John Catsimatidis: Tough Guy For Tough Times

John Catsimatidis: Self-made billionaire; owner of the Gristedes supermarket chain; developer of a planned, 660-unit project on Myrtle Avenue; potential mayoral candidate who says only he is tough enough to carry this city through the tough times ahead. In an interview with Brownstoner at his modest office in Hell’s Kitchen (not the trendy part), he describes a bleak future for Brooklyn and beyond. He’s not even positive the first phase of his Myrtle Avenue project is a “slam-dunk” because he hasn’t closed on the loan and “the banks are being a little more onerous than they used to be.” But Catsimatidis says the foundation was poured just in time for the 100 units to fall under the old 421-a rules that give him a tax breaks without providing any affordable units. Families United for Racial and Economic Equality (FUREE) just happens to be planning a protest outside his development site today, furious he reneged on his pledge to build 215 below-market apartments there. The group will also release a report on the displacement of residents and businesses as a result of the Downtown Brooklyn rezoning. Catsimatidis responds to our question about displacement: “There’s no displacement of residents that I know of. There’s no residential buildings that are really being torn down that I know of, and it’s just like I said, people have to stay where they are during a possible recession period.” We’ll find out in the coming months if he plans to officially throw his hat in the ring. Click through to read the interview, edited for length.

Brownstoner: You’ve eliminated the affordable housing component for your Myrtle Avenue project, which is [planned at] 660 units total. What do you think that means for other projects that would be seeking bonds?

It’s not true that we eliminated it forever. The first building we’re building, there’s not an affordable component. They didn’t have any municipal bonds to give us. For the affordable deal, they promised in the future that they think they’ll have some bonds available in 2009. So as we’re building, if we’re building, depending on the sanity of the real estate market in 2009, and if there are bonds available, and the bond market is open to buy these bonds, then we will consider building some affordable units in those buildings.

Looking forward today, the insanity going on in the mortgage market and what’s going on with Fannie Mae and Freddie Mac, they’re sold off 50 percent — I’m not terribly optimistic that the real estate market will come back next year. The building that we are building now, we wanted to continue to do something so it’s not just a vacant lot, and to provide essential services for the neighborhood like the Duane Reade that we’re contracted for. And the supermarket may be one of ours, it may not be one of ours. And one of the banks that were dealing with has agreed to provide a construction loan, which we haven’t closed on yet. But we did get the foundation in on time to meet the June 30 deadline for the 421-a tax abatement (under the old 421-a rules, developers could receive tax abatements without including affordable housing in their projects, unless they were building in certain Manhattan neighborhoods. As of June 30, the area where affordable housing is required has been greatly expanded, and includes Downtown Brooklyn).

Vince Tabone, Red Apple Group senior counsel: This project would not be viable but for the old 421-a. As it is, it’s only because of his economic wherewithal — he’s fronting the financing for the first phase while we’re negotiating with the bank so that we could have made that deadline.

You said you haven’t closed on the construction loan. Does that mean it’s not certain you’re going to move forward?

We’ve negotiated, and the banks are being a little more onerous than they used to be, but we feel it’s probably going to close. But it’s not a slam-dunk.

How much money in bond financing were you seeking per unit?

Lets call it 100 just to multiply it easily. 100 units, $25 million, it’s $250,000 per unit (total, or $1.25 million in bond financing per affordable unit that would have been created).

How do you think that the construction of all this new luxury or market-rate housing in Downtown Brooklyn impacts the lower- and middle-income residents?

First of all, market rate has a dual meaning. It is market rate as far as something you’re buying in Brooklyn. But it’s half price from Manhattan. So, I would almost consider it affordable- to middle-class housing at that market-rate. Even if we decided to sell them as condos, you’d be selling them at $600 [per square foot], $700 bucks maybe, versus Manhattan, which is anywhere from $1,200 to $1,500 a square foot. So, I would almost put it in the category of affordable, middle-class housing.

To people in Manhattan. But it’s not affordable to a lot of the people who are living in that neighborhood right now. Would you agree?

Then we might as well build nothing because we couldn’t build nothing. For whom do the bells toll? Think about it. I mean, should the taxpayers dish out money for affordable housing? Okay they’re willing to, but they ran out of the bonds.

So, you’re saying that without the subsidies housing can’t be built that is affordable to people living [in that neighborhood right now].

But then they’re already living there. If you want to bring in more people at those rates, then probably not. Where would you bring them in from, if they already have homes?

What about wages then? What could be done at the other end so more people could afford these houses?

Well, as of right now that’s not my department as far as wages … I worked at the Chamber of Commerce for 12 years at the West Side of Manhattan when the West Side of Manhattan was going through a revitalization. And the one thing I learned was, if business is doing well, people in the community are doing well. And if you want to kill businesses then people are not going to do well either, because there are not going to be the jobs.

Do you think prices are dropping because people have to put a higher percent down on their mortgage or because people are losing their jobs?

It’s a combination of both. I think a year ago, if we’re selling condominiums for $600,000, you go to the bank and borrow $550,000 and everybody would say, Okay, I’ll put $50,000 down on a down payment, my condo will be worth $800,000 a year from now,” and everybody has a good time. Now the banks are requiring the old-fashioned mortgages and not everybody has $120,000 to $140,000 for a down payment, so that’s one factor.

The other factor is, there’s a fear coming across Wall Street with the financial institutions, with the banks, Wachovia, all the investment bankers. There’s no deals being done. When there’s no deals being done, the next thing that happens after no deals is layoffs. That shoe has not dropped yet but the people working for these firms know that that shoe is about to drop because … that financial market is not going to turn around in 60 days.

So, is there a solution on the city level that can help ease us through this transition?

