New Hope for Notorious Hell’s Kitchen Tenements as Nonprofit Takes Over
July 2, 2024
W42ST
Dashiell Allen
Four Hell’s Kitchen tenements previously owned by one of the most notorious landlords in New York City, Steve Croman, are on their way to being fully remodeled by a nonprofit. However, major construction work still remains.
A bathtub in the kitchen is a common feature of old Hell’s Kitchen tenements. Photo: Molly Stromoski for NYC Department of Housing Preservation and Development.
The buildings (351-357 W45th St bw 8/9th Ave) were among the worst that Arlo Chase, senior vice president of real estate at Services for the UnderServed (S:US) had ever seen when his nonprofit bought them for $20 million in June.
“A lot of the doors were off the hinges, bricks were loose, there were mice, vermin, rats,” Chase told W42ST as we chatted on the sidewalk outside the apartments.
Some of the buildings, including 353 W45th Street, were difficult to enter due to the build up of pigeons and pigeon excrement, he recalled. The walls were covered in mold and a squatter lived on the first floor.
Arlo Chase, senior vice president of real estate for Service for the UnderServed. Photo: Dashiell Allen.
Community leaders and tenants have complained for years about dangerous conditions at the buildings, holding protests and demanding city agencies take action while the properties racked up hundreds of Department of Housing Preservation and Development (HPD) violations.
During Croman’s ownership of the buildings, HPD entered 24 litigation cases against him, including six for not providing heat and hot water. Croman also accrued over $50,000 in charges from the City Department of Finance, and city agencies spent $46,000 on emergency repairs after he failed to do so.
Of the 80 formerly rent-stabilized units, just 10 remain occupied. According to Chase, Croman’s “whole business strategy was to get rid of all the tenants so he could convert [the properties] to market rate.”
“It was a combination of neglect and active deterioration,” he said.
Images taken during an HPD walkthrough after S:US purchased the buildings. Photos: Molly Stromoski for NYC Department of Housing Preservation and Development.
In the past six months, conditions have greatly improved. On the day S:US acquired the buildings, they entered with a team of 50 people, secured doors and windows, and installed security cameras and an in-person security guard — who Chase said is no longer needed.
S:US acquired the buildings through a loan from HPD, and is working on the upgrades in collaboration with Highpoint Property Group and SMJ Development.
The developers performed emergency repairs for some of the 10 tenants, including replacing fridges and stoves and fixing heaters.
Condition of the buildings immediately after purchasing from Croman. Photo: Kevin Zhao/Highpoint.
They plan to replace the roofs and several structural beams, which are in need of support. “The roof should have been replaced five to 10 years ago,” said Chase.
Heating systems and appliances will also be electrified, with new ventilation systems. The bill for the work is estimated at $52 million, including $18 million for construction and $14 million for “soft costs,” including possibly relocating tenants, and paying consultants and attorneys.
Chase estimates that work could be completed by the summer of 2026. S:US plans to close on its construction funding in January or February, after which work will take an estimated 14 to 18 months.
Condition of the buildings immediately after purchasing from Croman. Photo: Kevin Zhao/Highpoint.
When completed, the 70 unoccupied units in the buildings will be reserved for homeless families with City FHEPS vouchers, who pay 30% of their income on rent through a rental assistance program administered by the Department of Social Services.
The current tenants will be allowed to stay. “Some of the tenants have not wanted to engage with us for whatever reason,” said Chase. “But for the ones that we’re actively working with, the conditions are much better, and we’ve offered to relocate all of them during the construction period.”
S:US will combine the space underneath the four buildings to create offices and an exercise room. They plan to provide wellness and employment coaches and a family life specialist on-site.
The buildings at 351-357 W45th Street were officially purchased by S:US in June for $20 million. Photo: Kevin Zhao/Highpoint.
This is a new type of project for S:US, a nonprofit dedicated to helping people with disabilities living in shelters find permanent housing that controls over 100 buildings. In most cases they develop new buildings from the ground up, rather than acquiring them.
S:US’ CityFHEPS contract is for 10 years, and the nonprofit signed a 40-year regulatory agreement with HPD to preserve the four buildings as affordable housing.
A spokesperson for HPD told W42ST in a statement, “Our job at HPD is to serve and protect New Yorkers by creating safe, livable homes and that’s exactly what we’re doing at 351-357 West 45th Street. The residents in these buildings deserve better, so we’re hustling to turn these long-neglected buildings into much-needed affordable housing for New Yorkers, including homeless families, who will finally have a stable and safe place to call home.”
“We’re signed up for the long term,” Chase said. “S:US is a mission-based organization, so we have no intention of doing otherwise.”