Entries in the Category "Hoboken, NJ"

Hoboken: Archstone Hudson Park - Outrageous Rent Increases

I am going to mention this since one of my good co-workers lives there, and the actions by management are quite reprehensible.

The Hudson Park condo known as 77 Park in Hoboken was recently completed in 2000 and holds approximately 300 rental units, 450 parking spots (public/private). It is located near the Hoboken PATH station, about 2-3 blocks away, and is along the Observer Highway and railroad tracks leading to Hoboken Terminal.

A little over 2 years ago, it was taken over by Archstone Properties. (See notice indicating the takeover). It was originally run by The Pegasus Group.

Recently, some residents of Hudson Park were starting to get their next projected rent increase for next year. While a few were receiving increases of about 7 percent, others were notified of rent increases of 24 percent to 35 percent!

As stated on hoboken411.com, one tenant was offered a 8-month lease with a rent increase of 7%. At the end of that lease, he was offered another 8-month lease with another increase of 7%. So this was a 14% increase in a 16-month period. Another tenant's lease was raised from $1800 to $2800. He refused the new price. Another one had $2100 going up to $2900 (35%), and one had $2500 to $3100 (24%).

Because of these exorbitant and unfair increases, a group of residents passed out a flyer and wanted to get together in the gym to voice their concerns and sound out some ideas on how to address the price increase.

Well, it seems that the building management found out about the meeting and released a "Courtesy Update" to all residents on the 21st of November. (The same day where the tenant meeting about the rent increase was supposed to ake place.)

The eventual tenant meeting was held off-site.

The notice regarded the flyer by the "Concerned Tenants" as unapproved by management and was not given permission to be distributed to apartment residents. It also noted that the gym was not an "appropriate" meeting place to hold a discussion, and that the lobby should have been used instead, but further stated that permission was still needed nevertheless.

It claimed that some residents were offended by the "surreptitious" nature of the delivery of the flyer. (Cheapshot excuse.)

The management's reasoning on the huge rent increases:

1. Claimed that "extensive" market surveys showed apt rates increasing significantly in the greater New York area

2. Argued that the prior owner (Pegasus Group) did not raise rents in response to changing market conditions

3. Believed that rental rates "slipped" well below the value of apt housing at Hudson Park condo

4. Believed that residents were enjoying this "temporary pricing benefit" as a courtesy by current management

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A snapshot of Archstone's rates for the property:

archstone-rates.jpg

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It is true that condo property located in Hoboken have appreciated in value because of its proximity to New York City, and more luxury rentals and condos are still being built in the area. Of course, the Hudson Park condo is not registered under the Hoboken rent control ordinance.

The rent control law currently being applied to the older multi-family properties limits rent increases to the CPI or 7.5 percent max each year. If a tenant vacates, the rent can be raised up to 25 percent for the new tenant. Yet, this condo and newer properties being built are not applicable (an agreeemnt with the Hoboken town council?).

While a few can argue that this huge rent increase is not surprising, the issue is that rents usually stay in line with wages and inflation. How can raising your rent by 55 percent be considered reasonable? If inflation goes up 2-3 percent, and your salary raise goes up 5-6 percent, this would mean you would be hard pressed to support your current living arrangements.

Even some residents argue that the "luxury" condo is not really that great. No significant improvements have been made to the building. There were past incidents of water pressure loss and a mice infestation.

Obviously, the management really wants to squeeze as much as money as possible out of the renters. It is true that residents can take their business elsewhere, but does this mean we should surrender without a fight? It is true people can advertise the fact that the management operating Hudson Park are liars and are willing to charge expensive rental leases, but there will always be people willing to afford those prices. Yet, Hoboken is not New York City. It is not Chelsea, Soho, or the Upper East/West Side.

It would seem that everyone is sympathetic to the Hudson Park residents. Action should clearly be taken since the management is attempting to "suppress" the residents' efforts to join together. It is using the "safety policy" to prevent any meeting to be held in the gym, and while it has suggested the lobby as an alternative meeting place, it seems that management has placed one of their staff members in the lobby to keep "an eye on things."

It is true that renters do not have property rights. But is a rent increase of 30-60% conscionable and reasonable?

Update 12/04/06

The tenants are getting together tonight again to address the rent issues. I wonder if management will try to get someone from their side to attend. It would be miraculous if a management person shows up and actually listens to the complaints and criticism of their rent increases. Perhaps a "tar and feather" would be an enjoyable conclusion to the meeting.

It would also appear that Archstone is implementing their higher-than-normal rent increases at other properties. Washington Post has a piece on the Archstone Newport Village located in Alexandria, VA. The article noted that after the original owner, Charles E. Smith Residential Realty, merged with Archstone back in 2001, there were more frequent rent increases, and certain amenities were now charged separately from the rent bill.

"We were finding that many of our customers were looking for short-term leases, and Archstone decided to test whether customers should receive price breaks for those leases," explained Jessica Janez, Newport Village's assistant manager.

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If you take a look at the opinions of Archstone properties across the country, you may find similar complaints about their fee structure, unreasonable excuses why your rent has to go up 35%, and poor quality of management of the property. Likewise for property that were taken over by Archstone. It would seem they are pursuing a relationship where they will clean you out of whatever cash you may have for their high rent price and other so-called "administrative" fees. They are more interested in high turnover than retention.

Update 12/12/2006

Here's a link to rentometer on the 77 Park property. An average rent of $2,900 per month at this property places it higher than the other nearby rental properties in Hoboken.

Also, the Hoboken Reporter has an article on it.