What’s going to happen is, people are going to [batten] down the hatches. And if you’re living in a rent-stabilized, rent-controlled apartment, you’re not necessarily going to decide to move to a larger apartment that might be market-rate right now.

For a while there was a lot of movement, and theoretically there will be more in the future. As the city continues to redevelop itself, do you think there’s something the city could be doing better to reduce the displacement of residents [and businesses] as it reshapes itself? Brooklyn in particular we’ll talk about.

There’s no displacement of residents that I know of [Downtown]. There’s no residential buildings that are really being torn down that I know of, and it’s just like I said, people have to stay where they are during a possible recession period

… When I grew up on 135th Street, my father was paying $48 a month rent. My father was a waiter and a bus boy. He wasn’t about to move into a $1,000 a month apartment just because he didn’t like living on 135th Street. I don’t know of any apartment buildings of great degree — maybe one, two, three, a small degree — that were torn down. And sometimes those people are paid large monies to displace themselves … But we’ve never torn down residential buildings.

… I went to Brooklyn Tech High School. I remember Dekalb Avenue, I remember Fort Greene Park was a combat zone. We never walked alone on those streets, we always had at least six guys with us. So, I remember those neighborhoods. I remember Myrtle Avenue when I first bought it 25 years ago.

Why did you buy it 25 years ago if it was a war zone?

It was a war zone. Because Long Island University was selling it. I looked at is as an opportunity to buy three city blocks for $400,000 or $500,000.

Now there’s a lot of new construction underway in Brooklyn, and of course across the city but again we’ll stick to Brooklyn. And the economy right now — the lending practices are tighter, the economy is beginning to sour. Do you think there are certain neighborhoods in danger of having a lot of uninhabited apartments, or half-built projects, or vacant lots where there was supposed to be something built, like in so many other cities across the country?

In Buffalo, I understand there’s 20,000 vacant homes.

Right. So, do you think that’s going to happen to places in Brooklyn?

Like I said, New York City is the greatest city in the world. And I think there’s a possibly of prices coming down to meet the needs of the people. And when the banks stop lending and I want to sell a house, there’s such a thing as seller financing. When the seller owns his house he can take a small down payment from the buyer and give him back a purchase-money mortgage (a loan provided by the seller as opposed to a bank, often given when the buyer is unqualified for a commercial mortgage).

And then in terms of jobs that would fill those buildings with people?

If you have less construction — and I think it was a terrible time for the city to have 421 go away — because if you have less construction, all those people who have been working construction jobs because the city’s been booming the last two, three years, you’re going to have a lot less work around.

Well, do you think that those construction workers are the people who are going to be filling these new apartments in Brooklyn?

Not necessarily.

When do you plan to formally announce you’re going to run for mayor, if you’re going to run for mayor?

We’re certainly looking at it very carefully and we’re thinking of forming an exploratory committee over the next month or two.

Did you change your party affiliation from Democrat to Republican already?


And why did you do that?

Because I’m a moderate businessman. I believe business has to do well for people to do well. And a moderate businessman, the Democratic Party hasn’t nominated a moderate businessman in over 100 years … And I think when things are tough, you need somebody tough to manage the city.

What makes you tough?

40 years of surviving in business.

0 Comment

  • I can’t see this guy getting elected but i like the fact that he speaks his mind with no b.s.

  • How’s the guy supposed to build affordable housing if there are no bonds and the market-rate segment, which ultimately subsidizes the affordable, is crapping out? FUREE wants him to just suck it up and spend his money stupidly?

  • I have a mixed review on Bloomberg’s tenure, but this guy is absolutely repulsive.

    In general, I don’t think real estate moguls should run any city. It’s like having oil people run foreign policy, and we all know what a mess that has turned out to be.

    If I were a political cartoonist, this interview would look like one of those old Nast cartoons – a bloated behemoth with his huge feet crushing displaced residents and homes, while saying “I don’t see any displacement. There is no one here.”

  • I love how the people for “racial equality” always end up whining for a free ride. FUREE has to be the most absurd organization in Brooklyn. Their logo alone inspires nothing but contempt in anyone who appreciates freedom and equality under the law. I honestly believe we should start a fund to pay for their repatriation to wherever they come from. If Brooklyn is so bad and white people are so exploitative, why stay here? I have no interest in paying for their homes, but transportation and relocation expenses to their place of origin? I’m all for it. Their website seems to indicate they value hard work. Perhaps their labor would be of more use in less developed countries?

    Anyway, good interview by Joe.

  • Lack of housing bonds caused the lack of affordable units? Believe it was the Times (maybe the News) that said this would happen. Atlantic Yards subsidies have essentially eaten all of the funding. And with AY affordable housing not being built til . . . god only knows when, other developers lose the opportunity at the same funding pool. Bottom line – despite the rhetoric, the con that is Atlantic Yards affordable housing is actually having a negative, not neutral, impact on the number of affordable units being built in the city.

  • Montrose

    He isn’t referring to the city as a whole, he is referring to Downtown Brooklyn – FUREE’s sacred domain. Who has been displaced?

    Why don’t you compile a list of residential properties that have been demolished. I imagine you’ll find there are very few, and even fewer, if any, that involved eviction of tenants without compensation.

    He 100% right that development in Downtown Brooklyn has not involved displacement of anyone, not that there is anything wrong with such displacement.

  • Who is asking/writing the questions, Acorn? Furee? I mean, come on. Furee is fringe, as this editorial makes the case…

    By what logic should this guy be forced to use his own money on his own property to build apartments for people who can’t afford them on their own?

  • Heil Polemicist! Mein it gott dunkoff Asshat!!

  • There are a variety of ways that affordable housing gets built, but in the end it is usually one government subsidy or another. My assumption is that John C. is refering to 80/20 bonds, of which HFA is issuing for only 4 projects this year (including the Forest City DeKalb project). While I understand that there are a variety of subsidies for Atlantic Yards, I would be surprised if AY was taking 80/20 bond allocation from projects that are going up now.

