Here’s Mayor Zohran Mamdani’s Bad Landlord Playbook

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Mayor Zohran Mamdani wants to put “bad” landlords out of business.

For months, the mayor’s tenant-focused vision has been coming into focus. The administration’s full strategy becomes clear in the 112-page housing plan, titled “Block by Block.”

The playbook involves collaborating with tenant organizations, searching for violations, removing existing owners and bringing criminal charges.

The administration says the plan is intended to root out “a small group of persistent ‘bad actor’ landlords,” who have systematically neglected their buildings. But after legislation in 2019 capped revenues in rent-stabilized buildings, physical and financial distress have been growing in the sector. Those conditions in turn provide the city with more justification to transfer ownership.

“Escalating operating costs and real estate speculation has put several large, mostly rent-stabilized portfolios at risk of financial and physical distress,” the housing plan details. “HPD will work with vetted, responsible landlords who can immediately stabilize and improve portfolios under new ownership.”

The first step in the plan appears to be working with tenant organizations and unions for guidance on which buildings to target. There are a number of groups organizing tenants on the ground, including neighborhood-based organizations like Flatbush Tenants Union and Crown Heights Tenants Union, as well as broader city groups such as Legal Services of New York City.

From there, when landlords “fail to respond to an organized group of renters,” the city will mobilize several agencies to do “roof-to-cellar” inspections of a building, all in one day, according to the plan. These “enforcement days” may increase the number of open housing code violations in a portfolio since inspectors from the buildings, housing preservation and hygiene departments will be looking for them.

These enforcement days will specifically be for buildings that are organized, according to the housing plan document. Alleged poor conditions should affect at least one-third of a building’s units or building-wide mechanical systems, but the building cannot already be enrolled in a city special enforcement program, such as the Alternative Enforcement Program.

Landlords will also likely have a harder time in housing court if the administration gets its way. The HPD will propose rules to make it easier for tenants to legally withhold rent in escrow in response to poor conditions. That proposal will be subject to a rulemaking process.

Landlords may have other issues in court. HPD will collaborate with other agencies and the borough district attorneys to pursue criminal charges against property owners. Last year influential developers Meyer and Joseph Chetrit were indicted for alleged harassment of rent-regulated tenants. (The Chetrits have denied the allegations.)

Finally, there are several tools the administration outlined to remove owners.

“When necessary we will take aggressive legal action to remove negligent owners and property managers,” Mamdani said at a press conference.

One option the administration laid out is to engage with lenders to initiate foreclosure proceedings or force compliance with demands.

But the administration also plans to “aggressively” use a program commonly called “7A.” That allows a court to appoint an HPD-monitored administrator to operate the buildings. Either tenants or HPD can initiate that process.

Otherwise, HPD can do what it can to tip the scales toward certain mission-driven owners. That means helping new landlords or community land trusts with capital investments and tax abatements. The potential fiscal impact of those transfers, as the city foregoes property taxes and injects capital, is so far unclear.

The plan does propose some more modest help for rent-stabilized landlords. It attaches a number to the size of the city’s publicly-backed insurance plan, at $100 million, and says the Department of Finance will “explore” undefined changes to how it calculates property taxes for majority rent-stabilized buildings.
The city has already started using parts of this overall strategy on landlords and portfolios, including at Emerald Equities and two buildings associated with Fordham Fulton Realty.