Show Me the Money
Vince Castellano, who represents landlords on the Rent Guidelines Board, often talks about what he considers the city's two real estate markets: "core" Manhattan below 96th Street, where stratospheric rents and profits rule, and the rest of New York, where, in Castellano's view, landlords struggle while collecting rents that are considerably more earthbound.
The 49-year-old landlord apparently thinks there are also two worlds when it comes to financial disclosure. At a public hearing last week, Castellano badgered a group of tenant advocates about their moneydid they have savings accounts? Retirement plans? Where was their money invested?then suggested that if landlording is as lucrative as they claimed, they should get into the business themselves. At the same time, he has tried to keep private his own financial reports despite city laws that require RGB members to publicly disclose such information every year.
This spring, Castellano took the highly unusual step of seeking a waiver to keep his annual financial disclosure reports to the city's Conflict of Interest Board off-limits to the press. Such reports are generally public except for information regarding the filer's family members. COIB financial disclosure director Jerry Rachnowitz said the board rejected Castellano's request, adding that waivers are rarely granted, typically reserved for cases in which disclosure would compromise a filer's personal security. Elected officials, high-ranking city workers, and paid commission or board members must file the reports.
In April, Castellano told the Voice that he felt entitled to a waiver because he advocates for landlords, not the public, on the RGB, which each year sets rent-hike rates for 1,020,588 rent-stabilized apartments. The board has two members who represent landlords, two who represent tenants, and five who represent the public at large.
"I view the owner and tenant representatives in a different light," says Castellano, a real estate broker and owner of two buildings in Queens. Castellano had for years hosted a radio and cable television show, Real Estate Nightmares, dedicated to the plight of landlords. He is known for his provocative remarks about tenants. "I am not here representing the citizens of New York City. Disclosing that information is out of place. And besides, it's none of your damn business. . . . If you write anything about my private affairs," Castellano told the Voice, "I will not talk to you ever again."
Castellano's most recent available disclosure form, covering 1999, shows that he owns two buildings in Rockaway Beach, one of which has three commercial units, and is valued in the disclosure form's $100,000 to under-$250,000 range. Castellano's second building has seven units including rental apartments, too few to fall under rent regulation (RGB members are not allowed to own buildings covered by the rent laws). Castellano reported that the building is worth more than $500,000.
Castellano also reported having invested between $60,000 and $99,999 in a Queens liquor store, which he has since transferred to a family member. His most recent report, reflecting the year 2000, will not be available until late June.
Castellano's disclosure forms show that he runs a real estate brokerage valued at between $20,000 and under $60,000 and described it as "primarily limited to apartment rentals to residential tenants whose rent is paid by government" subsidiesironic considering that Castellano routinely rails against rent regulation as government interference with the market but is apparently willing to accept taxpayers' dollars as rent.
He is an ardent advocate of the so-called "poor tax," which sticks an additional monthly hike onto low-rent apartments, most recently those renting for $500 or less. Castellano's tirade last week came after five tenant advocates called for a moratorium on this and any other rent hikes, arguing that landlords are doing very well while rent-stabilized tenants are not. Patrick Markee of the Coalition for the Homeless testified that the city's robust economy and the accompanying brutal rental market have contributed to a burgeoning shelter population, which last month approached an average of 27,000 people a night. If the RGB were to adopt the preliminary hikes it approved last month (3 percent for a one-year lease and 5 percent for a two-year lease), Markee calculates it would mean a minimum transfer of $275 million from the pockets of tenants to landlords. This year's proposed poor tax of $15 a month amounts to an additional $37 million, much of it coming from the city's poorest tenants.
But what sent Castellano into a rage was the tenant advocates' claim that landlords' net operating income (money left over after paying operating costs not including mortgages and taxes) is about 45 cents on the dollar. "I want to know why these people are not investing in real estate," Castellano taunted, insisting the numbers were off. "If they say that you get 45 cents on the dollar in real estate, why don't they just put their money there?"
The RGB will hold a public hearing on the proposed rent hikes on June 13 from 10 a.m. to 9:45 p.m. at the Langston Hughes Auditorium, 515 Malcolm X Boulevard, at 135th Street. Its final vote is scheduled for June 20.
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