U.S. Markets close in 1 hr

Tenants allege Kushner firm pushed them out of their homes

Bernard Condon and Garance Burke, Associated Press

NEW YORK (AP) -- Twenty current and former residents of one of the largest buildings owned by the Kushner Cos. allege in a $10 million lawsuit that the firm used relentless, noisy construction that exposed them to cancer-causing dust as part of a campaign to get rent-stabilized tenants out and high-priced luxury condo buyers in.

The lawsuit and a separate state investigation followed an Associated Press story Sunday detailing the business practices of the family firm while it was run much of that time by President Donald Trump's son-in-law and now White House adviser Jared Kushner.

More than a dozen tenants described hammering and drilling so loud it drowned out normal conversation, rats crawling through holes, shaking walls, workers with passkeys barging in unannounced, and so much dust that it covered beds and clothes in closets. They say those conditions, along with rent hikes of $500 or more a month, made living there unbearable.

"They won, they succeeded," says Barth Bazyluk, who left apartment C606 with his wife and baby daughter in December. "You have to be ignorant or dumb to think this wasn't deliberate."

AP's investigation found that over the past three years, more than 250 rent-stabilized apartments — 75 percent of the building — were either emptied or sold as the Kushner Cos. was converting the building known as the Austin Nichols House in the hip Williamsburg section of Brooklyn to luxury condos. Those sales so far have totaled more than $155 million, an average of $1.2 million per apartment.

The turnover was significantly higher than city averages for coveted rent-stabilized buildings.

The Kushner Cos. said in a statement that the lawsuit is "totally without merit" and they will fight it vigorously. It acknowledged some complaints about construction during major renovations, which ended in December 2017, but said that it responded to them immediately and that many tenants simply moved out after rents increased under what is allowed under the law.

"Tenants were never pressured to leave their apartments," said the company, which also noted that city inspectors were sent out many times and found no violations.

The landmarked Austin Nichols House at 184 Kent Avenue, for decades a warehouse for groceries and Wild Turkey bourbon, was gutted by a previous owner in 2010 to create sleek apartments that took advantage of the building's high ceilings and waterfront views.

When Jared Kushner and two partners bought it for $275 million in April 2015, they made it clear they wanted to convert the building's 338 apartments — all of them rent-stabilized — into condos. All but nine were occupied, and other than maxing out the rent, developers had few tools if they wanted to get tenants out.

Just months after the purchase, the Kushners began extensive renovations, ripping out appliances, floors and countertops that had been installed five years before.

"There were consistently people in the hallway early, 8 or so, banging on things, taking down walls. There was lots of dust. ... They had fans, and they were blowing dust under the doors," says tech salesman Marcus Carvalho, who left the building in December after six years, deciding the $1,000 or so increase in rent to renew his lease wasn't worth it. "I didn't want to spend another minute in that construction zone."

His 679-square-foot (63-square-meter), one-room apartment, B502, sold the next month for $800,000.

A few weeks after Carvalho left, the woman in C405 couldn't take the noise anymore either.

"It's like having a root canal without the physical pain. ... It was drilling from every direction," says Jane Coxwell, a chef who works late nights and writes at home during the day. "It was impossible to take a call. You could never sit and read a book or get any work done."

Then came the rats, including one she accosted with a tennis racket as it teetered on a curtain rod in her bathroom. She also had to contend with a flood after workers hit a pipe in the unit above her and with the constant fear workers would burst into her apartment at any moment after two with passkeys tried to do just that, once while she was in her underwear.

Coxwell, a plaintiff in the lawsuit, says she sent dozens of emails to Kushner managers for more than a year asking for help, but got little relief.

One particularly noisy day she finally broke down, walked up to a construction manager and worker standing near her door and found herself forcing the words out through tears.

"I understand you have to work, but I don't know how to ask anymore," she pleaded. "Please, please, can you keep it down?"

She says the men just laughed.

"We've looked into hundreds of rent-stabilized buildings and this is one of the worst we've ever seen," said Aaron Carr, head of tenant watchdog Housing Rights Initiative, whose investigation led to the lawsuit.

Much of the construction work was done in 2016, and then the Kushners went on a selling spree. In 2017 alone, the company sold 99 apartments in the building, according to Jared Kushner's federal financial disclosure forms. Brokerage data show an additional 16 apartments sold by early March 2018. That same month Kushner Cos. had 151 vacant apartments in the building, according to a court document.

Under rent stabilization rules, landlords are limited in how much they can increase rent each year, though in this building the rents weren't cheap, with one-bedrooms going for more than $3,000 a month.

