Looming Rent Increase of Up to 9 Percent Tests Adams’s Housing Priorities

When he ran for mayor, Eric Adams positioned himself as a champion for the working class — a lifelong New Yorker who had grown up in poverty and won support from voters in the boroughs outside Manhattan.

But in his first months in office, he could oversee rent increases of up to 9 percent for the city’s roughly one million rent-stabilized apartments.

The powerful Rent Guidelines Board, which the mayor effectively controls, will take a preliminary vote on Thursday on proposed rent increases of 2.7 to 4.5 percent on one-year leases and 4.3 to 9 percent on two-year leases. A final vote is expected in June.

Critics say those rates are too steep — 9 percent would be the largest increase since 1990 — and unfair when the state’s eviction moratorium ended in January and market-rate rents across the city are rising.

More than 2,000 eviction cases are being filed each week, and rents have risen 33 percent, according to one real estate website.

The proposed rent increases present a challenge for Mr. Adams, a Democrat, who is facing criticism within his party for supporting any substantial increase when many New Yorkers are still struggling during the pandemic.

His predecessor, Bill de Blasio, backed rent freezes and modest increases during his eight years in office because he said they were crucial to fighting inequality.

Mr. Adams, who is himself a landlord and has rented out his Brooklyn property, which is not rent stabilized, has defended the need for rent increases, though he did not say how much they should rise.

He argued that higher rents were necessary for small property owners facing rising costs.

“We must be fair here — allow tenants to be able to stay in their living arrangements, but we need to look after those small mom-and-pop owners,” Mr. Adams said at a news conference last month. “If you invested all your money into a 10-unit house, and you cannot pay the bills, you could lose that.”

Groups like the Working Families Party note that most rent-stabilized buildings are owned by large landlords, not small property owners. They point to a report by a tenant advocate and adjunct urban planning professor at New York University that found that only about one-third of rent-regulated buildings were owned by landlords who had five buildings or fewer.

The issue is part of a growing rift over housing between Mr. Adams and the City Council, where leaders have criticized the mayor’s focus on removing homeless encampments at a time when affordable housing is scarce.

Adrienne Adams, the Council speaker, called the proposed rent increases “unconscionable” and said they would “only exacerbate the housing and homelessness crises confronting our city.”

The politics of a rent increase are complicated for the mayor, said Basil Smikle, director of the public policy program at Hunter College. Mr. Adams could be viewed as insensitive to the concerns of New Yorkers who are struggling to pay rent, but his message about supporting small property owners could connect with his supporters, Mr. Smikle said.

“It’s possible that a lot of the mom-and-pop owners came from areas where he got strong support in Queens and Brooklyn,” he said.

A report by the Rent Guidelines Board found that costs have risen substantially for building owners since spring of last year, including a 19.6 percent increase in fuel costs. Insurance costs rose 10.9 percent and utilities like electricity rose 5.8 percent.

Shahana Hanif, a City Council member from Brooklyn and a chair of the progressive caucus, said the rent increases would be “excruciatingly painful” for tenants and urged the Adams administration to look for other solutions to support small landlords.

“I’m adamantly opposed to the rent hike and find it really disgraceful that the mayor isn’t showing the compassion and empathy that we need for tenants,” she said.

The annual decision by the Rent Guidelines Board, which affects more than two million residents who live in buildings built before 1974 that have six or more units, always ignites passionate debate and an intense lobbying effort from tenants and landlords.

For decades, the board approved sizable increases almost every year — often from 3 percent on one-year leases to 8 percent on two-year leases — but that came to an end under Mr. de Blasio. As he left office, Mr. de Blasio named the board’s rent freezes and modest increases during his tenure as one of his greatest achievements.

Landlords have pushed for substantial rent increases at the higher end of the proposed range. They argue that new state rent laws approved in 2019 favoring tenants already made conditions more difficult for landlords.

“This is a starting point for owners to recover from eight years of rent freezes and inadequate guidelines, and the draconian changes to the state’s rent laws,” said Vito Signorile, a vice president at the Rent Stabilization Association, which represents about 25,000 owners.

The rent board has nine members, all appointed by the mayor: five representatives of the public, two of owners and two of tenants. Mr. Adams has named three appointees since taking office.

His choice in March of Arpit Gupta, a finance professor at N.Y.U. and an adjunct fellow at the right-leaning Manhattan Institute, as a representative of the public raised concern among tenant advocates.

Mr. Gupta told Vox last year that he was a “little skeptical of rent control.” He declined a request for an interview on Wednesday.

Brad Lander, the city comptroller, said that appointing someone “who has expressed skepticism about the entire system of rent regulation is deeply troubling.” He urged the board to reconsider its proposed increases.

“While a modest rent increase may be merited this year, Mayor Adams’s appointed board must not return to the days of Giuliani and Bloomberg’s unreasonably high increases,” Mr. Lander said.

Mr. Adams also appointed Christina Smyth, a lawyer who says on LinkedIn that she represents “multifamily building owners,” as the landlords’ representative, and Adán Soltren, a staff attorney at the Legal Aid Society, a nonprofit that provides legal services to poor New Yorkers, as a representative of tenants.

Mr. Adams won a competitive Democratic primary last year with support from Black and Latino voters and working-class neighborhoods, but he is also close to business leaders and real estate developers.

Members of the Real Estate Board of New York, the real estate industry’s main lobbying arm, donated to Mr. Adams’s campaign or to a PAC that supported him.

Aby Rosen, a co-founder of RFR Realty, gave $100,000 to the PAC, called “Strong Leadership NYC,” and Gary Barnett, the founder of Extell Development Company, gave it $250,000. Other real estate executives like Richard LeFrak, chief executive of the LeFrak Organization, donated to Mr. Adams’s campaign.

Mr. Adams said last month that small landlords had been “decimated” by the pandemic and could lose their buildings to landlords who own thousands of units.

“What happens if they lose their buildings?” Mr. Adams said. “The megaguys come in and buy the buildings, and now we see the gentrification that we all say we fear.”

Dana Rubinstein and Mihir Zaveri contributed reporting.

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