Landlords push back of Zohran Mamdani's plan to freeze rent for stabilized units
According to both Burgos, and Lav Bauta, the property manager for Zion Equities, the issue with freezing rent, is that because of inflation and rising insurance costs, the price of maintaining and running buildings keeps going up.
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Among Mayor-elect Zohran Mamdani's big campaign promises was a pledge to freeze rent for the more than two million New York City residents currently living in rent stabilized housing.
While it is a popular policy, it is getting some pushback, led by Kenny Burgos, who considers Mamdani a friend.
The two overlapped for several years in high school at Bronx Science but really got to know each other when they sat side-by-side in the New York State Assembly for four years, before Burgos stepped down to become CEO of the New York Apartment Association and represent rent-stabilized property owners and managers.
"I've told (Mamdani), I said I don't think you understand the crisis that you're walking into," Burgos said. "You don't understand the severity of the rent stabilized crisis, and this has the power to derail his administration in the way the Eric Adams administration was derailed by the migrant crisis."
According to both Burgos, and Lav Bauta, the property manager for Zion Equities, the issue with freezing rent, is that because of inflation and rising insurance costs, the price of maintaining and running buildings keeps going up.
"And if you add in a rent freeze, it is a death sentence for many of these buildings," Burgos said.
Bauta says that especially when it comes doing upkeep and maintenance, "there's no return on investment with the existing structure, the horizon is so far out, you'd never return your principle."
According to a campaign video on social media, Mamdani says there is a city fund that landlords can apply for if they really need a little extra money.
But according to Bauta, it is incredibly complicated to apply for, and Burgos says to date, it has not had a single successful applicant.
Both know that people will argue they are just trying to pad their pockets - Mamdani even says the Rent Guidelines board found "landlord incomes rose by nearly twice the increase of their expenses."
However, Burgos and Bauta says those numbers group stabilized units together with others, and if they only looked at the ones that are stabilized, they would see that the margins are razor thin.
"We don't have a lot we're working with," Bauta said. "We're literally trying to keep everybody happy, there are thousand and thousands of people in the buildings we manage."
Burgos says he also wants housing to be affordable, but that "affordability is predicated on stability, and if these buildings can't survive, there's no affordability to be had."
As for whether or not Mamdani could freeze the rent, that decision is made by the Rent Guidelines Board, which has its members appointed by the mayor.
Mamdani has said he would appoint members who would agree with him, but Burgos claims that would be illegal - since according to the law, RBG members need to be independent and make decisions based on data, not pre-determined politics.
