David Stone
Is Roosevelt Island still a community or an investment opportunity?
Is Roosevelt Island still a community or an investment opportunity?
© David Stone / Roosevelt Island Daily

Opinion: The surprising thing, when RIOC turned a cold shoulder to tenants, this year, was how openly it was done. Same thing with handing out special favors to landlords Hudson Related and Grenadier/Manhattan Park. You don’t have to decipher their motives or guess at why the State agency enjoys immunity from this behavior — or thinks it does — to recognize the damages.

A Silent Slap in Face for Westview’s Taskforce

RIOC’s mishandling of the Affordability Plan negotiated between the Westview Taskforce and sponsor David Hirschhorn wins the contest for worst misdeed if only because — uniquely — RIOC managed to abuse both tenants and landlord.

Nearly a year and half ago, a plan modeled closely on one already approved for Island House, a sister complex with similar dynamics, was put to a vote by tenants and approved overwhelmingly, but when it landed on the table at a RIOC subcommittee, the reception was unexpectedly awkward.

RIOC President/CEO Susan Rosenthal said she hadn’t seen it, a claim disputed by some but startling if true. The plan’s approval was hardly a secret, and it was the primary reason for calling the meeting. Why had she not made it her business to learn about a deal that would seriously impact RIOC’s budget and the community’s welfare?

Another comment by Rosenthal almost sent Taskforce member Paul Lenner out of his chair.

The Westview Taskforce and Hirschhorn, Rosenthal said, failed to keep RIOC or NYS Housing and Community Renewal, ultimately responsible for the Mitchell-Lama program under which Westview is regulated, informed of their progress.

Lenner sharply disputed that claim. In fact, HCR had sat in on some of the conversations and provided guidance.

Board Member Fay Christian, a one time member of the Taskforce, expressed surprise. As she understood it, they’d been assured that, as long as the tenants were happy, approval shouldn’t be a problem.

But under Rosenthal and the current HCR leadership, tenant happiness no longer holds the key to success. In fact, consistent throughout the next year and four months has been apparent indifference toward residents’ concerns.

While Hirschhorn, RIOC and its Board have refused to disclose details about what’s holding up resolution, sources tell us that RIOC’s first response on receiving the approved affordability plan was to virtually crush it by demanding an astronomical increase in lease payments. 

The increase would be passed on to tenants who’d be forced to accept a far less favorable deal than their next door neighbors at Island House.

Nested within this negotiating impasse is RIOC’s space within Westview at 591 Main. RIOC’s occupied it rent free for forty years and, although they spent public money to build new, modern administrative space on the ground level beneath Motorgate and agreed to move into Southtown Building 9 when it’s completed, they’ve balked at paying any rent for their space in Westview.

The ground lease for Westview expires this spring, and there’s an increasing likelihood that Hirschhorn, faced with RIOC/HCR intransigence, will simply remove the complex from Mitchell-Lama without an affordability plan, wiping out a huge chunk of middle class accommodations much like Urban American did in converting Eastwood to Roosevelt Landings.

Veteran Island watchers wonder if RIOC’s actual endgame is to push a frustrated Hirschhorn to sell out to RIOC favorite, Hudson Related. 

Grenadier/Manhattan Park Gets a Free Pass 

Because details became public through articles published here, RIOC couldn’t disrespect Manhattan Park tenants with chilly silence as they did with Westview but instead, with little apparent reluctance, threw resident concerns into the gutter with deceit.

Convinced by research that Grenadier, Manhattan Park’s parent under the Starrett umbrella of tactically arranged real estate alliances, failed to meet terms of its ground lease with RIOC, going back as far as 1989, tenants from the River Road complexes asked a representative (this writer) to approach Susan Rosenthal, then acting CEO for help in June, 2016.

Rosenthal responded, proactively assisting with suggestions for challenging Grenadier, although she deferred getting her legal staff deeply involved because, she said, RIOC lacked resources.

As the tenant group collected information, stories that exposed Grenadier’s alleged misconduct, Rosenthal saw clearly Manhattan Park’s failure to meet ground lease terms conditioning their permission to sub-meter electricity. 

In 1989, A grievance procedure insisted on by the Public Service Commission to protect tenants from abuse had been approved but never “put into play” at Manhattan Park, as Rosenthal put it.

That meant the grievance procedure was virtually erased because nobody outside RIOC and Grenadier/Manhattan Park knew anything about it. 

Challenged, Grenadier was never able to demonstrate that it made any tenant or tenants aware of their protections or that the procedure had been used, even once, in 25 plus years.

2017, A Year When RIOC Screwed Tenants and Cuddled (Some) Landlords
© David Stone / Roosevelt Island Daily

At the same time, tenants offered RIOC multiple examples of incidents in which the procedure should have been activated but never was. Grenadier/Manhattan Park, it was shown, had consistently acted as if the grievance procedure didn’t exist.

