected.”

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To learn more about the Ground Lease Coop Coalition contact: Info@GLCoopCoalition.org or visit https://GLCoopCoalition.org. The Ground Lease Coalition is represented on media relations matters by Corning Place Communications. Please contact Paul Larrabee at 518.491.7577 or PLarrabee@corningplace.com for additional assistance.

  • Housing Crisis | Tenant Protections

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