Tenants will suffer again under City Council’s outrageous plan for apartment buildings

Supporters say the bill will keep housing "affordable" and "rooted in community control." Getty Images

New York’s City Council is intent on helping nonprofits snap up apartment buildings, whether owners want to sell to them or not.

Last week, leftist Councilwoman Sandy Nurse reintroduced the Community Right to Purchase Act, which would give city-approved groups preferential treatment in the sales of certain apartment buildings — such as by forcing owners to sell to them if they match competing private offers.

Supporters say the bill will keep housing “affordable” and “rooted in community control.”

But this outrageous subversion of private property will only deter investment, damage the city’s housing stock — and fail to make housing more affordable.

Late last year, an earlier version of COPA failed after Mayor Eric Adams vetoed it on his last day in office.

The council wasn’t able to override him, but now it’s taking another bite at the apple.

One key problem with COPA is the heavy regulatory burden it would impose on owners.

Anyone intending to sell a “covered property” would first have to notify both the city’s Department of Housing Preservation and Development and a list of department-approved nonprofits of the intended sale.

The groups would then have 20 days to submit a “statement of interest” if they are thinking of purchasing. Those that do would have another 70 days to make an offer.

If the nonprofits don’t submit an offer, or if their offers are rejected, the owner can solicit private bids.

But the law would grant nonprofits a “right to first refusal,” meaning they would have to be notified of all private offers received.

Owners would be obligated to sell to them should they match the terms made by another private buyer.

In other words, the city would force owners to contract with nonprofits of its choosing — an egregious attack on private property that my colleague Christian Browne has noted could very well violate state law.

As written, COPA could sweep thousands of buildings across the city into its scope, including distressed properties, buildings in foreclosure, properties with outstanding violations and those with expiring affordability agreements.

Few buyers will want properties encumbered by months of delay, higher legal fees and uncertainty.

Even third-party bidders will think twice if a deal can be pulled out from under them.

The bill’s likely result: depressed property values. Shoddier units. And tenants suffering, in turn.

Owners who know their properties are worth less will try to cut their losses by putting less money into them.

Any improvements in “affordability” would thus come at the cost of quality; buildings subject to COPA will be in poorer conditions than if left in private hands.

This isn’t mere speculation. After decades on the books, Washington, DC, rolled back parts of its version of COPA.

Not only did the law produce costly delays and uncertainty, it failed to deliver the hoped-for wave of tenant and nonprofit ownership.

It created a weaker housing market: delayed sales, less investment and aging buildings left with owners who wanted out.

In addition, many nonprofits buyers will likely enter into preservation agreements with the city’s Department of Housing Preservation & Development to secure property-tax exemptions over their new buildings.

When buildings stop paying property taxes, the city doesn’t cut spending to make up the difference.

It’s up to remaining taxpayers to pick up the slack — and subsidize the nonprofit sector and its jobs.

Worse, nonprofits or “community-based organizations” aren’t any better at providing housing.

Just because a building is owned by a nonprofit doesn’t mean it doesn’t have to pay its bills. There’s no escaping the hard reality that rents need to cover costs.

The average operating income of a pre-1974 stabilized unit is just $512 per month — before paying the mortgage. In The Bronx, it’s just $283.

Over 20% of nonprofits’ current portfolio isn’t even bringing in enough revenue to meet expenses.

But for the city’s far left, COPA offers a chance to strengthen its voter base by supporting jobs in the NGO housing sector, dependent on public-sector support.

It would do little to improve the quality of housing, and its ability to make apartments more affordable is dubious, at best.

If city leaders are serious about making housing truly more affordable and fostering long-term communities, they would encourage private investment — by making it easier to build new housing and reducing the regulatory frictions to enter and exit the housing market.

When regulation makes investment less attractive, the public suffers: Just look at New York’s 50,000 vacant rent-stabilized units, the result of laws that make it impossible to recover expenses to bring apartments up to code.

Whatever its intentions, COPA is a serious threat to private property from city leaders who are unserious about making housing better or more affordable.

Adam Lehodey is an investigative reporter at Manhattan Institute’s City Journal.