50 Pages Posted: 30 Apr 2010
In the fall of 2006, a real estate group led by the father and son team of Jerry and Rob Speyer completed the largest residential real estate deal in U.S. history. For $5.4 billion, this team purchased the twin housing developments of Stuyvesant Town and Peter Cooper Village, located on the East Side of Manhattan. As part of their business plan, the new landlords sought to displace thousands of rent-regulated tenants so that market rents could be charged in the units vacated by outgoing tenants. Led by a crusading elected official, who just happened to be a resident of the complexes, the members of the complexes’ tenant association, supported by a host of lawyers from different sectors of the bar, pursued a range of legal avenues to resist the landlords’ efforts to convert thousands of units from affordable housing into luxury, market-rate housing.
In many ways, the purchase of the properties at the height of the real estate market, and the subsequent campaign to pursue a high rate of return on the investment to satisfy the debt burden on the properties, is another example of the distortions created by the era of easy credit. Much of the attention on the financial crisis focuses on the impact of the rise and collapse of an overheated home mortgage market on the broader financial system. What occurred in Stuyvesant Town and Peter Cooper Village is a symptom of that broader phenomenon, but one that occurred in the rental market, not the home mortgage market. It is a tale of irrational exuberance and aggressive speculation. The ultimate demise of the landlords’ efforts also tells another story: one of a tenant association; an elected official; and a loose network of attorneys who, together, fought back the attempts of the landlords to displace thousands of rent regulated tenants, not with bulldozers, but trumped up legal claims and an aggressive business plan.
The landlords’ efforts were ultimately halted by a recent decision of New York’s Court of Appeals in successful impact litigation filed by a class of tenants in the complexes, Roberts v. Tishman Speyer Properties, L.P., which is highlighted in detail in this article. But this legal victory, as important as it is for those tenants affected by it, tells only one part of the story. Progressive lawyers, in support of grassroots efforts, waged a campaign of hand-to-hand combat to preserve the affordability of the complexes for the tenants who live there. A review of these efforts helps to place the work of these attorneys within an emerging body of scholarship that highlights the positive and transformative power of legal advocacy to promote progressive social change. Within this body of scholarship there is a renewed yet sober appreciation for the value and ability of the law and legal advocacy to promote progressive social change. This appreciation emphasizes tactical flexibility, but also responsiveness and accountability to community interests and needs. This article analyzes the work of the attorneys who helped to orchestrate the legal campaign to preserve the affordability of Stuyvesant Town and Peter Cooper Village to determine whether their actions were consistent with this approach to progressive lawyer and to gain what insights about progressive lawyering their efforts might reveal.
Keywords: Financial Crisis, Progressive Lawyering
JEL Classification: K41
Suggested Citation: Suggested Citation
Brescia, Raymond H., Line in the Sand: Progressive Lawyering, 'Master Communities', and a Battle for Affordable Housing in New York City. Albany Law Review, Vol. 73, No. 3, p. 715, 2010; Albany Law School Research Paper No. 10-02. Available at SSRN: https://ssrn.com/abstract=1597343