You’d think that a guy who claims to have spent his childhood doped up and locked in a dog kennel would have some sympathy for kids. That doesn’t seem to be the case with William Koeppel, the real estate scion who, in a 1997 family brawl over his father’s estate, complained that his mother had drugged and caged him as a child. Koeppel is best known, however, not as an allegedly abused child, but as a privileged pal of Rudy Giuliani whose enthusiasm for the mayor turned the landlord into a convicted rent-gouger. In 1996, Koeppel pleaded guilty to charges that he had leaned on five tenants and brokers to make contributions to the mayor’s campaign. That stunt followed his 1994 gift to 14 Giuliani staffers and campaign workers, who got cut-rate rents at Koeppel’s Upper East Side buildings.
But the mayor’s mega-fundraiser is showing nothing like generosity to the 55 children, aged two and a half to five years old, enrolled at the Unidad Day Care Center, which has been located for 25 years in the commercial space of an Upper West Side building owned by a Koeppel firm. In fact, Unidad workers say Koeppel has been downright mean. Earlier this year, Koeppel won an eviction against Unidad, forcing the center last month to relocate the children to five other day care centers. “Toward the end he was really harassing us,” says Unidad president Karole Key. “He’d come by personally saying, ‘You only have two weeks to go, you better get out of here.’ He was a very nasty man. We had to ask him to leave.”
Koeppel disputes Key’s take on their parting. “They were threatening not to move out, and we were just trying to amiably end our relationship,” he says. Koeppel adds that he has nothing but sympathy for the children, but insists that “we should not have to be the provider of social services. Believe me, I would never want to hurt the children, but they have been absorbed by other places.”
Now a legal twist has put the matter on hold, and although the children remain scattered, Unidad administrators are awaiting an October 12 court date, when a Manhattan supreme court judge is expected to rule on the center’s future. At issue, of course, is money. Koeppel wants to hike Unidad’s rent from $5000 a month to a minimum of $22,000—a rate Unidad cannot pay, even with the help it gets from the city’s Administration for Children’s Services. Koeppel says his firm, K.S.L.M.-Columbus Apartments, plans to lease the 5000 square feet occupied by Unidad for as much as $250,000 a month. Possible tenants include a vet, doctors, dentists, or “a high-end preschool” that Koeppel says would charge $15,000 a year.
In the eviction, Unidad had agreed to move out by September 15, and relocated the children by that time. But in the meantime, Unidad found a hook on which it hopes to hang an argument that the eviction was illegal. The space it rents is in a building constructed under the West Side Urban Renewal Plan, in the Westgate apartment tower located at 97th Street and Amsterdam Avenue. Under the plan, the space was to be used as a school facility, a provision that does not expire until June 26, 2002.
“I researched in the city archives like a mother,” says Jean Dorsey, chair of the Westgate Tenants Association. “It took time, but we found it.” Specifically, what she discovered was a 1969 letter from the city planning commission designating the space for a school. While the plan does not say the school must be Unidad, the gist of the urban renewal plan is that it be affordable to the community—something that rules out Koeppel’s high-end prospect. On September 14, Unidad attorney William Gribben filed a suit arguing that using the space for anything other than an affordable school subverts the urban renewal plan.
Koeppel acknowledges that the building is within the plan’s borders, but counters that a different law governs Westgate, since it was built under the state Mitchell-Lama law to house middle-income people. Developers got tax breaks in return for collecting lower rents, but in 1998 Westgate opted out of the program, and began paying taxes and charging market rents. “The building is now a luxury building,” says Koeppel. “We’re getting $4000 for three bedrooms,” which rented for $522 under Mitchell-Lama, “and $3000 for twos. The change in the neighborhood is dramatic, and it’s a reflection of the economic gentrification up here. We can’t subsidize the day care center and pay taxes.”
Last month, housing court judge Karen Smith postponed the eviction, pending the supreme court case. Before Smith made her decision, an attorney for K.S.L.M.-Columbus argued that Unidad’s continued presence impeded the company’s ability to collect stratospheric rents. “You don’t have to tell me how much rent you can get in these Mitchell-Lama buildings,” Smith said, adding that she lives in one. “Everybody knows that the market has gone insane.”
Indeed, it’s not just toddlers who are targets of Koeppel’s greed. Tenants in the 425 Westgate apartments are battling to stave off K.S.L.M.’s pending application for a 600 percent rent hike, filed when it opted out of Mitchell-Lama.
The West Side rent grab stands in sharp contrast to Koeppel’s willingness to roll back rents for those Upper East Side tenants who worked for Giuliani’s campaign or administration. While the Campaign Finance Board found Koeppel had broken no law, Koeppel himself acknowledged that the scandal had embarrassed Giuliani, whom he described as a “very good friend.” Giuliani had appointed Koeppel to the board of the Off-Track Betting Corporation, a position the landlord gave up after his rent-gouging indictment. Koeppel’s zeal for Giuliani had created problems earlier: In 1993, the mayor’s campaign had to return $1000 to Koeppel, whose contribution exceeded the $6500 limit.
Koeppel is known as quirky. He has called for the exhumation of his father’s body in the estate battle. In 1994, he appeared on the Donahue show seeking a wife. He had no luck there, but Giuliani came to the rescue, introducing Koeppel to Jean Carol Herbage. They married in 1995.