Boy Developer Ben Shaoul Wants to Live Forever

Sounds like you have found your niche and a great area to do it in. Good luck on your new venture and much success.

As a leading member of the Shaoul Tenants Organizing Project (STOP) representing tenants in seven of the Shaoul's buildings I think it might be useful to correct the record.

Ben Shaoul, his sister Elizabeth, their parents Abraham and Minoo, their associate Michael Soleimani (former exclusive broker for Massey Knakal in the East Village), Josh Slepian, Billy Yu, sometime partners Rob Kaliner, the Ascend Group and others own about 50 properties mostly located in lower Manhattan. They have recently partnered up with Normandy Real Estate Partners and Westbrook Partners in the purchase of 17 properties from Extell Corp.

The extended Shaoul family has been involved in real estate for some time. Others include Jack and Michael Shaoul.

Their modus operandi is to target rent regulated buildings and drive the tenants out. This is done through intimidation, litigation (including SLAPP suits -- Strategic Lawsuits Against Public Participation in government), Dept. of Building (DOB) work permits which are used to transform entire buildings into hard hat areas intentionally creating unlivable conditions, and other forms of legally tolerated harassment. The DOB has facilitated much of the Shaoul's efforts, so much so that most of their residential buildings have been emptied of their original tenants. This is often accomplished within months.

Those tenants who have held out are constantly harassed by threatened or actual litigation, or at least are never sure what will come next creating extreme stress.

Tenants have been falsely accused of trespassing, harassement of workers (in one case accusing one tenant of surrounding a group of workers whatever that might mean), tortious interference, extortion, criminal attacks on their workers (one female tenant was arrested under false charges when the supervisor of the Shaoul demolition crew lied to police.

Tenants routinely have their rent refused, face claims that they are not allowing repairs to be made, are told they are not legal or that they are not rent regulated. Many have been threatened with a little known legal loophole now called phony demolition. The result is that tenants who fail to organize and sustain their joint opposition to the attacks fall prey to pitifully low buy out offers or are just forced out if they don't know their rights.

A classic tactic used by the Shaouls is to buy a rent regulated tenement (termed undervalued in real estate jargon), excavate the basement and rear yard, add additional floors on the top, force tenants out and demolish empty units, all to create market rate apartments. In no time, apartments which may have rented for $600 go for over $2000. Buildings in which tenants have lived for decades are changed into temporary housing for students and young executives in New York for a year or so. If Ben Shaoul thinks so highly of the East Village why doesn't he live there to experience first-hand the rape of the neighborhood at his and his cronie's hands.

Recently some tenants prevailed in an appeal of a DOB decision to allow so-called vertical enlargements on tenements. This proceeding at the Board of Standards and Appeals (BSA) was won by unanimous vote and was supported by letters and testimony from many elected representatives and even the Dept. of City Planning. That has meant nothing because the DOB has chosen not to enforce the BSA ruling until the apppeals have been exhausted. Though the apartments are illegal they are occupied, also without a Certificate of Occupancy. This means that the Shaouls are literally able to use the rent roll from these illegal units to finance future purchases and even their appeals.

Other scams exploited by the Shaouls are claiming to build community facilities which allows them a bonus of allowable square footage. They then rent these units out as luxury residential apartments. One such unit on W. 16th Street is rented out as a 5 bdrm. apt. The DOB does nothing about it even though they are made aware.

One DOB inspector at a building in the East Village told tenants that the owners are "connected" and have "more money than God."

This, believe it or not, is the short version of the story.

Those interested in knowing more about this may be put in touch with the Shaoul Tenants Organizing Project by calling GOLES, Cooper Square Committee, or Councilmember Rosie Mendez's office or may contact us directly.

We are still waiting for a real piece of investigative writing about this family and their tactics.

in reading your long drawn out talk of public bad mouthing of an individual who I personally have watched from a distance for many years work very hard in creating a beautiful neighborhood taking buildings that were neglected for years make them in to beautiful habitats and has not allowed the abuse of the public housing system to dominate the east village by people who can otherwise go out and work for a living. he has been very charitable with many causes both locally and elsewhere he has nothing to be ashamed of, rather you and your group should take a deep breadth and reflect in the mirror before pointing the finger.
Naftali

Why would you live in a building whose owner you don't like? Because you lived there before, because you worked hard to create a home, because you became part of the community - and because you are outraged by the outrageous methods of people lik Shaoul.