  • ” I honestly believe we should start a fund to pay for their repatriation to wherever they come from.”

    Hey I will chip in to send all you city hijacking Asshats back to the Fly over states and Clowniforina!

    “f Brooklyn is so bad and white people are so exploitative, why stay here? I have no interest in paying for their homes, but transportation and relocation expenses to their place of origin?”

    Mad GOD have your ass-kicked by a band of Black youths!

    “Anyway, good interview by Joe.”

    Hey Polemicist, why just profess your love for him and blow his Man-Love!

    The What (200= posts on this crap)

    Someday this war is gonna end..

  • Polemicist, you really live up to your handle.

    “back where they came from”!? Do you really believe only immigrants support affordable housing? Or FUREE? And even if only they do, is that a reason for the vitriol?

    Even if one does not support FUREE’s agenda, if you believe there’s no racial inequity you’re sadly misinformed.

    MM, Right on. It would be a sad day for NY if this compassion-challenged “moderate businessman” were to become mayor.

  • Polemicist, this is the first time you’ve decended into racial profiling, and while I disagree with you about 99.9% of the time, I have never thought you’d sink that low. Since you act as if you are privy to the incomes, jobs status and living arrangements of all of FUREE’s membership, I guess that gives you the right to tell them to go back where they came from. Wait, they came from here, damn. I have big issues with some of FUREE’s demands, but I applaud their temerity to stand up for the seemingly unpopular notion that everyone needs a place to live.

    Since you don’t think that low density housing such as 19th century row houses and tenement buildings count as residential, then I guess the displacement of people from the back end of downtown, near Duffield, Bridge St, Willoughby, etc, count for much. And maybe they don’t, from a numbers perpective. But they are still people displaced, none the less, and should be counted by someone.

    If you are ever told you have to move for the greater good, and someone’s grand plan, please let us know your feelings about not being counted then.

  • I think the money he’s going to spend on an “exploratory committee” for a mayoral run would be better spent on a stapler exploring his stomach.

    Jeez, this guy is a slob. In all senses of the word.

    And his grocery stores suck too.

  • “By what logic should this guy be forced to use his own money on his own property to build apartments for people who can’t afford them on their own?”

    He is not forced to do anything. If he wants to build whatever he is allowed on his own as of right, he can do what he wants. If he wants to receive, or do something that requires, some kind of public concession — in the form of subsidies, tax breaks, variances etc. — to which he is not automatically entitled, by what logic should the government fail to obtain some kind of public benefit in exchange for its largesse? We can disagree as to whether affordable housing is a public benefit, but if you want something extra from the public fisc, you should be prepared to be expected to contribute something for the public good.

  • Gristede’s does suck. When I lived on the UES I would go there only to get the Mother Goose Liverwurst which no one else carried. Imagine my amazement when I saw it at the Super Foodtown on Fulton Street. There is a god. He looks like he should lay off the liverwurst.

  • I’d hardly call him a real estate mogul – he’s not a Trump or a Rattner or a Gottlieb from the West Village. He bought a couple of blocks 20 years ago because he had the cash available. What were the rest of us doing 20 years ago? Have we brought ourselves up from nothing to be able to afford anything for 4 or 500K? I haven’t.

    And, so what if he’s, well, “overweight”? So is Oprah and she’s got more money and power over the people than he does!

  • Some people used to do things for the greater good without being compensated for it.

    Those people are becoming more and more rare.

  • Montrose,

    I’m not the one who has started an organization that states there is 1) racial inequality and 2) that inequality is best served by taking money from other people.

    Their demands fly in the face of any notion of liberty, property rights, or the equality of man under the law. In essence, their demands border on sedition and are at the very least morally repugnant. FUREE is a racist organization, and really has no place in any kind of legitimate discussion of public policy in New York City.

    As for your comments regarding so-called displacement, a townhouse owner who sells his property is not displaced. He is like any other seller. As for the rest of your nonsense – Bridge Street? That has never been a residential area since the Dutch sailed into New York Harbor centuries ago. How on earth could anyone be displaced there? I believe you are suffering from a delusion common to many anti-development types – you incorrectly assume that new construction always involves displacement when the truth is that it rarely does as Joe makes clear.

  • Now we know the registered what is an impostor – s/he was never so easy to troll in the past!

  • I love you, What. I fell of the chair laughing!

    You’re right, 11217- I have visions of him with a map of Brooklyn, with the neighborhoods defined by little colored wood pieces that he shoves around with a fork (full of food)to create new neighborhoods. Polemicist would advise him so all the little black and brown pieces eventually wind up in the Atlantic. That’s their game plan.

    SNL was right- there really are Landsharks.

  • “Their demands fly in the face of any notion of liberty, property rights, or the equality of man under the law. In essence, their demands border on sedition and are at the very least morally repugnant. FUREE is a racist organization, and really has no place in any kind of legitimate discussion of public policy in New York City.”

    So Furee’s policies give you the right to interject your racism and morally repugnant attitudes into a legitimate discussion of public policy? Your comments come right out of Mein Kampf, – people like you are the reason organizations like FUREE exist today. While you carry on about property rights and equality, it might serve you to remember it was white people with attitudes like yours that brought slaves to this country as property and denied them liberty and equality.

    Obviously neither you nor “Joe” ever spent any time in that area. I did- there were plenty of residents. Just because you didn’t see something doesn’t mean it didn’t exist.

  • Polemicist, why do you have such a deep love for bashing FUREE? What have they done to you? Can’t help but think that you doth protest too much – that you’re so infuriated by FUREE’s message and work because they’re pointing out inequalities that benefit you, and somewhere deep down inside you know it’s true.

