As you can see from these photos, the hotel management (presently led by vice president David Elder, general manager Andrew Tilley and manager Arnold Tamasar) has obtained permits from the Department of Buildings (DOB) allowing them to begin construction on the Chelsea Hotel. (The permits allow them to renovate kitchens and bathrooms on two rooms on the second floor, and can be viewed on the DOB web site.) For about the past year the hotel had been under a Stop Work Order from the DOB due to management’s failure to meet the conditions necessary to obtain these permits, foremost among them the requirement that they obtain a Certificate of Non-Harassment (CONH) from the Department of Housing Preservation and Development (HPD). (The CONH is required in order to guarantee that a landlord is not attempting to pressure tenants into abandoning their rent stabilized apartments.)
As you might imagine, given management’s ongoing efforts to evict tenants, as well as their failure to make necessary repairs to tenants’ rooms (considered a form of harassment), and to properly register the rooms as rent stabilized with the Department of Housing and Community Renewal (DHCR), it’s going to be difficult for them to legitimately acquire a Certificate of Non-Harassment. But not to worry: the hotel management simply falsified the building permit applications. In a “PW1: Plan/Work Application” for the construction in the two rooms, whoever filled out the form falsely states that the Chelsea hotel is not a “Single Room Occupancy (SRO) Multiple Dwelling,” though in fact it is. (Item 9C) (It doesn’t have to be exclusively an SRO, just a multiple dwelling with some SRO units.) This is significant because any construction in an SRO requires a CONH from the HPD. (As of this writing, HPD does not have one on file for the Chelsea Hotel.) Further, when asked if the Chelsea “. . .contains occupied housing subject to rent control or rent stabilization. . .” the respondent falsely claimed that it did not. (To answer truthfully on the question of rent stabilization would have brought the hotel under the purview of the DHCR, and, as noted, the management refuses to properly register the rooms at the hotel; in addition, dozens of Chelsea Hotel residents have outstanding suits pending at the DHCR.)
Falsifying this application, while a misdemeanor, could involve fines or jail time, or both, and a lawyer I consulted said that such falsification could constitute a felony if done willfully. Though there is a place for Marlene Krauss, as president of the company, to affix her signature, she has neglected to do so—perhaps significantly. Though this blog has accused Marlene of many things in the past year-and-a-half, stupidity has not yet been among them.
One of the reasons that David Elder and Marlene fired the previous management company, BD Hotels, was that BD had failed to get a Certificate of Non-Harassment! As Elder states in a sworn affidavit (Page 2, item 3) in the hotel’s arbitration proceedings with BD:
. . . a Certificate of Non-Harassment must be secured from the City of New York before the renovation project can be launched, and BD NY has already made it clear that it intends to disqualify Chelsea from securing that certificate by refusing to remedy the violations that have been identified by city inspectors. . . .
Elder goes on in the affidavit to claim that BD’s failure to get the CONH could, by delaying construction, cost the hotel up to $20 million dollars in lost revenue! (Elder’s point is that, if the hotel files for a CONH, and is ruled ineligible, they will have to wait 3 years to reapply, losing the revenue they would have made from renting the newly renovated rooms. Further, no bank is going to give them a loan to do the construction if they don’t have the CONH.) And here he is signing a DOB application without the CONH, and actually allowing construction to begin! Most likely, this false filing will complicate the hotel’s legitimate attempts to get a Certificate of Non-Harassment, delaying legal construction further. In any event, this seems to add up to one conclusion: Elder’s incompetence.
Marlene and Elder fired BD for failing to get a CONH, and most likely they will sue BD if they feel they have lost revenue due to this failure. Obviously, there must be considerable pressure on general manager Andrew Tilley and manager Arnold Tamasar to obtain this elusive document. BD, for all its failings, was apparently attempting to do things by the book. Have Tamasar and Tilley just decided to forgo the Certificate of Non-Harassment and begin construction anyway—and see how long it takes the City to catch on? -- Ed Hamilton