Landlords call him “the devil.”
Meet Arthur Atlas, an architect specializing in loft design. He earned this disparaging title as a result of his work with tenant advocacy groups, and a lifetime of finding loopholes within the city’s convoluted property laws. Currently, Atlas is helping a man who lives on the roof of a building in a small, prefabricated home. The man has water and a kitchen — amenities he built up himself. “It’s a great place,” Atlas said, “but it’s on the friggin’ roof.”
Since the building changed hands, the roof-dweller has felt pressure from the powers that be. He solicited Atlas’s help to legalize the unit. “He can be legal. He can live on the roof,” Atlas said.
Atlas told me this at City Bakery in Soho, where he lives just a few buildings down the block in a 2,500-square-foot loft he has been renting for the past 38 years. His current monthly rent is $897. Meanwhile, his downstairs neighbor, who rents a loft twice the size of his, pays $15,000 per month.
This scenario is possible — and legal — because of the Multiple Dwelling Law, a.k.a. the “Loft Law.” Atlas called the law “insanity,” because it “does stuff that no other law I know of does,” he said.
But with a March 11 deadline looming, tenants of illegally converted commercial buildings have less than a month left of the original six-month window to get protected by the law — and many of them don’t even realize it. Even those who are aware of the deadline are struggling with the idea that the law might be a double-edged sword.
What’s so unique about the Loft Law is that it protects tenants, while also privileging them with certain rights that are usually only afforded a landlord. A tenant who registers his or her unit under the loft law is granted practical immunity from eviction, as well as the path toward rent stabilization, while the landlord is required to take steps toward legalizing the building. However, the tenant is also actively involved in this process of legalization — he or she sits with the landlord, as well as with the other tenants who have registered, to determine the best course of action toward bringing the building up to code. Finally, the tenant is also involved in the cost of compliance; though it is not usually an even split, both tenant and landlord are responsible for financing the building’s renovations, including common spaces and commercial space.
Only once the landlord has achieved a series of steps toward compliance, referred to as “milestones,” can the landlord receive certain increases in rent. In the case of Atlas, since it took his landlord 15 years to bring the building up to code, his rent remained unchanging until then.
The Loft Law was originally passed in 1982, around the time that many artists and creative professionals illegally residing in unlawful lofts around Lower Manhattan were being threatened with eviction. Mass demonstrations and rallies in and around SoHo brought the issue to public attention. And then there was the bad press.
“There was an instance where a guy fell down the elevator shaft and died. There was an instance of a landlord chasing a tenant down the street with a fire axe. Another where a landlord had a bunch of guys show up in the middle of the night and chop up the boiler in the building so there couldn’t be any heat. It was getting very, very nasty,” Atlas said.
The law is a remedial law, passed to remedy the potentially hazardous situation of tenants living in illegal loft buildings that were initially used for commercial purposes. When manufacturing moved out of city, the artists moved into these vacant spaces. Many of the units were stripped and lacked the amenities of a standard residential unit: water, a kitchen, heat. Like the man on the roof, the tenants figured it out. They built their own walls; they installed kitchens and bathrooms.
Now, a new generation of loft dwellers, inhabiting not just Lower Manhattan but also Brooklyn, Queens, and the Bronx is dealing with an updated version of the law. Passed in 2010 and again amended in 2013, the new law seeks to remedy a similar situation that covers a larger swathe of NYC territory.
On a Monday night in late January, dozens of people packed inside The Brooklyn Rod and Gun Club, a tiny bar with a homemade feel in Williamsburg, where New York City Loft Tenants (NYCLT) was holding one of its bi-weekly housing clinics. NYCLT is a tenants advocacy group comprised of loft tenants who volunteer their time to educate other loft dwellers about the 2010 Loft Law before the March 11 deadline.
It was a mostly young crowd, with just a few older folks in the mix. All eyes were on the featured speaker Bob Petrucci, who stood up front. Petrucci is an attorney who specializes in these loft cases, and who was also involved in the writing of the original law. In fact, he became interested in pursuing law and applied for law school only after he fought his own loft case.
Multiple flyers were passed around, some of which detailed the many complexities and stipulations of the 2010 Loft Law, which is a dense, nearly 13-page affair. Many of the specific prerequisites that characterize the law did not exist within the original version. Among these rules: tenants must have lived in their unit on June 10, 2010 to be eligible. In order for the unit itself to qualify, it must have been occupied by someone — not necessarily the resident applying — for 12 consecutive months from 2008 to 2009. Then, there is a slew of other qualifications: The unit cannot be a basement or cellar; it must have at least one window that faces out onto a street, legal courtyard, or yard; it must be accessible without having to go through someone else’s space; it must be at least 400 square feet; and it must be primarily residential.
