Lessons for Mamdani in East Harlem’s Rent-Stabilized Housing

Mark Furman began his career at a nonprofit doing what Mayor Zohran Mamdani would call God’s work: helping affordable housing residents take over their buildings.

But the laws of physics and finance prevailed in the end, as they always do.

In the early 1980s, his nonprofit used Section 8 and other federal funds to renovate aging, low-rise buildings in Madison, Wisconsin, and taught the subsidized residents how to self-manage and keep costs down.

“The staff provided guidance and support — helping develop budgets, working with residents to identify maintenance needs,” Furman said by email. “It was a great model and I loved helping folks take control of a small corner of their own lives. But it ultimately failed.”

The government had adequately funded the initial work but not the long-term needs of the properties, and the restricted rents did not make up the shortfall.

“There simply was not enough money in reserves or other funding available to fix the structural and capital problems that are inevitable with any real estate, let alone renovated older properties,” Furman wrote. “Roofs, HVAC systems, old pipes — buildings require constant feeding and care, as any property manager well knows.”

New York City’s own property crisis is like the one he encountered in Wisconsin but on a massive scale: Hundreds of rent-stabilized buildings are in distress as escalating expenses and a tourniquet on rents force owners to defer maintenance.

Furman is on the front lines. He was hired by a lender to manage 38 rent-stabilized buildings in Spanish Harlem, on which it is foreclosing. The owner stopped sinking money into the 900-unit portfolio but still couldn’t make the mortgage payments.

“We are just trying to keep the units habitable and operational while the lender seeks to gain title and then dispose of the properties to offset its losses,” Furman wrote.

But even without having to pay debt service, the rent revenue — which Mamdani aims to freeze — simply isn’t enough.

“It is often hard to cover basic operating costs, taxes, and rising insurance premiums for many of the buildings given the restricted rents, let alone try to address years and years of deferred maintenance on boilers, roofs, pipes, gas lines, cameras, etc.,” Furman explained.

“My staff and I respond as quickly as possible to problems with failing boilers, rotting gas lines, decaying roofs, moldy bathrooms with inadequate ventilation, but the litany of problems in these long-neglected properties is staggering.”

The property manager’s 876-word message to The Real Deal should be required reading for Mamdani. The mayor hasn’t acknowledged the impossibility of maintaining aging buildings with uncontrollable expenses and low rents that tenants increasingly don’t pay.

Instead, he has blamed landlords for the dilapidated condition of buildings and announced “rental ripoff” hearings to let tenants do the same — as if shaming owners changes the math when regulated rents are already too low to keep properties up to code.

Beneath the surface of Mamdani’s public narrative, his court filings and lobbying show his strategies for distressed, rent-stabilized buildings include devaluing them to reduce debt service and steering them to nonprofits to eliminate property taxes.

The mayor has also said he wants to work with the real estate industry, but nothing indicates he has spoken to people like Furman. The property manager’s reward for trying valiantly to stabilize the buildings was a place on Public Advocate Jumaane Williams’ “worst landlords” list.

A simple check of property records shows the six properties that landed Furman on the list are actually owned by Isaac Kassirer, who bought them with financing from California-based Sabal Capital just before the rent laws changed in 2019.

“I guarantee that we are doing much better than the last group that owned these apartments, but it is going to take more than patching them up to ensure long-term stability for these units,” Furman wrote. “It requires a significant capital improvement plan that the restricted rents cannot support on their own.”

Furman said he would love to live in a world where people without means are guaranteed housing. But his decades of experience with affordable housing “makes it clear that this cannot happen solely on the backs of the free market.”

“I have heard it said that Republicans like to privatize profits and socialize costs,” Furman observed. “Mamdani is the inverse, it seems, seeking to privatize the social costs of affordable housing. It will not work.”