Shaoul should compliment his publicist on this puff piece, following on the Observer's Peck piece a few weeks back. Obviously the Observer doesn't care about selling to the people who have long lived on the Lower East Side; it's clear who your audience is, and what your agenda is. Like Peck and Shaoul, you want to drive out the community that exists in the Lower East Side and replace it with ever more new junior financial analysts.

Clearly "Anonymous" is unemployed... who else would have the time to author such a rant? If you spent as much time contributing to society (i.e. paying taxes) perhaps we would live in a better place.

I should lke to point out a few salient facts.

The Shaouls and their ilk are only able to get away with their crusade against affordable housing because the city and state agencies (esp. the DOB and DHCR) have been empowering them to do so. While it is true that the rent regulation laws in NYS are the strongest in the nation, enacted to guarantee working people the ability to live and work in their communities without fear of displacement by greedy vulturous speculators, these laws are not being diligently enforced. Likewise, while it is true that the Building Code, Zoning Resolutions and Multiple Dwelling Law severely restrict enlargements to tenements (for fire and safety reasons, to maintain proportional scale, etc), these laws are also being brazenly ignored. That is why the tenants in one of the buildings had to go to the BSA to ask them to overturn the DOB. Their victory is important but empty until that agency stops acting with impunity favoring so-called "development" at any cost. The DOB has also seen fit to ignore the MDL which as state law trumps any city ordinance. So, the responsibility for what the Shaouls and their comrades are doing is co-owned by government for allowing it while ignoring those laws designed to protect tenants from exactly such circumstances and conditions. If the Warranty of Habitability, as guaranteed by the NYS Real Property Law is being breached by what are clearly illegal DOB work permits that agency is equally culpable.

If Naftali has any difficulty understanding any of these words I suggest investing some of his/her real estate dollars in a dictionary.

For some perspective see: http://www.villagevoice.com/news/0127,lobbia,26089,5.html

so Mr. Shaoul hired a PR firm to sweeten an image that reeks of greed and disregard for the people that made downtown the great diverse neighborhood that made NYC a great adventure to live in and be part of....Thank you Mr. Forever for getting rid of all the people who came here to be something,and take a chance on life, this was the place to do it,then you and yours invaded, and took no prisoners.....oh, and that bit about about Starbucks...the soulless rich that are decadent to pay top dollar to live here and be "hip", brought with them the chain store mentality that they so can't live without, you can't take the mall out of them...yet the soulless wonders did come here for a reason....that being to PARTY, look at the rape of Ludlow Street, or 5th St.between Ave A&B or better yet,6th St.(A&B)....looking forward to your next conquests....
it much more resembles Las Vegas, than NYC now, thanx....
they say that Hell is forever....thanx for bringing it to us....you'll not be forgotten

As someone unfortunately familiar with the antics of Ben Shaoul I was bemused by this interview. Why the emphasis on condos? Shaoul himself admits that their core business is rentals: "Rentals is the bread and butter of this business; it pays for everything" he avers. One wonders what "this business" means.

The incontestable fact is that the Shaouls and their backers purposely seek out and target rent regulated housing. That's odd. Why would anyone want to buy a rent regulated building with a low rent roll in today's hyper-inflated market, especially since New York has the strongest tenant protection laws in the country? Spending ca. 3 million dollars for a 20 unit building with a rent roll of about $150,000 per year just wouldn't make sense. You are hardly going to be able to pay your property taxes, no less make a profit.