    Anyhow, on the topic at hand – it’ll be a horrible day for NYC if Catsimatidis gets elected. How can someone who seriously hopes to put himself forth as a candidate for mayor so cavalierly dismiss a question about wages and helping people afford housing? “Well, as of right now that’s not my department as far as wages”? This guy wants to be mayor in 2009. Exactly when will all city residents’ financial well being (as opposed to rich developers’ well being) become his department? Oh, that’s right – probably never.

  • Polemicist, I clearly stated that I had big issues with FUREE’s mandates. It is not an organization that I would join or support. Sedition is a bit strong, don’t you think? Some of the ideas you’ve cooked up over the years have been equally seditious, depending on one’s outlook, and which side of the wrecking ball you happen to be on. American rights extend to those less fortunate than others, as well. Affordable housing is a societal necessity. Get over it. A civilized society makes sure that people have shelter. Maybe you don’t want to pay for it, but you will anyway. I’d prefer to have my taxes help subsidize the building of homes, rather than jails, or massive homeless facilities. That’s just me.

    I said Bridge St area, with Willoughby, Duffield, etc. I was defining the scope of the area, not giving an exact address. It’s a pretty lame argument to pick on the details, not the message. Catsimitaditas is not interested in affordable housing, unless we pay for it. I suppose I should admire his upfront attitude, but I don’t. A mayor of New York City should be the mayor of everyone, not just those who can afford his apartments or his gourmet groceries. That is my big problem with Bloomberg, he is clueless about the everyday lives of those without. Big John seems to think the problem can just be moved out of the way.

  • MM you’ve apparently never been in a Gristede’s…they are far from upscale.

    On your other, arguably more important points, I agree.

  • “When I grew up on 135th Street, my father was paying $48 a month rent. My father was a waiter and a bus boy. He wasn’t about to move into a $1,000 a month apartment just because he didn’t like living on 135th Street. I don’t know of any apartment buildings of great degree — maybe one, two, three, a small degree — that were torn down. And sometimes those people are paid large monies to displace themselves … But we’ve never torn down residential buildings.”

    What drivel. “paid large sums” happens very rarely.

    and while Gristede’s may not be upscale in appearance it certainly is in prices. the prices are far from Pathmark….

  • I’d like to also point out exactly what he did say: “”There’s no displacement of residents that I know of. There’s no residential buildings that are really being torn down that I know of,”

    Odd- isn’t that something he should know? If nothing else Bloomberg is a control and detail freak- Catsimatidis comes off so lackadaisical and blithe that I seriously doubt he has the wherewithal or the personality to be a mayor.

  • Dave, the last time I was in a Gristedes was maybe 6 months ago at the one in the Village on Mercer and 3rd (I think), which was on the way to my former job. It was expensive, but certainly not a visual temple of food, like the Food Emporium under the 59th St Bridge. In fact, I was suprised at how seedy the interior was, considering.

  • Rule #47 about trolling:

    You always know you’ve whipped up a wild frenzy when the old Reductio ad Hitlerum enters the conversation.

    Simple minds are easily manipulated. A puppy cries when its fur gets wet. A less intelligent human, when he faced with someone who doesn’t agree with them, declares the person a nazi

    bxgirl: Your drivel never ceases to provide me with comedic relief. I love to see the results of those hamsters jumping around in that noggin of yours.

    Montrose Morris: Affordable housing is by definition housing financed by the government. It seems you don’t believe in property rights and expect other people to give you the good life for free. Why don’t you go to the farmer and tell him to sell you grain and vegetables for a lower price? Or maybe even go to the bank and ask them to forgive your debt?

    This is the United States. You do not have a right to another person’s labor. You do not have the right to live wherever you feel like. Communism has failed. Slavery is illegal. You have no basis for your dreams, whether legal or evidential.

    You want a house? Go to Maine where you can get land for $1,000 an acre and build one. Want some food? Get some cows and graze the land and plant some potatoes.

    Civilization, by definition, is one where the rule of law – and not animalistic whim – guides human behavior. Civilization is not defined by what people get, but how they behave. Civilized people are not those who are given food and shelter in exchange for their votes. Such people are more similar to slaves or prisoners than free men. Civilized people respect the independence and autonomy of other people and abhor violence as a means of interacting with others.

  • yes MM, thats why I was surprised when you referred to it as “gourmet groceries” That said, nothing beats a D”Agostinos for incredibly awful produce, meat and fish.

  • Gristedes stores are awful. Catsimatidis is even worse. And calling his groceries gourmet is akin to calling White Castle Per Se.

  • Hmm, Dave, come to think about it, the Mercer St. store may have been a D’Ag’s. Same difference.

    Polemicist, give me a break. What drivel. You may say it well, but it’s still drivel.

    I suppose there is no room in your Darwinian Declaration of Societal Isolation for the biblical mandate to feed the hungry, clothe the naked, give drink to the thirsty, and give shelter to the homeless. Too bad for you. You’re missing out on the reason we are here – to help each other out, and think and do beyond our own selfish wants and needs. We certainly don’t HAVE to, but I’m glad some of us still do.

  • Polemicist: Bravo. Bravo.

  • Polemicist- at least I have something dancing around in my skull. What’s the matter- too afraid to take on the what or were you too dense to get his german reference? You spout all manner of racist crap, you post wholly ignorant architectural information, and your social analysis is so primitive that I wonder if you even realize you are in 21st century America. You don’t even know the first rules of civilized behavior as well evidenced by your list. Yet you think I post drivel? Well, coming from a severely uneducated, racist and socially backward person such as yourself, I and my hamsters take “drivel” as a compliment. It’s a helluva a cut above anything you capable of posting.

