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The High Cost of Leaving


By the time the landlord paid Bronstein and two other holdout tenants to leave, thirteen others (many of whom were also represented by Karlsson) had moved out for less money. "There were some immediate buyouts," Bronstein remembers. "The landlord tried to settle with me directly and cut the lawyer out. I said no, but the landlord did do that with one person -- and Kent took him to court and got his fee."

With his buyout, Bronstein could afford to buy a thirty-fourth-floor one-bedroom apartment on the Upper East Side. "I have a beautiful, unobstructed view," he says. And for a two-bedroom Murray Hill rental on the site of Bronstein's old building, the same landlord is now charging $3,500 a month.

To get tenants to clear out without holding up construction deadlines or going to court, developers have taken to retaining third parties to help deregulate buildings as quickly and quietly as possible. Arthur Zabarkes, a former director of New York University's Real Estate Institute, has created a sort of sideline to his development-consulting practice, hiring himself out as a middleman to help broker these building turnovers. "I jokingly introduce myself to people as someone who evicts people for a living," he says.

It's a job that takes some detective work. Before making anyone an offer to leave, Zabarkes culls information on tenants' ages, salaries, and living situations. To ferret out the rent-regulation cheats -- the illegal subletters, non-primary residents, and other breakers of arcane renters' rules -- he'll check the phone company's reverse directory to see if the people with phone lines in the building match the names on the lease. He'll talk to the doorman or super to see if they've noticed the absence of certain tenants around the building lately. He'll hire private investigators to check each tenant's credit reports -- to see how they're spending their money and where. Typically, he says, as much as 30 percent of any given regulated building contains people who can be evicted legally.

His next step is to pump the building's super for gossip, trying to gauge who might accept an overture for a buyout. "Am I dealing with a cranky 80-year-old, or am I dealing with a sweet 24-year-old who's lucky to have the apartment?" he says. "I divide people into categories: Those I think are most likely to leave would be the younger ones and the ones paying the highest rent." The overall goal, he insists, is to keep tenants whistling even after showing them the door. "I virtually become one of their relatives -- I want them to be happy in their new apartments. I have people who call me and say, 'Gee, the oven's burner doesn't seem to work.' I have a tool kit, my Milwaukee half-inch power drill, and lots of drill bits and plaster -- because I would fix apartments for people who didn't have a clue about fixing their own things. Sometimes my wife wonders if I don't have a new family."

James Austrian, another turnover artist, has spent more than two decades specializing in clearing vast swaths of real estate with buyouts; his greatest hits include the midtown sites of the IBM corporate headquarters and Philip Johnson's AT&T tower (now the Sony Building). To pull it off -- to get a tenant to settle without a fight -- he's become something of a hybrid salesman-broker-Santa Claus. He'll offer to move you to a neighboring market-rate building, where his client would gladly bankroll an annuity to cover the difference in rent. He'll give you the down payment on a new home. If you're skittish about plunging into the city's insane housing market, he'll scout places himself, sending you photos or videos of prospective apartments. Will he pay your moving costs? Of course.

And if it turns out that what you really want to do is to leave town, he's your man. Austrian has been known to fly tenants to Florida for a week, direct them to the front door of a brand-new condo, and announce that if they agree to settle, he'll put a new Chevy in the driveway. It's a bit of a Bob Barker moment, and few people say no.

"Someone once told me they had family in Trinidad and couldn't get them visas," Austrian says. "Well, I have no authority over this, but I know people who are lawyers and people in government. So I made it happen. To the tenant, it was priceless."

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