Rent Stabilization
55% of New York City's rental housing is regulated--1.2 million apartments with 2.8 million tenants. Rent stabilization limits rent increases to percentages mandated each year by the city's Rent Guidelines Board, and provides some additional protections for tenants. These rules can be circumvented through loopholes including vacancy decontrol. A beleaguered rent-stabilized portfolio is an attractive investment, then, if the landlord can get tenants out of their apartments fast enough to convert them to market-rate rental units.
Rent stabilization will expire on June 15, 2019 if the laws are not renewed.
An Attractive Investment

The difference between the depressed, stabilized rents and the market-rate rents is often dramatic.
The strategy to buy rent-stabilized apartments means that they sometimes may use illegal and frequently unethical means to get tenants out of the stabilized apartments, since one of the only ways to destabilize an apartment is when there is a vacancy.
The East Harlem Portfolio
If every building in East Harlem were a square, 49 of those squares are owned by Emerald Equity.
source: nyc-db
Where does Emerald Equity fit in?

The complaints made by tenants from Emerald Equity's buildings are just a small picture of tenant discontent in East Harlem.
But Emerald Equity only has 49 buildings out of a total 3078 in East Harlem. Those buildings contain 1449 apartments out of the 51170 apartments in all of East Harlem.
source: nyc-db
It's bad in East Harlem...
but for Emerald Equity tenants, it's worse than ever.

This is how many complaints per thousand units Emerald Equity has, compared to the per-unit rate in all of East Harlem. source: nyc-db
HPD Class A Violations
Housing Preservation and Development violation classes are confusing: Class A is the least serious, and Class C is the most serious.
Examples of Class A Violations:
-No peephole in the entrance door of the dwelling unit; -No street number on the front of the dwelling source: Housing Preservation and Development
HPD Class B Violations
Class B violations are more hazardous than A, less hazardous than C. Examples of Class B Violations:
-Inadequate lighting facilities for public halls or stairs; -Owner has not provided an approved smoke detector in dwelling unit; -Unlawful bars or gates on windows opening to fire escapes source: Housing Preservation and Development
HPD Class C Violations
Class C violations are immediately hazardous.
Examples of Class C Violations:
Inadequate supply of heat and hot water; Rodents; Peeling lead paint in dwellings where a child under 7 resides; Broken or defective plumbing fixtures; source: Housing Preservation and Development
Total HPD Litigations
Housing Preservation and Development (HPD) initiates actions against landlords of privately-owned buildings to enforce legal standards of maintenance and repair.
While the buildings Emerald Equity owns are just a small part of the total HPD litigations in East Harlem...

Average HPD Litigations
Lawsuits in the Emerald Equity portfolio are much more frequent than in the rest of East Harlem.
The buildings have seen 74 new lawsuits initiated since Emerald Equity acquired the buildings: 17 are still pending.

DOB Complaints Total
Department of Buildings complaints are complaints that are issued by city inspectors. They are generally more serious in nature.
And while Emerald Equity is only a small fraction of the total Department of Buildings complaints in East Harlem...

Department of Buildings Complaints

They are overrepresented by average. For every thousand units, Emerald Equity units have many more complaints than the East Harlem average. This has been true historically, as the data shows, but has worsened dramatically since the portfolio was purchased by Emerald Equity.
Categories of HPD Violations

Lead, Mold, Gas.
Lead is shown in red.
The uptick in gas and lead complaints are often related with new construction in recently vacated apartments.
Hastily done construction means lots of dust, filled with lead from decades of paint, and damage to gas lines.