The trick, you see, is getting rid of the tenants as quickly as possible and replacing them with people willing to pay astronomical rents just to live in a closet sized apartment in a “cool” neighborhood that hasn't been "cool" for years (because of them). As Ben Shaoul says: "We buy buildings; we increase the value..." That seems simple but how exactly does one accomplish that? This is where the website of one of the Shaoul's private equity backers -- Normandy Real Estate Partners becomes instructive. They write: “The investment strategy is to capitalize on the strength of the local economy and New York City rental market as well as the increased institutional appetite for New York City rent stabilized housing transactions. There is a near-term opportunity to increase cash flow by converting rent stabilized apartments to market rate as tenants vacate units.” They continue: “There is an opportunity to increase rental income at the properties by renovating units and releasing at market rate.” That's pretty straightforward. So, the goal is to increase the rental income by helping the poor befuddled tenants who have lived there for decades and “are” the community to vacate so they can pay three or four times more elsewhere or just leave the City altogether since there is nothing affordable within a 100 mile radius. Then, the brilliant young entrepreneur, using those innate intellectual powers that could not be contained by the likes of [Dade Commuity College?] renovates the units and “releases” them, i.e. de-controls them, thereby increasing his rental income, or “bread and butter.” The problem is: how do you get the tenants to vacate if they don’t want to move and are protected by the rent regulation laws fearlessly administered by the brave bureaucratic hacks at the Division of Housing and Community Renewal (DHCR)?

How about knocking down doors with crowbars? That might work. In fact, it was very effective on St. Mark's Place. Shaoul laughably denies that his goon squad was armed with these “demolition tools” in order to strong-arm the residents into vacating the building. He avowed that crowbars are integral to demolition work. Well, I can think of far better tools for tearing down asbestos laden walls and ceilings. But yes, crowbars are very useful when your plan is to crawl in the windows of a squatter building from the fire escape to "intimidate" the residents, legal or not. That was what the neighborhood residents heard anyway. Shaoul, who word has it, was not even the owner of that property when this incident occurred, has not shied away from such heavy-handed tactics, especially when dealing with "illegitimate" tenants, i.e. squatters or, god forbid, immigrants. Just have a look at the 2001 Village Voice piece on him, when he was still new to the game. If I remember correctly, at 166 Elizabeth Street he banged on resident’s doors in the middle of the night demanding that they get out of “his” building. Calling Immigration authorities or Children’s Services is apparently another favored method of helping tenants vacate, it has been said. Is it any wonder that he was honored in 2007 as one of the city’s ten worst landlords?

Unfortunately, though these tactics are often quite effective and can be fast, they may not work in buildings occupied by tenants with leases, especially if those tenants are not new immigrants afraid of legal entanglements. For these stalwarts other more profound, legalistic challenges are in store including an arsenal of legal loopholes identified and exploited by a cadre of lawyers, architects and engineers. After all, a dead-beat rent regulated tenant is still just a dead-beat tenant in the eyes of the “boy wonder” and the longer one of these tenants remains in his/her legal apartment the more money is lost by this messianic agent of gentrification.

In fact, getting rid of these tenants and hiking the rent to the bearable market limit is not enough. To realize a decent profit it is also necessary to increase the square footage of the building, to create more units unhampered by rent regulation. Who cares about issues like density? What difference does it make that fire and safely issues, or light and air protections are ignored? That’s where the Department of Building (DOB) comes in since enlarging the building and “renovating” vacated units are part of the nexus of intimidation and harassment.

The Observer interviewer, Max Abelson, asked Shaoul to name his favorite architect. Shaoul shied away from answering, brilliantly deflecting this important question. This might be because his favorite, or at least most oft-used architect, Ramy Isaac, of Isaac and Stern, recently lost his right to participate in the DOB’s Professional Certification Program (a.k.a. self-certification) having been found to have dissembled repeatedly. What is Isaac’s specialization you may wonder? Like a zealot on a crusade this architect divined that the DOB was willing to issue self-certified permits as a form of blanket plausible denial in order to allow for work from basement to roof (and higher) in occupied housing. Warranty of Habitability be damned, they probably say. We must help these tenants vacate so that these apartments may be hastily renovated and leased to young investment bankers, NYU business students and others who will not be around for more than a year or two and could care less what happens when they return to the housing tract wasteland from which they emerged or the cradle to coffin social nets if they represent the international bourgeois comprador classes who have recently descended upon New York City in droves.