At the height of the construction, tenants fought back with three dozen complaints to the city's 311 hotline about work after hours, banging and pounding, falling debris and rodents.

After people complained about dust, Kushner Cos. put plastic sheeting around doorways, though many say it didn't help much. And after they complained about workers entering their apartments without permission, the company eventually posted guards in hallways.

"The banner says 'Luxury Waterfront Homes For Sale,'" says plaintiff Jeff Werner, a banker who's lived in the building for eight years. "It doesn't advertise 'Live in a Construction Zone with White Toxic Dust Blowing.'"

Dust samples taken from nine apartments in May by consultants Olmsted Environmental Services turned up dangerously high levels of lead and crystalline silica. Breathing in tiny silica particles has been linked to lung cancer, liver disease and an incurable swelling of the lungs.

The lawsuit alleges Kushner Cos. violated of state and city rules and laws in harassing tenants and, by failing to take proper precautions, exposed residents to a "cloud of toxic smoke and dust."

The Kushner Cos. disputed the findings of the environmental report, alleging it appeared to be an updated version of a report prepared several years ago. The company didn't respond to a request for comment on the investigation launched by Democratic Gov. Andrew Cuomo's Tenant Protection Unit, which is looking into whether the company violated state housing laws and regulations meant to prevent landlords from disturbing tenants' peace and privacy.

Ronan Conroy says he complained to the Kushners several times, walking down to the sales office once to confront management in person.

"Your strategy is to get people out, right?" Conroy recalls asking a staffer at the desk. He says the man basically shrugged, offered no dispute, then said, "We can let you out of your lease."

Frustrated and facing a big rent hike, Conroy left in early 2016.

"My strong impression is they made the building as unlivable as possible so they could get everyone out of there."

___

Burke reported from San Francisco. AP researchers Jennifer Farrar and Randy Herschaft contributed to this report.

  • 7 Stocks to Buy and Hold Through Any Market Selloff
    Business
    InvestorPlace

    7 Stocks to Buy and Hold Through Any Market Selloff

    Last week’s market collapse made headlines throughout the world. Since the sharp correction has negatively impacted virtually all investment sectors, you’re going to find discounted deals everywhere you look.

  • Bill Gates Mourns His Microsoft Co-Founder Paul Allen: 'Personal Computing Would Not Have Existed Without Him'
    Finance
    Fortune

    Bill Gates Mourns His Microsoft Co-Founder Paul Allen: 'Personal Computing Would Not Have Existed Without Him'

    Microsoft co-founder Paul Allen’s death yesterday was met with mourning from people who remembered him for his various business ventures, philanthropic work, and sports enthusiasm. Bill Gates, who co-founded Microsoft msft with Allen, was among them. From our early days together at Lakeside School, through our partnership in the creation of Microsoft, to some of our joint philanthropic projects over the years, Paul was a true partner and dear friend.

  • Price Target Update for Canopy Growth in October
    Business
    Market Realist

    Price Target Update for Canopy Growth in October

    How Analysts Rate These Cannabis Stocks in October (Continued from Prior Part) Canopy Growth Without a doubt, Canopy Growth (CGC)(WEED) has been one of the hottest cannabis stocks on the market (MJ). The company is one of the most valuable companies,

  • Saudi Arabia using the 'oil weapon option' could cause prices to soar to $150
    World
    Business Insider

    Saudi Arabia using the 'oil weapon option' could cause prices to soar to $150

    Analysts see a 1973-style embargo as unlikely, but warn oil prices could hit triple-digits if tensions escalate. "We believe that Saudi leadership would be extremely reluctant to exercise the oil weapon option, as its reputation as the world’s stable, reliable oil central banker would be severely undercut," RBC analysts wrote in a research note.

  • Down 28% In 3 Months, Will Facebook Stock Ever Recover? 1 Analyst Thinks So
    Business
    Motley Fool

    Down 28% In 3 Months, Will Facebook Stock Ever Recover? 1 Analyst Thinks So

    Decelerating revenue growth, shrinking margins, and surging expenses: Facebook's (NASDAQ: FB) Q2 earnings results were not for the faint of heart. Three months after that report lopped $120 billion off the social network's market cap, however, one analyst is stepping up to call Facebook stock a buy today. Facebook's last earnings report came out on July 25.

  • Finance
    CNBC

    Disney vs Netflix: Here's which stock would have made you richer if you invested $1,000 10 years ago

    On October 16, 1923, Walt and Roy Disney founded The Walt Disney Company and, nearly a century later, the company is one of the largest and most successful media conglomerates in the world. The answer is Netflix. According to CNBC calculations, a $1,000 investment in Netflix in October 2008 would be worth more than $97,560 as of after the earning bell on Monday, or more than 96 times as much, including price appreciation and dividends reinvested.

