In this morning’s New York Times, columnist Michael Powell describes an “absolutely smashing real estate play,” a Midtown investment company’s “repositioning strategy” at 61 Delancey Street, a six-story tenement building. According to Madison Capital’s own web site, this strategy involved “releasing vacant retail units and 45 rental apartments and the renovation and releasing of under market residential apartments.”
Tenant Zhi Qin Zheng, who has raised two children at 61 Delancey, tells Powell what this “repositioning” has meant to her:
Madison Capital stopped plastering or fixing leaks and cut the heat. It tried to evict her when she was a few days late with the rent and accused another Chinese mother of two of being a prostitute. It called the police when tenants met in the lobby. It installed cameras in the halls and demanded that tenants remove Lunar New Year signs from their doors. Sitting in a tiny kitchen, with a view across Delancey to one of those silver, faux-industrial-style million-dollar condos with rooftop birch trees, Mrs. Zheng, 58, smiles and waves her hand as if to bat away flies. “It is battles all the time here; lots of people are leaving,” Mrs. Zheng says through an interpreter. “I know my rights, but I am nervous.”
Powell describes the rapid gentrification occurring in the neighborhood, writing “wealth laps on every shore.” What could be in store for this building? Powell notes that Madison bought 55 and 61 Delancey three years ago for $20 million (more than twice what it sold for five years earlier). Once rent regulated residents are forced out, new market-rate tenants are paying around $3,000 per month. But it seems the math is not quite adding up:
To turn a profit, analysts say, Madison needs a minimum of $6,500 per apartment. Which leads suspicious souls — I plead guilty — to suspect Madison’s real long-term play is to demolish the tenements and build one of those blue-glass condos where no one ever thinks of putting up a curtain. The inevitability of rapid change feels overpowering.
This morning, CAAAV-Chinatown Tenants Union, a local advocacy group, organized a protest at Madison Capital’s Midtown offices. In a press release, CAAAV noted that the battle between residents and 61 Delancey’s landlords has been raging long before Madison was in the picture:
The tenants at the two buildings have a long history of organizing against displacement. The previous landlords – Michael Daniel, Nir Sela, and 55 Delancey Street Realty LLC – bought the buildings in 2001 and proceeded to also evict rent-stabilized tenants. In 2007, after a rent strike and protests organized by the tenants and by CAAAV-CTU, the tenants won significant concessions.
It remains to be be seen how much longer the tenants will be able to hold out.
Madison Capital did not return multiple phone calls from the Times.
As a lifelong resident,I think it is a shame how long time residents are harassed in favor of greedy Developers and Landlords.This neighborhood has become nothing short of a playground for the well to do Yuppies and trust fund kids.