  • Most of the people living in subsidized housing have jobs, and they can’t afford market-rate housing because their jobs don’t pay enough. They don’t pay enough partly because the products and services produced by those jobs need to be kept affordable to the consumer, and in other part, so the shareholders, business owners, and high level excutives (i.e. people living in market rate housing here) recieve a greater level of profit/ pay.

    Now if all these people you like to call low lifes were getting paid $100G, maybe they could afford unsubsidized housing, but then prices on everything would go up and your paycheck and/ or stock dividens would go down, therefore you wouldn’t be able to spend as much on both ends. And then you’d complain about that. You would say they don’t deserve to get paid $100G for bagging groceries or teaching schoolkids or taking your money at the cash register, or cleaning up the dirt left by your shoes after you walk down the hallway. But then you also say they don’t deserve to have the government step in and help create housing that is affordable to them so they can live in the city that they work. What exactly is the solution?

    Don’t you see that the government is also helping to subsidize your high-end lifestyle? And union construction wages.

    And I would also like to point out that it’s the developers asking for all these subsidies to create apartments that cost less than $600G. I’m sure that most low and middle income people would prefer not to have the stigma of living in housing that the government helped create, but the cost of housing is so expensive now, and there’s such a limit of decent, affordable housing on the market, that the government does have to

  • step in. just as John Catsimatidis said in the interview, he won’t build housing affordable to low and middle income brooklynites because it’s not profitable enough to make it worth his while. note the word “income.” that means these people are working.

    i don’t see you suggesting that they get raises! you try looking for an apartment for your family in a safe neighborhood pretending you make $35G a year, which would qualify them for one of these below market units at below 60 percent median income. that’s what cops make to risk getting shot to protect you. don’t you know a lot of the people living in mitchell lamas work for the government? or are providing some service to you from the private sector? all these people are working for you! and only making enough to scrape by in this city. at least be somewhat grateful.

  • P:”Affordable housing is by definition housing financed by the government.”

    Rubbish. Affordable housing can be built without subsidy, as evidenced by many places and organizations, including Habitat. What you’re really saying is that if Cast. can build luxury housing for twice the price, why should he not do so? Well, here’s one why.

    Almost by definition, the ability to use your land is controlled by the public (ideally) in the form of zoning, tax subsidies, what have you. Property “rights” are assigned and are revocable (just ask Daniel Goldstein.)

    Now it should be clear that building to diverse residential specs. is preferable than the mono-culture of the suburbs, for example. If you don’t think that affordable housing in Brooklyn or NYC in general is a good idea, you probably believe in living in one of the gated communities is a good thing, and should ignore this post.

    Luxury housing pays for itself, and is the preferred style being built. So “affordable housing” (which in itself is a misnomer, since it caters to well above the middle class,) has to be built either 1) by a measure of coercion (zoning/planning) or 2) by subsidy. But in either event it’s just a payback for the rich getting all sorts of other hand-outs.

    “Civilization is not defined by what people get, but how they behave.”

    More rubbish, that’s civility. A decent provision for the poor is the true test of civilization (Johnson.) Obviously you are not in tune with civilization as we know it.

  • “Montrose Morris: Affordable housing is by definition housing financed by the government. It seems you don’t believe in property rights and expect other people to give you the good life for free. Why don’t you go to the farmer and tell him to sell you grain and vegetables for a lower price? Or maybe even go to the bank and ask them to forgive your debt?”

    Here’s one for you poly, “all” housing is financed by government. The value of the mortgage interest deduction enjoyed by so many hard working Americans dwarfs by magnitudes of hundreds of billions the amount spent on all public housing and subsidies. That doesn’t even account for public money used by developers. It’s such standard operating procedure that the $400 section 8 voucher is pilloried while billions of $$$ of middle and upper class housing subsidies are treated as matters of right and principal. I have no problem with the deduction per se, but I’m not going to relable it as something other than what it is – a handout.

    You seem to have a selective interpretation of free market; farming and banking are fueled by federal, not private, largesse. From day one in our country we’ve had a mixed economy but for people like you apparently it’s myth busting to hear it.

    As for your transparent incendiary for this discussion, about starting a fund to send people back to where you imagine they’re from. I guess there are some causes for which you’ll abandon your no handout principles, huh? Newsflash, folks who’ve been grinding for the poor and to be heard among the powerful have heard that one before. I wouldn’t keep my fingers crossed.

  • Jeez Louise put away the steely knives. Too much drama. Too much class warfare. People in this city of every race and creed manage to get along fairly well 99.8% of the time which is pretty remarkable. For all its failings we should not lose sight of that.

    Look I only know what I read in the funny papers and the other day Fannie Mae and Freddie Mac almost went belly up along with Wall Street, the U.S. Real Estate Market and US Banking system. This guy Catsimatidis seems a bit to honest to be a politician so maybe you are right that he will never be Mayor but the day groups like FUREE (clearly an intentionally provocative miltant acronynm) can “protest” so that business people MUST fund items in the public interest is the day New York really does become Moscow on the Hudson. The politicians lining up with FUREE shoudl get back to work and expand the tax credit program instead of takingto teh streets. What are we France?

    The reason that tax credits and tax abatements exist to subsidize affordable housing is because given the cost of NYC labor and compliance costs (DOB, DOT, and dozens of other alphabet soup agencies) no bank will finnace a project with low rent rolls. Low rent, High cost = no steel going up. From what I’ve read the guy has said that when credits become available and he can finance it he will do affordable units on the rest of the three blocks he owns. Seems fair to me. Just because he is a straight shooter and overweight is no reason he should have to capitulate to these clowns. If he did that I would say he does not have the right stuff to manage this “gorgeous mosaic” of a city.

