Port Morris Tenant Seeks Bronx's First Loft Law Coverage

By Patrick Wall on February 21, 2013 11:06am 

PORT MORRIS — For two blissful years, Edward Jahn and a roommate paid a combined $1,850 per month for more than 1,600 square-feet of brick-walled, wood-beamed loft space, complete with six windows overlooking the Harlem River and off-street parking.

True, the loft was an illegal conversion inside 2407 Third Ave., an old industrial building in the shadow of the Third Avenue Bridge, but Jahn said several of his artist neighbors had long lived in their units incident-free.

But then, last year, this renter’s paradise collided with reality.

After a dispute over a rent increase, the landlord told Jahn he would not renew his lease. Suddenly, Jahn realized that his commercial lease offered him few of the protections granted to residential tenants.

His one hope, he decided, was to apply for coverage under the Loft Law, a state statute that legally converts lived-in commercial or manufacturing buildings into residential ones. Qualifying lofts gain rent stabilization and must be brought up to code.

Soon after Jahn filed the Loft Law application in August, his landlord, James Giddings, sued him for unpaid rent, which Jahn had decided to withhold on the grounds that a commercial landlord cannot collect residential rent. (Giddings said he never permitted Jahn to live in his loft or knew that he was doing so.)

Not only did Jahn’s neighbors decline to sign onto his Loft Law application, but 10 current tenants submitted affidavits with Giddings’ lawsuit stating that they work but don’t live in their units.

Now, Jahn hopes to convince the court that other tenants do live in the building and that, because of this, it qualifies for the protections of the Loft Law.

If he succeeds, experts believe this will be the first Bronx building to covert under the law, which could spur other illegal loft-dwellers in this and other evolving Bronx neighborhoods to follow suit.

“This is the first sign of a neighborhood rising up,” said Jahn, 38. “This isn’t the Wild West anymore. We want to live in a place with fire safety and rights.”

In the late 1990s, zoning changes allowed for new uses of former manufacturing buildings in Port Morris.

In 1999, Giddings, a real estate investor who also runs a fine-art storage and delivery company, bought the redbrick building at 2407 Third Avenue for $200,000. He also invested in a building across the street, which became the Bruckner Bar and Grill.

Before long, artists and other open-minded renters began to venture down to the gritty waterfront neighborhood and into its empty lofts.

Jahn, an IT specialist and freelance media producer, first moved into the Third Avenue building in 2009 and crashed on the floor of a subletter’s loft. That unit was fully residential, Jahn said, with its own kitchen, bathroom and bedroom.

A month later, he and a friend moved into a similar unit next door, which was outfitted with a shower and large outlets presumably for kitchen appliances, Jahn said.

When he signed the commercial lease, adding the name of a company he ran at the time, Jahn informed the landlord that he intended to live in the loft, he said.

“The conversation could not have been clearer,” Jahn said. “I told them I was going to live here.”

Last June, after Jahn had lived in the space for about two-and-a-half years, Giddings’ office manager notified Jahn that a prior rent discount had expired. He now owed $2,200 per month, plus the balance from previous months when the discount did not apply.

Jahn contested the increase until, in July, Giddings sent him a curt email.

“I don’t wish to renew the lease with a tenant who requires this much time and attention,” it read in part. “I don’t want to argue about it, and I want the unit back at the end of the lease period.”

The next month, Jahn applied for Loft Law coverage.

The original 1982 statute, which focused mainly on illegal lofts in Lower Manhattan, was expanded in 2010 to include more recently inhabited buildings.

To qualify now, tenants must have been living in at least three units in a commercial building for 12 consecutive months in 2008 or 2009.

While Jahn’s Loft Law application and Giddings’ unpaid rent lawsuit are being considered by different courts, both hinge on the same question — whether people live at 2407 Third Avenue.

Of the 10 current tenants who signed affidavits claiming not to live in the building, only one responded to phone or email messages.

Larry Kleiman, president of Spectral Masters Inc., a graphics and printing company in the building, said he only uses his loft for work and that he assumes other tenants do the same.

“This is a commercial building,” he said. “I don’t know who does what. To the best of my knowledge, everyone has a commercial lease.”

Giddings declined an interview request.

His office manager, Rosa Garcia, stated in an affidavit that the landlord has a strict commercial-use-only rule for tenants and that Jahn never informed her or the landlord of his residential plans.

Jahn’s former roommate and business partner, Max Horbar, said in an affidavit that the loft was a “raw” space with no kitchen or bedrooms before they arrived and renovated it behind the landlord’s back.

“The unit was not set up for living,” Horbar stated, “and the landlord had no knowledge we would live there.”

But Jahn and two people who filed affidavits on his behalf paint an entirely different portrait of the building.

Luis Rosado, a Port Morris artist, stated in his affidavit that Giddings initially tried to keep the lofts commercial-only, but over time he allowed several artists to renovate and move into their studios.

Rosado said he often visited friends who lived in the building and even stayed overnight “a couple of times.”

Alex Abeles, the co-owner of the Bruckner Bar and Grill who is involved in a separate legal dispute with Giddings, named other people who claimed in the affidavits to be commercial-only tenants, but who he observed living in their units.

With the help of his attorney, Jahn has produced phone directories and voting registrations that they say show several tenants used their lofts as a home address.

One person who lives near the building said it is commonly perceived by locals as both a workplace and home.

“The neighborhood is very aware that there are live-work lofts there,” said the person, who asked not to be named.

Jahn and his supporters suggest that the tenants who they say live in the building could have been pressured by the landlord to sign the affidavits — which Giddings denied in court — or may not want to jeopardize their live-work arrangement.

“There’s an unwritten agreement between everybody to keep it on the down-low,” said Philip Shearer, Jahn’s current roommate.

The rent case is pending in the commercial part of the Bronx housing court. Jahn’s lawyer has asked for a stay of that case while a separate administrative judge considers the Loft Law application.

Meanwhile, Jahn began in December depositing his monthly rent into Giddings’ lawyer’s escrow account. He has already paid about $10,000 in legal fees, he said.

Should Jahn win Loft Law coverage, other tenants living in illegal Bronx conversions may be inspired to apply for the same protections, said Gordon Woodhull, founder of the advocacy group, New York City Loft Tenants.

“If [Jahn] prevails in this, I think a lot of other people will want to get in on this,” he said. “Right now, they really have no rights at all.”

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