New York City’s real estate industry is facing a difficult year. This is not solely due to headwinds arising because we are relatively late in the construction cycle or as a consequence of the capping of SALT deductions. Instead, the industry’s biggest issues are largely political.
Representatives of the real estate industry have become personae non gratae to the more progressive wing of the Democratic party in both the state Senate and the City Council, and many of these politicians are publicly declaring that the industry itself is so toxic that their election campaigns will not be accepting contributions from real estate interests. As additional evidence of how radioactive the industry is, January marked the first time in recent memory that the Council speaker, the mayor, and the governor all declined invitations to attend the Real Estate Board of New York’s annual gala.
Writing for Politico New York, Dana Rubinstein noted that it is reminiscent of the way politicians began to distance themselves from the tobacco industry decades ago.
It’s no surprise why so many politicians are eschewing real estate. The industry is about to face a wave of new regulations that have been dreamed up by progressive politicians and endorsed (sometimes tacitly, sometimes openly) by Governor Andrew Cuomo. They do not want there to even be the suggestion that developers or landlords had a hand in shaping these policy changes, so they are keeping them at arm's length.
There are currently dozens of pieces of legislation potentially on the table that could have a significant impact on the real estate industry in the city and beyond if they pass. A short list of these include:
- Restricting increases of preferential rents to the adjustment amount approved by the Rent Guidelines Board
- Eliminating vacancy bonuses
- Repealing vacancy decontrol
- Amending the current Major Capital Improvements and Individual Apartment Improvement programs
To remain successful as the regulatory landscape changes, landlords and property managers will need to change with the times. To find out how this is possible, we recommend attending our Monthly Meet-Up Tuesday February 26, 2019, at the WeWork on West 36th Street in Manhattan. We will be hosting Robert Sedaghatpour and David Goldfischer of @STRATCO Property Group, who will discuss the coming changes to rent laws this year.
As the LandlordsNY Rent Regulation Expert, STRATCO works with landlords to keep them ahead of the curve and to create business strategies that allow them to avoid getting caught up by any regulatory pitfalls. If you want to be prepared for the upcoming changes to rent regulation that will likely occur in 2019, you should get your tickets to February’s Meet-Up today.