Petrucci talked through the details of the law, and the floor was opened to questions. A couple was surprised to find that they technically did not have to pay rent for the illegal loft in which they resided because without a Certificate of Occupancy, their landlord has no right to collect.
Some voiced concern at the fact that they had established an affable relationship with their landlord. By applying for protection under the law, they would be calling attention to the illegal status of the building and compromising that landlord-tenant pact.
In a later interview, Heather Troy, a graphic designer who volunteers her time as a community organizer for NYCLT, said, “Generally, people don’t want to get into fights with their landlord. Most people feel like they have a good deal, they have an understanding. Why rock the boat? I have to remind them that that it’s hard but this is your home so you feel sentimental about it. For your landlord, it’s a business.”
Once loft tenants have applied for protection, it’s illegal for landlords to evict or harass them over the filing.
But landlords also end up benefitting from the law. For one thing, they no longer incur the many violation fees that come with owning an illegal building, which have been hiked up from $1,000 to $17,500. And, Atlas said, “At the end of this whole process, the landlord has a legal building with a certificate of occupancy, which means he can go to a bank and refinance the building. And they make out pretty damn well with that.”
According to advocates like Atlas, the Loft Law is important for two key reasons: Firstly, bringing these buildings up to code is in the public’s interest just in terms of safety. And secondly, the law has preserved a kind of housing stock that is essential for people who make art — people who aren’t in a higher income bracket, and who cannot afford a studio apartment. For many, these lofts provide space not just for living, but also for work.
“This law is an opportunity for them to gain some sort of stability,” Atlas said. “They can stay in their lofts as long as they want. Once their rent’s stabilized, it’s in perpetuity. Their kids can inherit the loft and stay rent stabilized.”
Once the unit is registered with the Loft Board, the rent reverts to the rate it was on June 21, 2010 (the date the law was expanded) with fixed-percentage hikes once each milestone is achieved. The first of these milestones is a “narrative statement” — a plan that describes building plans in plain language, for which the landlord is entitled to a 3 percent rent increase. Once the Department of Buildings approves the plans and pulls the permit, the landlord is entitled to an additional 3 percent increase. Finally, once the building is up to code and receives a Temporary Certificate of Occupancy, the landlord can receive the final 4 percent increase.
While the landlord pays these costs up front, once the building is brought up to code, they can request a percentage of the costs back, which tenants are required to pay over the next 10 to 15 years.
In January 2012, Troy and her neighbors decided to register their Greenpoint loft building, which is still undergoing the coverage process. She noted that she is on good terms with her landlord.
According to Troy, the city is probably already aware of the illegal status of these buildings, and it could be just a matter of time before they evacuate them.
But Petrucci suggested that the city is not quite so proactive. “Basically, the policy is that unless there’s an immediately hazardous condition, they’re not going to vacate a building. They’ll issue violations but the city does not actively go after the people unless there’s a very dangerous situation in the building,” he told me in a later interview.
Take the infamous “McKibbin Dorms” of 248 and 255 McKibbin Street, two former garment factories turned graffiti-covered loft apartments, best known for their raging parties, bed bug infestations, and once, even an FBI raid. Even these buildings, which have received a combined tally of 95 violations, according to Department of Buildings records, have yet to be evacuated by the city. Still, Petrucci insisted that anyone eligible for protection should apply, and Atlas separately agreed.
According to its annual report, the Loft Board received 349 coverage applications from tenants in 149 buildings since the 2010 expansion of the law.
“It makes no sense for them not to register,” Atlas said. “They’re thinking, ‘Maybe I’ll just slide through this and I won’t have to register…’ No, either the city’s going to nail them or the landlord’s going to nail them.”
The Application Process
Applying for coverage under the Loft Law can be a laborious process. Like Atlas’s building, the process takes years. According to the NYCLT, it is unlikely that it will take less than three to five years to reach the final milestone, and a lot of buildings take much longer.
Each and every one of these cases must appear before the Loft Board, a committee comprised of nine members: the chair of the board, who is the commissioner of the Department of Buildings; four mayoral-appointed public members; one tenant representative, one landlord representative, and one manufacturing representative; and a representative from the fire department.
Of the 900 buildings that applied for coverage under the original law, 300 have still failed to meet building code, a fact Atlas called “scandalous.” A number of factors can contribute to the delay — among them, the regular bureaucratic logjam, conflicts between tenants and landlords, as well as a shortage of city officials available to make building inspections.
A representative of the management at 16 Cypress Avenue, a four-story Brooklyn loft building, said that he was forced to register his building under the loft law in 2010, and his building is still nowhere near first base in the permit process.
