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February 5, 2014- By Steven E. Greer, MD
Pat Smith, local Battery Park City (BPC) resident since 2003, spoke before the February 4th CB1 board representing an unofficial group of homeowners calling themselves the BPC Homeowners Coalition. The coalition is not an official entity and has no website. The group has not convened in more than a year, according to Mr. Smith. Anthony Notaro, leader of the CB1 meeting, is also a member of the official sounding “homeowners coalition”.
Not surprisingly, the homeowners coalition seems to agree with every with every position of Speaker Sheldon Silver’s office regarding the Battery Park City Authority (BPCA).
In 2011, then BPCA Chairman Bill Thompson agreed to ground rent reductions for the residential and commercial buildings leasing from the BPCA (BPC residential owners pay in the order of $3,000 to $6,000 per year in ground rent for a 2-bedroom apartment, according to Mr. Smith in an interview with BP.TV). Mr. Silver was quoted in the press at the time as having been the crucial dealmaker assisting the homeowners coalition.
However, the Sheldon Silver deal brokered was scandalous. The same real estate companies benefiting from the ground rent breaks (e.g. LeFrak, Brookfield, Milstein, etc.) turned around and gave campaign donations to Mr. Thompson’s mayoral campaign, and to Mr. Silver’s election efforts. When this was exposed, Mr. Thompson abruptly resigned his post at the BPCA, and went on to lose the mayoral election.
Nevertheless, homeowners did benefit from this under-the-table New York politicking. It was billed in the press as a “$280 Million savings in ground rent over 30-years”, whatever that means. As a result, the homeowners coalition is now allegiant to Speaker Silver. When asked why the homeowners coalition reached out to Mr. Silver in 2011, Mr. Smith said, “Who else were we going to reach out to? Squadron? Chin? Silver is a state official and the BPCA is a state agency”.
At the CB1 presentation, both Mr. Smith and Mr. Notaro made it clear that they oppose dissolving the BPCA and having the city take over. Their fears are that the high taxation and ground rents would continue under the city, but that the city would cut resources to the parks and other amenities that make BPC such a clean oasis in Downtown.
For a full analysis of the pros and cons of the city taking over the BPC land, we refer you to our December article. One misconception held by the homeowners coalition and others is that if the BPCA no longer managed the parks, then the quality would diminish due to lack of funds. In fact, the facility fees (more than $5 Million a year, or two-thirds of the current BPC Parks Conservancy budget) would remain. That is ample funding to maintain the park conservancy, and the facility fees are also mandated by law to go to the parks. The city would have to skirt the law to pilfer those funds (which has happened before). Also, a new private group, or “Friends of BPC Parks” could be started to fundraise and maintain the BPC parks, just as all of the other city parks have in pace now.
Another misconception about the BPCA being dissolved, and reiterated by Mr. Smith at the meeting, is that the Park Enforcement Patrol officers (PEPs) are a huge amenity to BPC that would be lost. In fact, most of the PEP paid for by BPC funds are currently reassigned to nearby Hudson River Park and nearby Battery Park (not to be confused with BPC parks), as exclusively reported by BP.TV.
When BP.TV explained the PEP situation to Mr. Smith of the homeowners coalition, he replied, “I am at work and have a job to do. Good bye.”. He clearly did not want to hear about it.
The main reason that homeowners in BPC would want to see the city take over is that property values could skyrocket, making their assets appreciate 50% or more overnight. Currently, similar apartments in BPC sell for a fraction of the price of nearby apartments in TriBeCa or FiDi, if they can be sold at all due to the unwillingness of most banks to underwrite mortgages.
The two main reasons for the real estate price disparities between BPC and surrounding areas are, A) people are not actually purchasing anything. They are long-term leasing from the BPCA, and B) The huge ground rent payments that are unique to BPC. The homeowners coalition (which is just a few owners who get together very few years, and who do not represent the owners of BPC whatsoever) has concluded that those payments would remain intact even if the city assumed control of the area, and that the condo buildings would be unable to purchase their land and end the leasing deals. However, there are many examples throughout the country of residential buildings converting from a lease arrangement to ownership with thier respective cities.
Ryan Stenta, a real sate professional, wrote to BP.TV, “The individual owners would have to come up with the funds to buy out the land lease. This has happened before with co-ops as they can take out underlying mortgages to fund such a conversion from land lease to full land ownership. However if they could convert the rental properties to condos that would propel their values into the stratosphere and probably spur landlord buyout of existing tenants so as to cash in on the newfound condo equity.”
Is the BPC Homeowners Coalition another CB1-like organization purporting to speak for the people, when in fact they represent a small fraction of the citizens? Has anyone ever heard of the BPC Homeowners Coalition? They have no website.
A copy of the “Resolution” passed by the illegitimate “homeowners coalition” is found below.
Anthony Notaro did not answer his telephone or reply to our emails.
Please post your comments.
Winners and losers if the BPCA were to be dissolved
BPCA Chairman Bill Thompson abruptly resigns
Exclusive: BPCA pays for park staff reassigned to non-BPC parks