NEW YORK — A New York City real estate group, which acquired dozens of apartment buildings in a few years, has settled with the State for nearly $2 million after an effort to defraud rent-stabilized units. and evict tenants, some with more than three decades in their homes, Attorney General Letitia James announced Friday.
Details in the $1.75 million settlement outline the group’s efforts to deregulate affordable housing and make a significant profit by selling the units near market price. To change the units, Attorney General Letitia James said the company worked to strategically push out tenants through takeovers, harassment and worsening living conditions.
Ink Property Group bought 32 buildings between 2014 and 2019, mostly in low-income communities of color, an investigation by James’ office found. Several tenants who tried to fight back against these illegal tactics eventually left their homes because “they were no longer habitable,” James said.
Employees working for Ink were offered large bonuses for successfully convincing rent-stabilized tenants to move out; each purchase earned an employee $5,000.
“As New Yorkers faced sky-high rents and struggled to find affordable housing, Ink tried to get rich quick by preying on vulnerable renters and their families,” James said.
The shady tactics didn’t stop after the tenants left, the attorney general said. Once Ink got its hands on the vacant units, the company completed the housing upgrades and raised rents to the “highest rate the market allows.”
“Ink ignored the Individual Apartment Improvement (IAI) system established in rent stabilization laws and instead treated each new vacancy as an unregulated unit, regardless of whether the renovations made met the criteria to achieve deregulation. James’ office said Friday.
A tenant who lived in her rent-stabilized unit for more than 30 years, James said, repeatedly turned down offers to buy from the company. Since half of her neighbors left, voluntarily or not, many of her units allegedly became dilapidated and neglected to the point of affecting the woman’s health and safety.
The real estate group had also been accused of submitting false income reports to banks to obtain more favorable loans. A lengthy investigation by the attorney general’s office found false documents reporting inflated rents and fake leases, some referring to the names of family and friends.
In addition to the $1.75 million owed by Ink and earmarked for Attorney General James’ Affordable Housing Fund, the company must also pay $400,000 in restitution to tenants pressured to vacate and $2,500 to each tenant forced to live in dangerous conditions. James said more than two dozen apartments will be re-regulated.
“Lying and cutting corners to evade rent stabilization is one of the oldest tricks of the trade, but Ink’s years of exploiting our hard-working neighbors without consequence ends here. These tenants organized and fought back, and because of their efforts, they will be compensated for the suffering they have endured,” the attorney general said.
A lawyer for Ink Property Group said the company’s “early mistakes” are in the past.
“We’re proud of our record since then as a responsible custodian of affordable and market-rate housing in diverse New York City neighborhoods. Going forward, we’ll work hand-in-hand with a respected third-party management company to ensure we continue our ascent.” in the ranks of New York City’s finest homeowners,” a statement read.
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