Another important aspect of DOB facilitation is that agency’s willingness to, let’s say, disregard many of the laws that prevent developers from overbuilding. Recently, they sent a letter to a City Council Member declaring that the Multiple Dwelling Law of 1929 (State law) is too burdensome and can not possibly be enforced, at least in those cases where the lack of enforcement has been noticed and challenged. Earlier, they insisted that Zoning Resolution (ZR) 23-692 (the Sliver Law) was also to be ignored but motivated tenants who still prize their first amendment rights successfully (for the time being) opposed this insidious effort to illegally legislate by a City agency. Have you ever wondered why so few tenements have been vertically elevated? You can thank these laws. But not anymore if the DOB and trailblazers like the Shaouls have their way. Look around your neighborhoods. You will see one “vertical enlargement” after another. In most cases, you will also notice that all of the apartments have been “released” and renovated making room for new tenants who know nothing of tenant’s rights and could care less. It is these permits and the work they allow that are Isaac and Stern’s calling card, it would seem.

Add into the equation other DOB scams like the Community Facilities and Quality Housing programs (square footage bonuses) and you have the elements that make rent regulated (“undervalued”) buildings so enticing to wide-eyed young developers like Ben Shaoul, along with Normandy, Westbrook Partners, Extell Corp., Dawnay, Day and other billion dollar private equity firms. Now is the time for the haves to take even more particularly if they happen to live is countries with stronger currencies and can take advantage of a US dollar in free fall.

What better scenario could be imagined? The DHCR is not protecting tenants against harassment. The Housing Court is just an arena for frivolous litigation brought by landlords against tenants (most of whom cannot even afford legal representation) making the judicial system no more than another vehicle of harassment. Every NYC resident should visit this zoo at least once in order to see how justice is bought and sold on a daily basis. With the DOB providing for and sanctioning the very physical conditions in occupied buildings that make it nearly impossible for tenants to withstand the onslaught (loss of heat and hot water, interruptions of gas and electricity, lack of security, intimidation by workers, dust and debris, ceiling leaks and damage to walls, etc.) is it any wonder that the number of rent regulated dwelling units in the City is disappearing at an alarming rate? But fear not! Our proud Mayor, a man of the people who rides the subway to work every day (and earns more than everyone on my entire block would in a lifetime during that short commute, just in interest) is demanding an increase in what he calls affordable housing (tax incentives for the speculators). The problem is that you and I could never afford to live there should they ever be built.

Now here’s the rub y’all. Many of us don’t even want to live in these “hip” areas anymore because they aren’t even “hip”. As a matter of fact, they couldn’t possibly be more “unhip.” Some of us were never “hip” to begin with. We just happen to live in areas that became so for a short while. We are not slackers taking advantage of unfairly low rents. We are working people, taxpayers, some more marginal than others, but all deeply woven into the fabric of what were once vibrant communities in what was once a diverse and interesting city. Many of us are exiles from other areas previously colonized by post-hip hipsters. Others are just regular people who are trying to live out their lives in the only homes they have ever known. We don’t want to have to dodge and weave our way through crowds of young Ipod people walking their little dogs (conspicuous consumption), while talking on their cell phones, while trying to balance on their four inch heels, all while hailing a cab. I, for one, don’t even want to be around people with those sensibilities or lack of them. But, this is where I live. The world has narrowed my options so much that even if I wanted to move someplace more civilized I can’t afford it. So there you go. I, like hundreds or thousands of others are fighting each day to keep a roof over our heads, to remain financially independent. We are no longer surrounded by people reading Walter Benjamin or Deleuze. Now, they read monstrously narcissistic garbage like “2020 Vision: New Business Models for the 21st Century, or something of that ilk. It’s no longer Sartre or Camus. Now it’s Ayn Rand, the philosopher of greed. We don’t congregate in the Orlin, the Kiev, Dojo or others places that used to define the Lower East Side because if these businesses still exist they are not the same. Simply put, we are not fighting to hold onto something that is already gone. We are fighting to hold on to what is legally ours, something precious. That’s right, affordable housing, the most important thing there is besides affordable health care to any person not born to privilege. If people like Ben Shaoul, pining for another Starbucks or Duane Reade, people who long for the mallish comforts of the suburbs, who see housing not as a right but as an investment, think they are going to just trample our rights like the Gilded Age barons they are sorely mistaken. They have a fight on their hands, even if it’s just a few stubborn individuals who have nothing more to lose.