There is no way of knowing for certain that sub metering abuses took place, but if not, why deny tenants contracted rights?

The case was simple and easy to demonstrate. Assembly Member Rebecca Seawright and State Senator José Serrano were both looking into the issues.

Then, one day in August, Grenadier/Manhattan Park representatives came calling at 591 Main Street. Suddenly, all support for tenants evaporated.

Later, Rosenthal reported that she’d had conversations with Grenadier/Manhattan Park’s unidentified “principals” and their legal counsel before dumping tenants, their grievances dissed as “conspiracy theories.”

Both Seawright and Serrano disappeared into the woodwork.

It wasn’t until The Daily made a Freedom of Information request in late 2017 that some of the reasons for RIOC’s abandoning tenants began to become clear. 

Paperwork released by the State agency included emails showing Rosenthal misleading Senator Serrano’s representative, Eric Rivera, about details of the complaint. 

Rosenthal rearranged reality, in an email to Rivera, to excuse herself from responsibility in a way that made tenants look like simpleminded whiners. Very likely, she did the same trick to spook Seawright’s staff.

Grenadier/Manhattan Park conduct, of course, continues unchanged and unchallenged by RIOC. 

And the Grenadier/Manhattan Park “principals” she conferred with before icing tenants? RIOC refuses to disclose their identities, a probable violation freedom of information rules.

Why would RIOC want to shield the complex’s owners who influenced her?

That question might be answered, at least partly, by taking a look at a commonality Grenadier/Manhattan Park shares with another favored landlord, Hudson Related, builders of Southtown and managers of Main Street Retail.

Both companies employ former RIOC chief executives.

In contrast, the sponsor at Westview has no displaced RIOC executives in his employ. 

Cozying Up to Hudson Related

Contrast that with RIOC’s treatment of Hudson Related.

It’s a relationship that earned some remarkable benefits in recent months.

In an emotionally fraught September Board Meeting, Rosenthal and Hudson Partner David Kramer teamed up to crowbar approval of a lease amendment giving the real estate giant financial concessions in exchange for building substantial affordability units in constructing Southtown Buildings 8 and 9.

Resident advocates argue that, because Hudson Related is doing only what it’s supposed to do in building affordability into their plans, there is no reason they should be rewarded.

Board member protests involved being pushed hard to approve an agreement they had little chance to review. 

“I'm tired of being pushed,” protested Fay Christian to little avail, after being given only a few days to consider a complicated package.

Rosenthal and Kramer insisted that a vote was critical based factors involving City support for the affordability options.

Kramer came to the meeting armed with a half-dozen experts assigned to convincing the Board to, not just vote favorably, but to do so in a hurry, even without knowing nearly enough about the agreement.

The item passed, and no publicly available review has taken a serious look at whether or not it’s a good deal. Consequently, Hudson Related will build, and the community will have to live with a backroom deal that may or may not be to its benefit but will certainly profit the real estate company.

But RIOC wasn’t done dishing out benefits to Hudson Related.

Just one month later, Rosenthal and Hudson tossed another project that just had to approved with little time for consideration, a joint marketing agreement, Winter Wonderland, that ended up as widely over promoted as it was underperforming. 

Widely panned, Winter Wonderland features a number of spare displays from a skimpy reindeer herd in the Tram Plaza to used, neon Christmas trees scattered in Riverwalk Commons, a really nice community tree on the Rivercross lawn and four sets of stars abandoned in Good Shepherd Plaza. 

2017, A Year When RIOC Screwed Tenants and Cuddled (Some) Landlords
© David Stone / Roosevelt Island Daily

Winter Wonderland gives a positive boost to the dreary arcade that stretches the length of Roosevelt Landings, but in spite of displays visible only from the street in front of Westview, it’s strongly oriented around Hudson Related’s revenue generating operations.

You might think that the real estate giant would invest heavily into promoting its properties and retain management, anyway, but in this deal, Hudson coughs up virtual pocket change, a skimpy $25 grand, while RIOC (hold onto your hats) soaks up $50 thousand in annual lease payment concessions.

The deal, rushed through like a shotgun wedding, sticks the community with three years of the same. In the end, the community gets nothing in return. 

Even the recycled fixtures will be recycled elsewhere. 

Conclusion

It may be that half the community has gotten used to bad deals cut by RIOC, favoring wealthy, connected real estate investors and the other half is so mobile they couldn’t care less.

But the implications are clear.

Roosevelt Island’s original plan as a mixed income community that wasn’t held hostage by politically connected investors and patronage appointments that cater to them by way of Albany is becoming a forgotten ideal, a hope gradually eroded by greed.