  • I really didn’t want to comment, but I’ve got to correct brine deez’s intentional or unintentional nonsense. The mortgage interest deduction is only taken by those who itemize their deductions. Recent figures suggests the deduction benefits relatively few homeowners (though NYC with its high home prices would be a prime candidate). But the idea that the amount of mortgage interest deduction even exceeds the amount spent on public housing and subsidies, let alone dwarfs it, is absolutely absurd.

    Are you just using outrageous hyperbole to get your point across?

  • at the risk of my hamsters and myself, I have to say after going to the FUREE website that they are hardly the ravenous pack of wolves some people would have us believe. they organizer, true, but they are multi racial, have started education, leadership and voting programs and they are teaching women to be effective in the political and social arena. I don’t see anything in their website that says they are looking for handouts- in fact they got started in response to a workfare/education program that was seriously flawed and they wanted it to be better.

  • bxgrl – its a fairly well accepted rule that the first person to reference Nazis or Hitler in a debate not related to WWII has lost the argument. Stick with your reasoned points if you want to enlighten/convince people.

  • dittoburg, please see what@10:45. although I wouldn’t quite say he lost that argument. (where did you hear this fairly well accepted rule?).

    As far as whether or not I can enlighten or convince anyone of anything I think you need to read this thread thoroughly. If anyone was hoist by his own petard, it is polemicist. and I question why it’s ok to be an out and out racist, as he is, but to equate his ideas with nazism- and believe me there are some real parallels- suddenly means the first person to say it loses the argument. Judging by the posts, polemicist was well answered and out of his league.

  • Gristedes used to be an upscale market, back in the day. Back before JC bought it. He started by owning a Red Apple supermarket, and used his profits from that to leverage into other businesses. He’s done well, but when he bought Gristedes he ran it into the ground.

  • I have to say this.. I miss the Anons! Since Brownnstoner implemented the log on thing, the quality of this Blog went down the drain. Now we have to put with Developer Blow jobs, Cheerleading Asshats, Fart Smelling Dumbasses and Covert Race/Class agents.

    There is no way Brownstoner could post this garbage with Anons logging in. There would’ve put this place on blast! How many hand jobs is up on deck Brownie? only time will tell…

    “too afraid to take on the what or were you too dense to get his german reference?”

    bxgrl, Polemicist is a punk! He knows better!

    What is so discussing that people is even considering this Asshat for Mayor? About 12 years ago there was fires around his supermarket. They was the work of Asonist because BIG RED (Numbers Newspaper for the Hood) was there. Hey Sarah ow about doing some “Reporting” on that instead of giving him “front and back”!

    The What (Let”s see if this gets censored)

    Someday this war is gonna end..

  • Bxgrl this is it!

    Godwin’s law's_law

    Godwin’s Law (also known as Godwin’s Rule of Nazi Analogies)[1] is an adage formulated by Mike Godwin in 1990. The law states:[2][3]
    “As a Usenet discussion grows longer, the probability of a comparison involving Nazis or Hitler approaches one.”

    This is a shield so Asshats can hide behind to spew their racism!

    For example, there is a tradition in many newsgroups and other Internet discussion forums that once such a comparison is made, the thread is finished and whoever mentioned the Nazis has automatically “lost” whatever debate was in progress.

    Notice one thing.. No Asshat attacks on The What!!!

    The What

    Someday this war is gonna end…

  • I’m impressed by the Whats research skills.

  • While I do enjoy rousing the rabble a bit, I do want to stay someone on focus.


    Within the context of New York City, affordable housing refers to housing that is constructed with government subsidized bonds and/or grants in exchange for the units being rented to people who have a household income within a specific range.

    Habitat for Humanity is a different story, but it’s impact on the market is really irrelevant. It’s a nice, feel-good concept but it is untenable. People who work for free never make a significant contribution to any economy unless they are already wealthy.

    If you read my posts more frequently, you would find it quite clear that I believe people should be allowed to develop, with minimal restrictions, any kind of housing they wish on their property. It has been proven time and again that the housing shortage in New York City is directly related to the city’s zoning laws (which actually create something akin to the gated communities you abhor) and the likely expansion of rent stabilization, which results in developers not wanting to undertake the risk of building rental property. In which cities is housing in short supply? New York and San Francisco, the two cities that practice rent control and severely restrict building density.

    As for your definition of civilization, you clearly haven’t read any of the great pioneering works on the subject like Edward Gibbons’ Decline and Fall of the Roman Empire and Oswald Spengler’s Decline of the West. Your beliefs are shared by most of the third world – places that live in societies far less prosperous than the average city in the Roman Empire 2,000 years ago. Think about that, and perhaps even read the books I mentioned.

  • I think I’m going to gag… Polemicist Pompous Asshat. Excuse me sir, you have Grey Poupon dripping off your lip. Or is it John Catsimatidis after birth?

    The What: Tough Guy For Tough Times

    Someday this war is gonna end…

  • Kishke anyone?

  • I tell you, this imposter of the what is just so pathetic. What ever happen to the real economics discussions?

  • Dittoburg, I’ll continue our polite discussion. It’s not easy getting this data on the fly but I’ll provide some links below. As you may know, whenever a tax is not collected by the government, the foregone taxes are treated as expenditures. The two expenditures, foregone mortgage taxes and spending on housing assistance programs for the poor renters can be compared “apples to apples.”

    What originally brought my attention to these numbers and how public perception was so off with regards to this issue was a published study I read from the early ’90s. The exact title of the volume I have in mind escapes me (but if the volume isn’t packed away in my home I’d be more than happy to provide the title if you are interested).

    Googling around just now, and granting that these are raw data only, in 2005 the value of the mortgage interest tax deduction was $69 billion. Add in the amount of other residential tax breaks and the figure is closer to $150 billion annually. Conversely, from the US 2009 HUD budget, the entire HUD budget for all housing programs for renters (including seniors, disabled, veterans, etc.)is $47 billion.