I am a building manager in NYC, I manage about 1500 units most of you rent controlled tenants are full of shit.

you sublet your apartments at market rent---I have spent hundreds of thousands of dollars just in security equipment outside these apartments just to have evidence to go to court to prove that these "rent controlled tenants" are full of shit.

additionally there is a concept of costs rising, a bottle of soda 4 years ago used to cost you 79 cents now it costs $1.69, prices for food go up, prices for cars have went up, prices for gas have gone up, prices of real estate went up, why should someone get to pay $600 for an apartment that is worth $7,000????

maybe you should start harassing the coca-cola company for raising their prices, either get a freakin job so you could afford what you want or go move to upstate new york.

if you can't afford a lexus then you cant drive one its that simple, you people obviously cant afford to live in Manhattan, so then don't live there ,you can't expect people to sponsor your luxuries.,

as for his issue with the squatter-------- props to him, a squatter is like a thief, I owned properties in newark, nj, and i had squatters I hired people to outright kick the shit out of them, they wreck the place, they are equal to a thief , they have no rights to being there, his property he has every right to beat the shit out of them.

I cant wait until all rent control is abolished----- it is a bunch of bullshit

... Shaoul has a record and it's not good; it's notoriously bad...

I live in the LES--in a small coop, thank you very much--and no kidding Shaoul has a bad record. That mess on St. Mark is a freaking mess and, no, the community area is not a community area.

Please note Bob Arihood's post about the illegal construction in the building on 8th St.:

http://neithermorenorless.blogspot.com/

How can i get in touch with you. I am a tenant in a building where Ben Shaoul is harassing the tenants. We need help. Thank you.

Shaoultenants@yahoo.com

BENNY BOY IS GOING DOWN THE DRAIN

On behalf of the owners at The "A" Building, 425 East 13th Street.
We thank you for your posting and your efforts. As an owner with an Uncle who is a longtime editor at The Times, I will be more more than happy to have that piece of investigative reporting produced for our city's people. It is an absolute outrage what Ascend Group's-Shaoul&Kaliner, Architects-Centra/Ruddy & marketers,Cantor/Pecorella have sold to us, after holding our 10% deposits with year delay. Cantor is marketing Shaoul's Yves building. We have so many suits in this building after only 2 months occupancy, due to unlivable unit conditions from massive plumbing leaks, broken appliances, deplorable workmanship, including all our floors buckling, major substitutions of high end finishes, and major shortage of square footage. Many owners are young successful artists, film makers, musicians and bankers from the neighborhood, who wanted to buy here to invest in what inspires us, and makes us feel like we still have a piece of old New York.There were few condos to choose from, and a pool is a great alternative to a summer share, and provided us with a sense of community. It might look like a "Poseur Palace", but I assure you the people are real, and not accepting this kind of bait and switch from any of the companies involved in this house of cards.

I was threatened in person by the developer Kaliner and his foreman, at the door of my $1 million condo, while on a business conference call with the overseas banks. This was a supposedly about asking to remove some surfing stickers from my door to keep the rat infested, fire code viololating, filthy construction site of a hallway, "uniform." However, we all know it was an intimidation tactic after he was threatened with legal action due to my unit's rapidly deteriorating conditions, and no action by the contractors in 5 weeks of working from home waiting. I'm glad he brought his "heavy", because a 5'10" blonde female executive is VERY scary!!

We'll be having a little sit down with Mr. Bloomberg, and some other NYS politicians, in regard to this matter with Mr. Shaoul & Co. It's our understanding Shaoul abandoned Kaliner on this debacle. However, he did just purchase the tenement next door to the 14th street side of the "D- Building." With the return on his investment in our condos, no doubt.

We look forward to meeting with STOP and offering our business+family connections, and assistance in anyway. Please feel free to send literature to any of the following units, 5J,5K,5C,5D (our resident policeman,) as it will be distributed to all the owners, including the attorneys who own here.

Thank you for your time in submitting your well written, and impactful response to this interview with the highly educated Mr. Shaoul. We will post it to our private building web page. I feel badly Mr. Shaoul at 30 is still single. I cannot figure out why, especially with "more money that God!" Should I set him up with my 6' blond sister, who is the General Consul for the largest privately held commercial realty firm on the East Coast? Oh no, I was sicing, I mean saving, her for Kaliner's 2 sons who will live in 6A. Intimidation is a two way street!