This article was first published in the December 2006 issue of Socialism and Liberation magazine.

For millions of workers, paying rent is a monthly struggle. It is the top priority for most families—coming before food or clothing, much less relaxation or having a good time.

But where does the rent check go? It goes straight into the pockets of the landlords, that group of capitalists who




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Many of the 25,000 Stuyvesant Town and Cooper Village residents in New York City now face the possibility of major rent hikes.

Photo: Don Emmert/AFP/Getty Images
makes its fortunes not by hard work but by virtue of owning property.

Who are these landlords? In some cases they are workers themselves who rent part of their homes to help pay the mortgage. But that is the exception.

For most people, the image of the real estate capitalist is someone like Donald Trump, famous for his flashy hotels and Atlantic City casinos as well as his television shows that glorify the life of the capitalist. In many ways, Trump is a good example of the landlord par excellence. His vast fortune is such that in January 2006, he sued a biographer for claiming he was “only” a millionaire and not a billionaire.

But unlike Trump, most of the real estate capitalists keep a low profile. Most workers will never meet them nor even know their names. While families in cities like New York City struggle to pay at least $1,000 a month, big capitalists are collecting billions.

A $5.4 billion purchase

Take the case of Peter Cooper Village and its sister community Stuyvesant Town, a 110-building site on the east side of Manhattan. In October, the insurance giant MetLife sold the massive housing complex to Jerry Speyer of Tishman Speyer Properties for $5.4 billion. That is more than the gross domestic product of Nicaragua by official exchange rate estimates.

Some 25,000 people live in Stuyvesant Town and Cooper Village. Thanks to rent stabilization, it has been home to many middle-income, working-class residents. That may change.

Speyer wields billions of dollars not for the purpose of providing housing but for turning a profit. His property company partners with BlackRock Realty, which recently merged with Merrill Lynch Investment Managers. BlackRock controls assets of over $1 trillion.

The real estate mogul assured tenants there would be no “immediate” conversion into condominiums or cooperatives. But tenants are worried about the preservation of affordability. Some tenants are looking at a 25 percent rent hike this year alone, which could place many of the buildings’ rent-regulated apartments at market value—and out of the price range for any but the wealthiest.

Michael McKee, treasurer of the Tenants Political Action Committee, called the sale a “dark day for affordable housing.”

Pinnacle gentrification

Another New York City real estate tycoon has been profiled recently in the news. Less than 10 years ago, according to a Sept. 3 New York Times article, Joel Wiener of the real estate Pinnacle Group owned 267 apartments. He now owns 21,642 in 420 buildings.

Most of these apartments are in Harlem, Washington Heights and the South Bronx—some of the city’s poorest neighborhoods. Neighborhood activists accuse Pinnacle of attempting to drive out poor residents in order to drive up rents.

Since January 2004, Housing Court records indicate Pinnacle Group has filed more than 5,000 eviction proceedings, an average of one for every four of its tenants. The rents in vacated apartments then shot up two or three times.

Wiener’s goal, like many landlords’, is to attract new higher-paying tenants at the cost of displacing poor and working people. “I don’t want to call it gentrification,” Wiener told the Times. “I want to call it meeting community needs.”

Pinnacle Group is also charged with violating city rent stabilization laws by raising rents higher than is legally allowed. Although state law allows city landlords to increase the rent after renovating vacant apartments, Pinnacle rent increases were often on the basis of false or exaggerated repairs.


In response to thousands of tenant complaints, the Manhattan district attorney and the state attorney general’s offices have started a criminal investigation of Pinnacle.

A few weeks after the district attorney subpoenaed Pinnacle documents, the company voluntarily withdrew two applications for rent increases it had filed with the state’s Department of Housing and Community Renewal. The DHCR must approve rent increases based on buildingwide improvements.

The withdrawal of its applications suggests fraud, according to DHCR spokesman Peter Moses, who said, “It’s unusual for a company to voluntarily withdraw an […] application.”

Pinnacle purchases rundown property, makes a few questionable improvements, manipulates code violations left behind by previous slumlords and then passes on the cost to tenants in the form of higher rents. Repairs in existing tenants’ apartments, however, are delayed for months.

One woman complained of a water leak that was causing damage to her bedroom wall. Instead of fixing the leak, Pinnacle paid workers to have the damaged wall covered up with sheetrock. Eventually the wall in her bedroom collapsed.

Many tenants have withheld rent as a means to compel Pinnacle to make repairs in their apartments, only to find eviction notices slipped under their doors at night due to non-payment. Other longtime tenants are finding that Pinnacle is making legal challenges to their occupancy and refusing to extend leases.

Refusing to provide maintenance is a tactic used by many landlords in order to frustrate tenants and get them to voluntarily move. This way Pinnacle avoids any legal implications or a possible battle in Housing Court.

One tenant discovered he was being charged for the installation of five toilets in his two-bathroom apartment. Another couple took Pinnacle to court when they realized they were paying for items that were never installed in their apartment.

When questioned about Pinnacle’s business practices, Kenneth Fisher, the company’s attorney, claimed they were all “honest mistakes.” “Any large organization is going to have a certain error rate,” declared Fisher.

In response, many tenants have come together to form Buyers and Renters United to Save Harlem, a group that objects to the gentrification of their neighborhood and other working-class communities in the city.

It is uncertain how many tenants have been forced out of their homes. The average worker cannot afford to challenge Pinnacle in court.

Unlike Donald Trump, Pinnacle does not flaunt its wealth. Its only listed address is an office in midtown Manhattan. Wiener refuses to have his photo taken—for fear of death threats, he claims.

The only telltale sign of Pinnacle properties is the massive U.S. flag that is hung from each property.

It does not have to be this way

In socialist countries like Cuba and North Korea, housing is a right, provided for all people.

Within months of the Cuban revolution, rents on housing were lowered and the National Institute of Savings and Housing was established to create urban housing. And in North Korea, in spite of suffering from U.S. sanctions, housing remains free.

New York City is the richest city in the richest country in the world, yet 33,000 men, women and children find themselves sleeping in the street every night.

It is time we replace this profit-driven society with one that would never allow greed to take precedence over meeting the housing needs of its people.