Kushners Used ‘Toxic’ Construction to Drive Out Tenants, Suit Says
Posted July 16, 2018 8:13 p.m. EDT
NEW YORK — Developer Charles Kushner, whose son Jared Kushner is a son-in-law and senior adviser to President Donald Trump, has received a lot of attention in New York.
But perhaps not the way he, or his son, ever wanted.
On Monday, 20 current and former tenants of a one-time warehouse in Brooklyn that the Kushners are converting to luxury condominiums filed a $10 million lawsuit in state Supreme Court, claiming that the family’s business aimed to force them out with tactics like “loud and obnoxious drilling” and a “constant cloud of toxic smoke and dust.”
As a result, scores of rent-regulated tenants left the seven-story building at 184 Kent Ave., in Williamsburg, and their apartments were sold to buyers for millions of dollars. Despite numerous complaints to the city’s Department of Buildings, tenants said, the dangerous conditions and the violation of city statutes persisted for about three years.
“It certainly seems as if it was in the Kushners’ interest to oust the tenants,” a lawyer for the tenants, Jack L. Lester, said Monday at a news conference in front of the Supreme Court building in Downtown Brooklyn. “The construction activity, intentional or not, made tenants’ lives miserable and many left.”
Eric L. Adams, the Brooklyn borough president who is a former New York Police Department captain and a sponsor of the lawsuit, said: “We need to use this moment in a real way. The Kushner name draws attention not only to the president’s chief adviser but also to what a big-name developer is doing to tenants right here in Brooklyn.”
Adams suggested that the city needed to focus on the displacement of tenants by rapacious landlords in the same way that the Police Department had used data to fight crime.
“The key,” he said in an interview before the news conference, “is that we should be using the same methods to fight grand larceny to monitor bad-acting landlords in real time.”
The Kushner Cos. issued a statement Monday saying that the lawsuit was “totally without merit” and the company would defend it “vigorously.”
Until the last decade, the Kushners were known as developers and owners of garden apartment complexes in New Jersey, philanthropists and major Democratic contributors. But in 2007, Charles and Jared Kushner paid a record price of $1.8 billion for a 41-story aluminum-clad tower at 666 Fifth Ave. in Midtown Manhattan.
After selling a large portfolio of garden apartments for nearly $2 billion, the father and son went on a buying spree, acquiring land, buildings and storefronts in Queens, Brooklyn and Jersey City.
The older Kushner is now in the middle of a deal for a financial rescue of 666 Fifth Ave. by Brookfield Asset Management, one of the world’s biggest real estate investment companies. A proposed three-tower project in Jersey City, New Jersey, came to a standstill last year after a falling out with the mayor.
The previous owner of 184 Kent Ave. carved the landmark — a 103-year-old former warehouse known as the Austin Nichols House — into apartments more than five years ago. Kushner Cos., with Jared at the helm, bought the property with partners for $275 million in 2015.
Their plan was to make renovations to create larger units and then sell the apartments as condominiums, a seemingly daunting challenge since all the apartments were rent-regulated, with tenants protected from large rent increases and unreasonable evictions.
The apartments, which rented for as much as $4,000 a month, were not for low-income tenants or older adults. But the units were regulated because the previous owner had received a tax break under a city housing program designed to encourage building improvements. That owner had given leases to tenants at rents lower than what was permitted under rent regulation to fill the building, according to an executive who works with Kushner Cos. and spoke anonymously.
Kushner Cos. moved to implement the full legal rents, which in some cases resulted in large increases.
Then, according to the lawsuit, it used the renovation process to make tenants so miserable they would leave, a tactic that housing activists say has become widespread, contributing to the current housing crisis.
“This is going on throughout the city,” said Lester, the tenants’ lawyer. “They’re not the only landlords doing this. But the Buildings Department seems to think their mission is to expedite construction, rather than protect tenants.”
Apartment prices in the building today range from $950,000 for a studio to more than $2.5 million for a three-bedroom.
The Kushner Cos.’ statement insisted that the residents were fully apprised of the renovation work before it started and the work was conducted under the supervision of the city’s Buildings Department and other regulatory agencies.
“Tenants were never pressured to leave their apartments” and the company complied with all rent regulation laws governing the property, the statement said. “Any complaints during construction were evaluated and addressed by the property management team.” The city’s Department of Buildings, which said it had responded to 27 tenant complaints at the Kushner building in Brooklyn over three years, seemed somewhat bewildered by the criticism from tenants, housing activists and elected officials.
“Department of Buildings inspectors were at the building dozens of times since 2015 and did not observe any violation of construction rules,” Joe Soldevere, an assistant commissioner for the agency, said. “In addition, our building marshals performed proactive sweeps of the building in July 2017 and April 2018 and found no violations.”
In the spring, an outside firm, Olmsted Environmental Services, hired by tenants to assess conditions in the building, found that construction work had contaminated apartments with potential toxic dust containing lead, gypsum and other minerals. Olmsted concluded that the residue supported “the tenant committee contention that no dust controls are used during work.” But the assessment was conducted many months after construction was completed and stopped short of describing what the lawsuit said was a “constant cloud of toxic smoke and dust.”
Gov. Andrew M. Cuomo wrote on Twitter on Monday that the state was “launching an investigation into allegations of tenant harassment by the Kushner Cos.”
But housing activists were not letting him, or Mayor Bill de Blasio, off the hook. Aaron Carr, founder of the Housing Rights Initiative who helped initiate several lawsuits against the Kushners, said it was “the Kushner Cos.’ failed morality” that exposed tenants, including children, to toxic dust, but that “it was New York state’s failed policies that exposed tenants to Kushner.”