“We have to hire an architect who can measure every inch of every unit to file plans,” he said, declining to give his name. “Then you get a 45-minute slot with the building examiner to go over plans. He had over 40 objections to our plans. The problem is that the city doesn’t have enough building examiners for each building. We have to wait at least six weeks to have a meeting and when we do, it’s 45 minutes. It’s already going on three years, and I’ve spent more than $100,000. It’s incredibly long and frustrating.”
In spite of all this, he said, “I think it’s a good law. It protects the tenants as well as the landlords.”
Though no official tally exists of the buildings now eligible for the updated law, NYCLT counted around 300 buildings that qualify in Brooklyn, although they estimate that many more exist. Not to mention those out in Queens and the Bronx.
For the city, the loft law poses a real administrative inconvenience — paperwork, inspections, and court cases. “The city administrates the process of legalizing these buildings and it’s a budget item and it’s a personnel item and they just want it to go away. They don’t want to deal with insanity,” Atlas said.
No one really wants to deal with the insanity — perhaps least of all, the tenants, many of whom work in the creative sector, and have spent much of their lives avoiding that very tangle of bureaucracy and government.
“When I first heard about this,” Troy said, “I was very, very reluctant to get involved because who wants to invite lawyers and government officials into your home, into your bedroom, telling you what needs to be done, that the space might entirely change in order to become legal? Who wants to get involved in that?”
Still, Troy assured me there is indeed a light at the end of this tunnel. And Petrucci, who sees a lot of these cases, said that most people who are eligible and apply for coverage, eventually do get coverage.
But the gripes with the city don’t stop there. Referring to her work with NYCLT, Troy said, “We don’t feel that the city has done enough of community outreach. We don’t feel that they have advertised the deadline. So there’s a very tight core group of us and then there’s a lot of loft tenants that need support.”
The “G” Word
The real reason the Loft Law exists dates back even farther than the original 1982 law — well into the ’60s, in fact — when the Department of Buildings implemented an Artists in Residence (AIR) program for creative professionals to live in commercial spaces at lower costs. One of the key components of this program was that each building was limited to a maximum of two residences. Any building with three or more units would be considered a multiple dwelling, and would thereby fall under the Multiple Dwelling Law.
Chuck DeLaney, who has served as the tenant representative of the Loft Board since its formation said, “The minute the AIR program started, people started moving into these buildings like crazy.”
Tenants who lived in AIR buildings were required to put a sign on their windows in big block letters indicating that they were AIR residents, as well as the floor on which they resided. The justification here was that, if there was a fire, the fire department would know where to rescue the people living in these mostly vacant spaces.
That was the case until the Loft Law was passed in 1982. And ironically, those buildings whose landlords broke the agreement that allowed more than two people per loft got coverage under the law. Meanwhile, those landlords who complied, and kept only two residences, were not — and still are not — covered.
Of course, the days of $300 AIR units are long gone. And it is unlikely that many will strike a deal quite as sweet as Atlas did for his Soho loft. In fact most of the tenants currently applying for protection under Loft Law are paying at or somewhere close to market rate.
One anonymous resident of 54 Knickerbocker — the loft building managed by the recently murdered Menachem Stark — told me that she pays $2,600 for her 800-square-foot loft, where she lives and works with her partner. In her case, her landlord had independently registered the building under the Loft Law without notifying the tenants, all the while increasing the rent arbitrarily.
“They’re trying to get more money out of people who just don’t know any better,” she said. “I like living here and I want to stay here. That’s part of the interest in paying attention to what is legal, what the landlord can do, and can’t do. I realized it was in my better interest to educate myself.”
She and her partner have considered moving but they have come to think of 54 Knickerbocker as home. “It’s really hard to talk about because it’s also linked to gentrification and it’s hard to see yourself as part of that, but I think it’s also a reality. I think that’s also why people are interested in holding on as long as they can. At least the Loft Law is letting this happen a little more slowly,” she said.
For these loft tenants, in particular, the issue of gentrification is double-edged. Creative people who come in and make a neighborhood trendy and viable to live in also attract developers. “That’s where Soho came from. That’s where the Meat Market came from, that’s where Tribeca came from. There was nothing there before,” Atlas said.
As the deadline to register is looming, NYCLT has paired up with its predecessor, the Lower Manhattan Loft Tenants, to lobby for an amendment to the law that would either remove or extend the deadline, and change many of the eligibility requirements that are making it so difficult to apply. Though she could not name names, Troy claimed that people in the City Council and State Assembly and Senate have expressed interest in supporting the cause.
“We can’t promise anything yet,” she said, “but we’re trying.”