  • Where Will NVIDIA Be in 5 Years?
    Business
    Motley Fool

    Where Will NVIDIA Be in 5 Years?

    At one time, NVIDIA (NASDAQ: NVDA) floated under the radar in the technology sector. Its graphics processing units (GPUs) were then niche tech products that appealed mainly to graphic artists and hardcore PC gamers, but that all changed over the last

  • Jamal Khashoggi was accidentally killed during interrogation: report
    World
    Fox Business Videos

    Jamal Khashoggi was accidentally killed during interrogation: report

    Fox Business foreign policy analyst Walid Phares on the report that Saudi journalist Jamal Khashoggi was accidentally killed.

  • Forget Gilead Sciences: Intercept Pharmaceuticals, Inc. Is a Better Growth Stock
    Business
    Motley Fool

    Forget Gilead Sciences: Intercept Pharmaceuticals, Inc. Is a Better Growth Stock

    Gilead Sciences (NASDAQ: GILD) has clearly lost its luster as a growth stock over the last three years, thanks to a suite of setbacks for its oncology and hepatitis C franchises, as well as an increasingly competitive HIV marketplace. Gilead's stock, for instance, has woefully underperformed the broader biotech landscape during the past 36 months. With a price-to-sales ratio of 18.9 at present, Intercept's stock might not look like an outright bargain.

  • These are the bad things about early retirement that no one talks about
    News
    MarketWatch

    These are the bad things about early retirement that no one talks about

    For all the glamour of living an early retirement lifestyle, there are plenty of negatives I’ve come to discover since I permanently left my job in 2012. As a result, you’re repeatedly forced to will yourself into action.

  • JCPenney Stock: Do Analysts Foresee Any Upside?
    Business
    Market Realist

    JCPenney Stock: Do Analysts Foresee Any Upside?

    Can New CEO Bring JCPenney Back on Track? (Continued from Prior Part) Consensus “hold” rating Most analysts currently have a “hold” recommendation for JCPenney (JCP) stock. The mid-tier department store chain was rated a “hold” by 75%, or 12 out of 16

  • A Google self-driving car reportedly caused a crash in 2011 after a former engineer changed its code to drive where it wasn't supposed to (GOOG, GOOGL)
    Finance
    Business Insider

    A Google self-driving car reportedly caused a crash in 2011 after a former engineer changed its code to drive where it wasn't supposed to (GOOG, GOOGL)

    Before Anthony Levandowski was accused of stealing trade secrets from Google sister company Waymo, he worked on Google's in-house self-driving car unit, nicknamed Project Chauffeur. Former Google executives claimed that Levandowski ignored safety concerns, including in one instance where he allegedly took a self-driving car on an off-limits route. While working at Google's Project Chauffeur, the self-driving car program that would later evolve into Waymo, Levandowski allegedly modified the car's software so it could be taken on routes that were previously off-limits.

  • Three local Sears, Kmarts to close in latest round as retailer files for Chapter 11
    Business
    American City Business Journals

    Three local Sears, Kmarts to close in latest round as retailer files for Chapter 11

    Sears Holdings Corp. (NASDAQ: SHLD) announced Monday it will close 142 unprofitable Sears and Kmart stores by the end of the year, including three in Greater Washington, as the struggling Illinois-based retailer attempts to right its financial ship via bankruptcy proceedings. The Kmart at Springfield Plaza, the Sears at 15700 Emerald Way in Bowie and the Kmart at 6163 Oxon Hill Road in Oxon Hill will liquidate their inventory and shutter.

  • 3 Top Large-Cap Stocks to Buy in October
    Business
    Motley Fool

    3 Top Large-Cap Stocks to Buy in October

    If you're looking for high-quality large-cap stocks to add to your portfolio this month, three of our Motley Fool contributors have some ideas. Here's why you should consider Berkshire Hathaway (NYSE: BRK.B), Cisco Systems (NASDAQ: CSCO), and AT&T (NYSE: T). Tyler Crowe (Berkshire Hathaway): Perhaps one of the most ridiculous investment takes out there right now is that Berkshire Hathaway's immense cash pile isn't a good thing.