    You also raise the issue of who benefits from the deduction, and you are right, the bulk of the benefit goes to small segment of the population (80% of the benefit goes to the top 20% in some estimates I’ve seen). This distribution has no bearing on how much is spent on each constituency.

    All this to say, no hyperbole here. The fact that you find it hard to believe is not surprising. One group of beneficiaries and their allies is weak, the other, less so.

    A link to the HUD budget:

    A link to the article where I got the $69 billion figure:

    See also:

  • “New York and San Francisco, the two cities that practice rent control and severely restrict building density.”

    You just named arguably the two best cities in this country.

    I can’t stand reading your posts, but since I appreciate freedom of speech, we’ll keep on keepin’ on.

    You are showing your age, Polemicist. I’m hoping you mature a bit as you move into your 30’s.

  • 11217 – calling someone a kid is hardly mature now is it?

  • I wasn’t calling anyone a kid. Polemicist has said before that he isn’t yet 30, and I’m simply stating that his ignorant and misinformed posts would show that he’s got a lot to learn about life.

    He speaks as if he’s lived through all of life’s great turmoils, but he’s in his freakin 20’s.

    A well spoken guy, but extremely misled and a lot more racist than I ever knew from prior posts.

  • Thanks, What- I never heard that before. Probably won’t stop me in the future from mentioning it if I see fit (the hamsters won’t let me), and I pretty much equate racism and nazism. Different politics, different language, same deal. And you’re right- it’s a stupid rule to hide behind.

  • “I pretty much equate racism and nazism”

    And vivisectionism too?

  • “People who work for free never make a significant contribution to any economy unless they are already wealthy.”

    No, Polemicist, they just change hearts and minds, and occasionally, a life or two. God forbid, anyone should waste their time volunteering. By the way, those less fortunate often spend as much, if not more time volunteering, than those who have much, much more. They also give proportionally more money to charities.

    I’ll take someone giving sweat equity and time at a Habitat site,for someone they don’t even know, over some know-it-all child in his gilded tower looking down his nose at the toiling masses, any day of the week. You may have some book smarts, but you need some more life education.

  • ah, no, dittoburg. Although the nazis certainly treated people as no better than experimental animals. What’s your problem with racism and nazism? You seem ready to defend both of them?

  • Hey P:

    I’m arguably a free markets kinda guy myself, altho I don’t think it’s a terrible thing to feed the homeless or subsidize housing for people who can’t make it, but I believe you’re a bit wrong here when you say:

    “…and the likely expansion of rent stabilization, which results in developers not wanting to undertake the risk of building rental property.”

    What makes you think rent stabilization is being expanded? Only for politicians, it seems. With new vacancy decontrol and income limits, rent stabilization is finished in a coupla decades or so. Simple inflation coupled with these factors will do it in. Which is why suddenly there’s a lot of smart money moving into stabilized housing, like Lenox Terrace, Stuy Town, etc.

  • 11217: NY and SFO are also the two most expensive cities in the country. The existing rent control laws mean you can’t kick out tenants without stringent compensation; great for the tenants, but it locks up 50% of the city’s housing stock… effectively forever.

    Catsimatidis is right, anyway. You can only wave your hands and demand so much affordable housing. We already pay the highest taxes of, what, anyone in the US here? Pumping it into rent subsidies that prevent demolition (and turnover) only makes the tax base more stagnant.

    To put it another way, if New Yorkers already can’t afford their homes, are we improving their situation by taxing them to pay for other people’s homes on top of that? Or are we making home ownership impossible for those who can’t afford a brownstone?

    Displacement sucks and has hidden costs, no doubt about it, but if we demand subsidized housing units in every large construction project, the whole city will be a housing project. And I don’t mean that in a “boo-hoo-hoo-I-hate-the-poor” way, I mean badly designed, badly executed, badly funded, and badly maintained.

  • Theres lots of differences here. And people use the charge of racism very loosely, especially on blogs. In addition, there is no distinction made by commentators between racists and cultural critics. There are many levels.

  • I’m not gonna get into the middle of this, but I do want to point out that Johnny at 10:39 is just dead wrong. I’m no fan of Atlantic Yards – but there is no affordable bond cap that is being reserved for AY that is not being used. Bond cap doesn’t get allocated till the project is actually being built. The reason bond cap is getting used up is because of all the 80/20 projects going on around the city (mostly on the west side of manhattan). Once AY gets going, it will use up alot of bond cap, but at least it WILL be delivering affordable units.
    I now return you to your regularly programmed race baiting and class war.

  • 11217

    I’ve never even noticed your nonsense before, but what the hell. You’re a boomer.

    In regards to New York and San Francisco – they are arguably great cities for what they were *before the imposition of these restrictions*. Both were great cities long before these laws, and I really can’t fathom how you could possibly argue New York City today is better than it was in say the 1920s. Certainly, on a site that largely glorifies pre-war architecture – your cherished laws have done nothing to revive the lost art of decorative architecture.

    As for your ageism, I will just say this dear baby boomer – you and your class are the most selfish generation in history that has squandered everything at the expense of future generations. You know nothing of great turmoil. Turmoil will come when we the full effects of peak oil hit in the next 3-5 years. Even greater turmoil will hit when we youthful fools refuse to pay for the social services you demand. You’re really going to consider euthanasia when people in my age bracket refuse to pay inflated prices for your investments or even you house. Say goodbye to your mutual fund, your 401K, and your home equity. Unless you are rich enough to buy a distant country retreat, I’d say your golden years are going to be rife with turmoil – if you even survive.

    In short, you are part of what will be the most reviled generation in the history of mankind. Rather than sing your praises for whatever hedonistic causes you have championed, your generation will be reviled until it is forgotten.

