Name: Joseph Tahl
Company: Tahl Propp Equities
Title: President and co-founder
Hometown: Westbury, Long Island
Currently living in: Harlem
How many apartments do you own, and are all of them in Harlem?
They are. We started buying buildings in Harlem in 1998. We were one of the first of all the major real estate firms to come into that market. We own, manage and are developing a total of 3,200 units in East and West Harlem. More than 95 percent of our apartments are affordable housing. We enter into long-term, 30-year-plus affordability agreements with housing agencies such as HUD, HPD and DHCR to ensure that our apartments are set aside for low- and moderate-income tenants.
Did you decide at the start that affordable housing would be your focus?
We were still learning the Harlem market then. As we’ve been in Harlem for many years now and have been very supportive of community, tenant and housing organizations, we realized that affordable housing is not only what New York City needs, but what Harlem needs. Today, we think it’s terribly important that all this newfound prosperity in Harlem benefits everyone, especially folks who’ve been there the longest and have a tendency to be left out or left behind.
How does Mayor de Blasio’s housing push affect your operation?
We’re actively involved in the mayor’s plan in Harlem. We are in the middle of a several-year effort to preserve about 1,500 units of mostly low-income housing [through regulatory agreements with agencies]. We’re also working with the agencies to develop up to 1,100 units of new affordable housing on two large parking lot sites that we own. One is an entire square block, and the other is almost two entire square blocks.
How did you get involved in real estate?
I started out as a real estate lawyer at Dreyer and Traub, a New York City law firm representing developers. The developer that I worked primarily for when I began in the late 1980s was Donald Trump. At the time, he was building Trump Palace and the Trump Taj Mahal, and selling the St. Moritz Hotel. I worked in a group of nine lawyers at the firm that represented Mr. Trump on his real estate development matters. I left there after three years because Mr. Trump made me an offer to come on as associate general counsel of the Trump Organization, his real estate firm. I jumped at the offer. You can learn from him just listening to him order lunch. I learned a lot about real estate in my five years there, and I left because I wanted to become a developer. I wanted to see if I could just start buying apartment buildings. In 1998, I teamed up with Rodney Propp to form Tahl Propp Equities.
How did you meet Rodney?
We met through mutual friends in the early 1990s. Rodney and I often joke that our business partnership and friendship have outlasted both of our first marriages combined. He’s more actively involved in investor relations and capital formation than I am. I spend my days sweating my ass off in Harlem, but what Rodney does from Midtown on the capital side is equally important to the sweat equity I put in.
Are you buying less than you used to?
Yes, we’re looking at other acquisition and development opportunities in Harlem. We have [also] looked at the outer boroughs and done a couple things outside the city. This is a market we certainly know; we couldn’t duplicate that presence, market vision and capability in any other market.
Why have you moved away from buying?
The prices that we paid for any kind of sizable buildings between 2000 and 2004 are such a small fraction of what the buildings are worth today. I’d be reluctant to sell anything because I don’t know how you could buy it back. Given market prices, I can’t imagine assembling a portfolio like that today.
How extensively have you had to renovate some of these properties?
Some of the buildings we bought are 100 years old. When we bought them, they hadn’t been properly maintained for 50 years or more. I remember replacing the elevators in two buildings that were built in 1905. When the elevator contracting company took apart an elevator, a worker called me over. He said the elevator was so old that the rails in the elevator shaft that the car was riding on were made of wood, not steel. That’s the way elevators were first made, I guess. I thought, “Wow, it really is time for a new elevator.” I’m proud that in all of the capital improvements we’ve done on our buildings, we have never charged tenants an MCI [major capital improvement] rent increase. We’ve always exempted tenants from those increases because we didn’t want to be viewed as a landlord that was trying to push people’s rents up for the purpose of displacing them.
How many condos are in your portfolio?
No more than 150 units are condos [in West Harlem]. That’s a small part of our business, but there are developers in Harlem building condos. That would be a bad thing if that’s all you were seeing. Most of what you’re seeing there is affordable development, which is what you should see. We also have 50-some retail stores at the apartment houses. I live in one of our buildings on Adam Clayton Powell Boulevard in Central Harlem.
What are the biggest buildings you own?
The biggest building that we own is called 1775 Houses, which holds 255 low-income affordable units. The second biggest building is also low-income affordable, called Gladys Hampton Houses, which has 205 units.
In the coming years, do you see your approach changing?
Now that Mayor de Blasio has put forth a positive affordable housing plan, that’s where most of our growth and new business will be. But we are open to other types of investment in Harlem, whether it is schools or commercial facilities. As Harlem develops, the community will speak to what types of projects it needs, and we hope to be an active part of that.