  • A Look at AT&T’s Dividends
    Business
    Market Realist

    A Look at AT&T’s Dividends

    What Investors Should Know about AT&T’s Growth Prospects (Continued from Prior Part) Shareholder returns Increasing capital returns to shareholders is one of AT&T’s (T) main priorities. In the second quarter, the company returned $3.1 billion to shareholders

  • Even With $80 Oil, You Should Avoid These 3 Stocks
    Business
    Motley Fool

    Even With $80 Oil, You Should Avoid These 3 Stocks

    Three oil and gas stocks that truly stick out as companies with a "stay away" label are independent oil and gas producer SandRidge Energy (NYSE: SD), equipment and services provider Weatherford International (NYSE: WFT), and pipelines and logistics specialist Buckeye Partners (NYSE: BPL).

  • Goldman Sachs and Raymond James cut Netflix price target ahead of earnings
    Business
    Yahoo Finance Video

    Goldman Sachs and Raymond James cut Netflix price target ahead of earnings

    Netflix getting its price target slashed by both Goldman Sachs and Raymond James ahead of its highly expected earnings report tomorrow. Both firms are concerned that rising interest rates could pinch the company’s valuation.

  • Business
    Benzinga

    Jim Cramer Advises His Viewers On Cisco, Microsoft And More

    On CNBC's "Mad Money Lightning Round", Jim Cramer said Microsoft Corporation (NASDAQ: MSFT) can still be bought, but only a half of a position. United Technologies Corporation (NYSE: UTX) is going to be stuck until it buys Rockwell Collins, Inc. (NYSE

  • KKR executives pull out of Saudi conference - sources
    World
    Reuters

    KKR executives pull out of Saudi conference - sources

    (Reuters) - Joseph Bae, co-president and co-chief operating officer of private equity firm KKR & Co LP, and David Petraeus, chairman of the KKR Global Institute, have withdrawn from the Future Investment Initiative conference to be held in Saudi Arabia

  • 3 Marijuana Stocks to Buy in October
    Business
    Motley Fool

    3 Marijuana Stocks to Buy in October

    If you've been trading marijuana stocks hoping to make a lot of money fast, stop it. Three that I think fit the bill are CannaRoyalty (NASDAQOTH: CNNRF), Canopy Growth (NYSE: CGC), and Scotts Miracle-Gro (NYSE: SMG). Here's why these look like great marijuana stocks to buy in October.

  • KMI, EPD, ETE, and OKE: Key Midstream Rating Updates
    Business
    Market Realist

    KMI, EPD, ETE, and OKE: Key Midstream Rating Updates

    MLPs Fell Last Week, Outperformed the Broader Markets (Continued from Prior Part) Credit Suisse updated its ratings Credit Suisse updated its ratings on several MLP and midstream stocks last week. Credit Suisse started coverage on Plains All American

  • Walmart is aggressively shifting away from its most legendary shopping format
    Finance
    Yahoo Finance

    Walmart is aggressively shifting away from its most legendary shopping format

    Walmart (WMT) continues to kill off the American shopping creation it’s most known for, the massive supercenter that sells everything under one roof. With the U.S. market already having more than 3,500 Walmart supercenters and a focus by CEO Doug McMillon to increase spending on eCommerce and India, Walmart said Tuesday it will open a mere 10 supercenters in 2019. The company has reduced emphasis on the store format pioneered by founder Sam Walton – which could average a gargantuan 178,000 square feet – in recent years.

  • Here's the Average Social Security Benefit for 2019
    Business
    Motley Fool

    Here's the Average Social Security Benefit for 2019

    Millions of seniors collect Social Security, and without it, they'd be underwater on their bills. At present, the average retiree gets $1,422 a month in Social Security benefits. There's a world of misinformation surrounding Social Security, and perhaps one of the most detrimental myths out there is the notion that the program is enough to sustain seniors by itself.

  • The Largest Private Employer in the World May Soon Sell Marijuana Products
    Business
    Motley Fool

    The Largest Private Employer in the World May Soon Sell Marijuana Products

    With literally hours remaining, Canada is set to lift the curtain on nine decades of recreational marijuana prohibition tomorrow. This makes Canada the first industrialized country in the world to legalize adult-use weed. As you might rightly imagine, investors can't wait for this legalization to take place.

  • Better Buy: Western Digital Corporation vs. Intel Corporation
    Business
    Motley Fool

    Better Buy: Western Digital Corporation vs. Intel Corporation

    Western Digital (NASDAQ: WDC) and Intel (NASDAQ: INTC) are both mature tech companies that lead their respective industries. WD is the world's top maker of HDDs (hard disk drives), and Intel is the top manufacturer of CPUs for PCs and data centers. WD's stock tumbled 40% over the past six months, while Intel's stock slumped 15%.