    Oh, you also have that other terrible boomer affliction – a propensity for political correctness. Let me guess, you thought the New Yorker cover of Obama was horrible, right?

  • The problem with the cover of the New Yorker is that the whole world sees it. People of varying IQ, knowledge and contextual understanding. I severely doubt any New Yorker subscriber will not take it as satire. I also severely doubt that an anti-black racist will not see it as a graphic representation of all his worst fears.

  • “11217

    I’ve never even noticed your nonsense before, but what the hell. You’re a boomer.”

    I’m not a boomer…only slightly older than you actually…I’m just more welcoming of other people outside my immediate circle and better travelled than you are.

    And you’ve “never noticed my nonsense before” because I just started posting yesterday.

    Since you were born less than 30 years ago, I’m wondering how you can be SO SURE NYC was a better place in the 1920’s.

    I’ve lived all over the world, travelled to all 50 states and about 30 countries and absolutely adore living in NYC.

    Just because you don’t find it suitable, does not make it so for the rest of us.

    Your entire boomer rant on someone who is not only not a boomer, but on someone you know nothing about shows how deeply ignorant and rash you are.

    Grouping all boomers together as you’ve just done shows how you are unable to see that people are individuals. You do it with race, you do it with class, and now you’ve done it with an age group.

  • denton:

    A recent phenomenon – and buying rent stabilized buildings is very different than building an apartment building from the ground up. The proof is in the numbers. Approximately 500,000 rental housing units were brought online in the 1950s. Hell, that many were built in the Bronx in the 1920s and 1930s – even in the depression!

    Want to guess how many rental housing units have been built since rent stabilization was enacted?

    Anyway, I absolutely guarantee when the economy tanks in the next year – political momentum to expand rent stabilization will begin in earnest. Such movements always decline during “the good times”. Every developer – especially the wealthy families – know this. Not worth the risk, not when until recently you could sell condos.

  • 11217 – recongizing the characteristics of a class or a culture does not prohibit one from recognizing individuals also. The very use of the concept of cultures and classes presupposes common features. Your argument is no more fair than stating that anyone who sees individuals is unable to see different cultures.

  • Ditto,

    I tried posting a response to you several times but my comments seem to be getting lost in the ether. I’m wondering if the weblinks I embedded caused the problems.

    Perhaps the post will show up eventually. The short version is that there’s plenty of evidence of what I said. Look up HUD’s budget for housing programs as compared to the value of foregone taxes for mortgage interest deductions.

  • BD – HUD is only part of the equation. It seems less than 50% of mortgage owners deduct the interest. They tend to be in the group that pays higher taxes, and therefore already fund a chunk of HUD, no?

  • 11217:

    I really could care less about your personal travels, why you love New York for reasons apparently unrelated to real estate development, or your opinion of me. Go back to your happy life now and pretend those people in FUREE are just like you.

  • “Couldn’t care less” please. Don’t perpetuate that error.

  • dittoburg: thanks for the props.

  • and thanks for the spelling correction – gotta run, but it was fun on Brownstoner today!

  • the mortgage interest deduction can’t stand on the fact that people who benefit from it are people who pay taxes. in new york city how many millions of renters pay taxes but have no similar vehicle for recouping them? a decision has been made to offset the cost of owning financed real estate, nothing wrong with that, but hardly a self evident use of tax resources. On a different note, I wonder if other western countries have similar practices when it comes to mortgage interest deductions.

  • “Even greater turmoil will hit when we youthful fools refuse to pay for the social services you demand.”

    This I would love to see. I really would actually…I’m not being sarcastic.

    I’d love to see young Americans organize and get passionate about something other than standing in a line for 5 hours to get an iphone or a new playstation.

    I’ll believe it when I see it.

  • Brine, I’m getting from you that the mortgage interest deduction is a handout to be factored into the equation, but sub-market rents in housing projects should not be included? You quote HUD, but how much does (e.g.) NYC effectively handout each year in reduced rents? I’ve seen rent figures of 300 or 400 quoted on this board. No-one is denying that these subsidized rents are necessary to keep people in places they know as homes, to prevent the city from becoming a monoculture. But leaving them out of the equation you posed is disingenous.

  • Well I’ll agree with you on the renters not getting any help. I think at the very least credit card interest should be made deductible again, and then on top of the statndard deduction so that it helps those who can’t itemize.

    As far as I know the mortgage interest deduction is not widely found in other countries.

  • gotta agree with 11217 on his 5.40 comment.

  • sometimes the bull—- can be unbearable….John Catsimatidis is a blowhard billionaire who’s trying to make money. In this day and age social services are all we should be concentrating on and the one thing this man (and the rest) are trying to avoid. You can’t really, honestly, be OK with him? Self made man or not, he has a responsibility to the community (both the rich and poor parts of it) just like the rest of us.

  • wow. that was very unimpressive.

    as an aside, if he’s really so cash rich, he needs new counsel and/or banks b/c big developers with cash flow are getting their financing in nyc.

  • I confess that I like a little nastiness on this site.

    I would never vote for this guy.

  • almost forgot –

    fake what sighting.

  • Excellent interview. JC seems like a straight shooting business man.

    The housing shortage in NYC is due to three main factors:

    1) rent stabilization effectively removes 1/2 of the city’s rental housing from the market

    2) land and construction costs are too high in NYC to justify building rentals

    3) the “threat” of expanded rent regulations in this city is real. do a google news search. most democratic reps in NYC favor EXPANSION of the current rent laws and are pushing it hard. They’re trying to get local control of the Rent Guidelines Board so they can take every last property right away from private landlords. It’s vote pandering on a massive scale and it’s a HUGE fear of landlords and developers.

  • Google News didn’t turn up a single article indicating there was any sort of chance that rent regulation was going to be expanded. Please post a link.