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Tenants allege Kushner firm pushed them out of their homes

Last Updated Jul 16, 2018 at 11:20 pm EDT

In this Thursday, June 28, 2018 photo, Sabine Anton looks over construction materials stored in the garage of 184 Kent Avenue in the Brooklyn borough of New York in the building owned by Kushner Cos. An Associated Press investigation into one of the Kushner Cos.' largest residential buildings in New York City reveals what some residents say was a campaign that used noisy construction to push rent-stabilized tenants out and bring high-paying condo buyers in. More than a dozen tenants told the AP that they were subjected to relentless banging, drilling, dust and rats. (AP Photo/Mary Altaffer)

NEW YORK, N.Y. – Twenty current and former residents of one of the largest buildings owned by the Kushner Cos. allege in a $10 million lawsuit that the firm used relentless, noisy construction that exposed them to cancer-causing dust as part of a campaign to get rent-stabilized tenants out and high-priced luxury condo buyers in.

The lawsuit and a separate state investigation followed an Associated Press story Sunday detailing the business practices of the family firm while it was run run much of that time by President Donald Trump’s son-in-law and now White House adviser Jared Kushner.

More than a dozen tenants described hammering and drilling so loud it drowned out normal conversation, rats crawling through holes, shaking walls, workers with passkeys barging in unannounced, and so much dust that it covered beds and clothes in closets. They say those conditions, along with rent hikes of $500 or more a month, made living there unbearable.

“They won, they succeeded,” says Barth Bazyluk, who left apartment C606 with his wife and baby daughter in December. “You have to be ignorant or dumb to think this wasn’t deliberate.”

AP’s investigation found that over the past three years, more than 250 rent-stabilized apartments — 75 per cent of the building — were either emptied or sold as the Kushner Cos. was converting the building known as the Austin Nichols House in the hip Williamsburg section of Brooklyn to luxury condos. Those sales so far have totalled more than $155 million, an average of $1.2 million per apartment.

The turnover was significantly higher than city averages for coveted rent-stabilized buildings.

The Kushner Cos. said in a statement that the lawsuit is “totally without merit” and they will fight it vigorously. It acknowledged some complaints about construction during major renovations, which ended in December 2017, but said that it responded to them immediately and that many tenants simply moved out after rents increased under what is allowed under the law.

“Tenants were never pressured to leave their apartments,” said the company, which also noted that city inspectors were sent out many times and found no violations.

The landmarked Austin Nichols House at 184 Kent Avenue, for decades a warehouse for groceries and Wild Turkey bourbon, was gutted by a previous owner in 2010 to create sleek apartments that took advantage of the building’s high ceilings and waterfront views.

When Jared Kushner and two partners bought it for $275 million in April 2015, they made it clear they wanted to convert the building’s 338 apartments — all of them rent-stabilized — into condos. All but nine were occupied, and other than maxing out the rent, developers had few tools if they wanted to get tenants out.

Just months after the purchase, the Kushners began extensive renovations, ripping out appliances, floors and countertops that had been installed five years before.

“There were consistently people in the hallway early, 8 or so, banging on things, taking down walls. There was lots of dust. … They had fans, and they were blowing dust under the doors,” says tech salesman Marcus Carvalho, who left the building in December after six years, deciding the $1,000 or so increase in rent to renew his lease wasn’t worth it. “I didn’t want to spend another minute in that construction zone.”

His 679-square-foot (63-square-meter), one-room apartment, B502, sold the next month for $800,000.

A few weeks after Carvalho left, the woman in C405 couldn’t take the noise anymore either.

“It’s like having a root canal without the physical pain. … It was drilling from every direction,” says Jane Coxwell, a chef who works late nights and writes at home during the day. “It was impossible to take a call. You could never sit and read a book or get any work done.”

Then came the rats, including one she accosted with a tennis racket as it teetered on a curtain rod in her bathroom. She also had to contend with a flood after workers hit a pipe in the unit above her and with the constant fear workers would burst into her apartment at any moment after two with passkeys tried to do just that, once while she was in her underwear.

Coxwell, a plaintiff in the lawsuit, says she sent dozens of emails to Kushner managers for more than a year asking for help, but got little relief.

One particularly noisy day she finally broke down, walked up to a construction manager and worker standing near her door and found herself forcing the words out through tears.

“I understand you have to work, but I don’t know how to ask anymore,” she pleaded. “Please, please, can you keep it down?”

She says the men just laughed.

“We’ve looked into hundreds of rent-stabilized buildings and this is one of the worst we’ve ever seen,” said Aaron Carr, head of tenant watchdog Housing Rights Initiative, whose investigation led to the lawsuit.

Much of the construction work was done in 2016, and then the Kushners went on a selling spree. In 2017 alone, the company sold 99 apartments in the building, according to Jared Kushner’s federal financial disclosure forms. Brokerage data show an additional 16 apartments sold by early March 2018. That same month Kushner Cos. had 151 vacant apartments in the building, according to a court document.

Under rent stabilization rules, landlords are limited in how much they can increase rent each year, though in this building the rents weren’t cheap, with one-bedrooms going for more than $3,000 a month.

At the height of the construction, tenants fought back with three dozen complaints to the city’s 311 hotline about work after hours, banging and pounding, falling debris and rodents.

After people complained about dust, Kushner Cos. put plastic sheeting around doorways, though many say it didn’t help much. And after they complained about workers entering their apartments without permission, the company eventually posted guards in hallways.

“The banner says ‘Luxury Waterfront Homes For Sale,'” says plaintiff Jeff Werner, a banker who’s lived in the building for eight years. “It doesn’t advertise ‘Live in a Construction Zone with White Toxic Dust Blowing.'”

Dust samples taken from nine apartments in May by consultants Olmsted Environmental Services turned up dangerously high levels of lead and crystalline silica. Breathing in tiny silica particles has been linked to lung cancer, liver disease and an incurable swelling of the lungs.

The lawsuit alleges Kushner Cos. violated of state and city rules and laws in harassing tenants and, by failing to take proper precautions, exposed residents to a “cloud of toxic smoke and dust.”

The Kushner Cos. disputed the findings of the environmental report, alleging it appeared to be an updated version of a report prepared several years ago. The company didn’t respond to a request for comment on the investigation launched by Democratic Gov. Andrew Cuomo’s Tenant Protection Unit, which is looking into whether the company violated state housing laws and regulations meant to prevent landlords from disturbing tenants’ peace and privacy.

Ronan Conroy says he complained to the Kushners several times, walking down to the sales office once to confront management in person.

“Your strategy is to get people out, right?” Conroy recalls asking a staffer at the desk. He says the man basically shrugged, offered no dispute, then said, “We can let you out of your lease.”

Frustrated and facing a big rent hike, Conroy left in early 2016.

“My strong impression is they made the building as unlivable as possible so they could get everyone out of there.”

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Burke reported from San Francisco. AP researchers Jennifer Farrar and Randy Herschaftcontributed to this report.