The chief complaint was that while other commercial spaces in Brooklyn have seen rents drop by as much has 20 percent, 16 Court has been raising rents, often substantially.
The building’s lawyer-tenants also take issue with their new landlord’s approach to rent negotiations. Several attorneys said that disputes over retroactive increases quickly devolved into eviction proceedings.
Many also said that getting basic maintenance now requires jumping through countless bureaucratic hoops. Renovations have been deposition-stoppingly loud.
“I don’t think you’ll find one tenant who’s happy with the ownership change,” said Scott Rynecki of Rubenstein and Rynecki, who opened an office in 16 Court in 1984 and whose clients have included the families of Amadou Diallo and Sean Bell. “It’s a complete turnaround from the way this building was.”
Brooklyn’s second tallest building, the 37-story structure has sweeping views of Manhattan. Downstairs, the subway station offers connections to a half dozen trains. The entrance to the Brooklyn Supreme Court’s civil section is directly across the street.
SL Green, the real estate company owned by Stephen L. Green, bought 16 Court at the top of the market in 2007 for $107.5 million (Marketplace, NYLJ, Aug. 1, 2007). The company has since invested about $20 million more in renovations, which will be completed by the end of the year.
Among other upgrades, the building features new halls and a redesigned lobby. The façade will be resurfaced and the elevators updated by the end of the year.
Tenants complain that the cost of the work is showing up in their rent statements, mainly in the form of retroactive “porter’s wage” rent increases.
The decision to fight or question the increases has led to quick eviction proceedings for more than one firm. Mr. Rynecki said that when his firm asked for an explanation of the $24,000 bill it received for a retroactive increase, the company responded with a notice of petition and a request for final judgment of eviction.
One attorney who has been in the building for nearly three decades said he recently cut off negotiations over a new lease.
“It seems to me that they’re very inflexible, they’re very rigid,” the attorney said. “We tried to negotiate an extension and they were totally unreasonable.”
Like many of her neighbors, criminal defense attorney Joyce M. David, whose high-profile clients include alleged murderer Darryl Littlejohn, also complained about the ownership’s stiff corporate mentality and the difficulty of having even the smallest problems fixed.
“Things are more formal,” said Ms. David, who has had an office on the building’s top floor for 26 years. “It’s not like you can just call down to the porter. You have to put in a request.”
Sanford Rubenstein at 16 Court’s renovated lobby
Mr. Rynecki’s partner, Sanford Rubenstein, calls the renovations detrimental to both the building’s aesthetics and its safety.
“It’s just a matter of time until someone slips and falls in the lobby,” he said. It is either ironic or short-sighted to put a slippery floor in a building that houses so many tort attorneys, he noted.
20 Percent Rent Increases
Steven M. Durels, SL Green’s director of leasing, said that rents have gone up by about 20 percent since the company purchased the building, putting 16 Court in line with its competitors. The building’s Web site lists a base rent of $42 per square foot. Several tenants said they paid a comparable amount.
Mr. Durels described the increases as a necessary by-product of raising 16 Court from a low-end to a higher-end building, and he called the legal notices an appropriate response by an unpaid landlord.
“If you don’t pay American Express, they turn off your service,” Mr. Durels said. “It’s kind of the same thing with your landlord.”
Tenants had grown accustomed to a loosely run building, one in which the management, Joseph P. Day Realty, neglected such basics as enforcing contractual rent increases and accurately measuring office space, he said.
Under the building’s new “pro-active” management, Mr. Durels said, tenants should expect better services, and to pay a small premium.
Of the complaining attorneys, he said, “They preferred leaky ceilings to higher rent. That’s not the kind of building we want to run. In exchange for that, we want the rent to be paid.”
Minimal Turnover
Complaints aside, turnover has been minimal over the last couple of years. The building has seen a slight decrease in vacancies, falling from about 25 percent when SL Green bought it to about 22 percent presently – an addition of one or two tenants to the 70-plus total.
About half a dozen attorneys and small firms have left 16 Court since SL Green took over. Many, seeking a return to the old days, have moved to another building owned by Joseph P. Day – 26 Court, directly next door.
David J. Doyaga, who recently moved his two-attorney firm to 26 Court, said that he prefers the lower rent and the more civil management to the upscale renovations.
Attorney Louis Rosenthal kept an office at 16 Court St. for 40 years. In the summer of 2007, he tried to negotiate a new lease for a smaller office with the new owners, “but they were crazy with the rent,” he said. When SL Green told Mr. Rosenthal that his previous lease understated the size of his office and demanded to double his rent to $20,000 per month, he called up Joseph P. Day Realty and leased a space at 26 Court.
Mr. Rosenthal conceded that negotiations might have gone differently had he waited just a few months for the market to fall – he has heard of other tenants, he said, renewing for their same rent – but he has no regrets about moving.
“The landlord [at 26 Court] is a doll. The windows are tight, the bathrooms are clean,” Mr. Rosenthal said.
Still, there are several reasons for lawyers to check out the 6,700 square feet of office space presently available at 16 Court.
SL Green, hoping to keep 16 Court’s status as a go-to building for attorneys, has teamed up with the Hudson Valley Bank to provide occasional free CLEs.
The downstairs storefronts, which currently include a jeweler, a Duane Reade and a small kosher take-out market, may soon include artier tenants, a marketing strategy pioneered with great success in nearby Dumbo.
And the recent fall in prices for commercial real estate in Brooklyn – about a 20 percent drop from a year ago, by one broker’s estimate – means that prices may be more likely to go down than up.
Ms. David, whose penthouse looks over the Brooklyn Bridge and lower Manhattan, suggests another reason why even Manhattanites may want to cross the river.
“If you live in Manhattan,” Ms. David said, “all you get a view of is Brooklyn.”
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