Report: Steve Croman earned $23 million from his East Village properties in 2014

On Monday, news broke that landlord Steve Croman of 9300 Realty was hit with a 20-count indictment on charges including grand larceny and filing false documents ... as well as a civil suit.

Croman, who reportedly owns more property in the East Village than any other landlord, faces up to 25 years in prison.

In a story posted yesterday, The Real Deal dug into public records to figure out Croman's revenue and expenses from his 145 buildings, which was used to estimate his net income.

According to The Real Deal's research, Croman owns 47 buildings in the East Village with 617 units. His gross income just from the East Village properties was estimated at a little more than $23 million. (In total, he took in some $63 million in 2014, per TRD.)

Here's an excerpt from TRD:

At six of his properties — 380-382 East 10th Street, 145 East 26th Street, 44 Avenue B, 20 Prince Street, 199 East 3rd Street and 325 East 5th Street — Croman was charged with changing the rent rolls in an effort to make the property’s income appear higher than it was. In one instance in 2012, Croman reported that all 20 units at 380-382 East 10th Street were market-rate, according to Department of Finance records reviewed by TRD. However, all 20 units were listed as rent-stabilized in the prior year, and 10 were marked as rent-stabilized in 2013. At present, three of the apartments are listed as rent-stabilized.

According to Attorney General Eric Schneiderman’s lawsuit, Croman allegedly would walk through his office chanting "buyouts buyouts," and staffers received sizable bonuses for every successful buyout.

The moment when a dog urinated on Donald Trump's portrait outside Tompkins Square Park

If you were around Seventh Street and Avenue A outside Tompkins Square Park earlier today, then you likely saw the large portraits of presidential candidates Donald Trump and Hillary Clinton.

Yonkers-based artist Jeffrey Reid has shown his work here in the past. (Like here and here.)

Anyway, EVG reader John Iz happened to be here at the moment a dog endorsed the Trump portrait...

[Updating] Danger of falling bricks on 9th Street and 3rd Avenue

[Photo by Steven]

In case you wandered what all the helicopters were doing circling...

According to NBC 4, someone noticed a 10-by-10 foot section of the facade starting to separate from the building on the 15th floor at the St. Mark, 115 E. Ninth St. at Third Avenue.

We'll update when more info comes through...

6:09 p.m.

Yikes... you can see where the problem is...here between East Ninth Street and East 10th Street...


[Photo by Steven]

6:31 p.m.

There are at least six firetrucks on the scene... and several small rescue vehicles. There isn't any word of injuries. And there are conflicting reports if any bricks actually fell to the sidewalk bridge below...







Thanks to Steven for the photos...

Updated 9:33 p.m.

Crews are on the scene shoring up the facade this evening...





Photos via EVG reader Christopher

Updated 10:30 p.m.

A resident of the building shared this "this poem/rant/list of questions" that someone put in the elevator tonight. "Tenants are pissed too," the resident told us.



Here's part of an updated report from CBS 2:

Initially, there were reports that bricks fell from the building, but the FDNY later said that was not the case.

There was no immediate threat to public because there was already a sidewalk shed in place, the FDNY said. Only three apartments were evacuated.

Late Wednesday, Third Avenue remained closed between 9th and 10th streets. It was not known when the street would reopen.

5/12

As of around 7 a.m.





Third Avenue remains closed between Ninth Street and 10th Street ... and East Ninth Street between Third Avenue and Fourth Avenue is also shut down.

Per ABC 7:

Firefighters have built a temporary wooden brace to keep bricks from falling from the 14th through 16th floors. The New York City Fire Department will remain on the scene with one engine until the facade is inspected by the engineer.

A boom truck is being used for more permanent repairs.

The building has 17 open Buildings Department violations, including one for facade safety. There is also an ongoing violation for failure to certify correction of a prior violation, which will require payment of a penalty to DOB.

On the ground level, workers have been tearing down the walls and gutting the former P&P Convenience Store, East Village Cheese (now on Seventh Street!) and Excel Art and Framing Store (now on the other side of Third Avenue!)... to help expand the Duane Reade on the East 10th Street corner.

Updated 1:30 p.m.

The streets around the building remain closed...



... and from the look of the photo via Steven... it appears just one worker is on the job now. Perhaps there are others inside...



Updated 2:30 p.m.

OK, there are several workers in the hanging scaffolding... as these photos via EVG reader Robert F. show...



...and the scene around the zone... Most of the storefronts between Ninth Street and 10th Street are vacant...





Previously on EV Grieve:
Rumors: Duane Reade expansion will take over adjacent storefronts, including East Village Cheese (74 comments)

East Village Cheese makes move to 7th Street official

The New Museum is expanding on the Bowery

The New Museum will nearly double its size on the Bowery.

Here are some details via the EVG inbox...

The New Museum is launching an $80 million capital campaign to mark both the Museum’s fortieth anniversary and its tenth year on the Bowery. The campaign, which will support expansion and growth of Museum programs and more than double the endowment, has already received $43 million in lead gifts from several members of the Board of Trustees.

After nearly a decade on the Bowery, during which visitation has grown by 400 percent and the number of people served by its programs has grown 4,000 percent, the New Museum is bursting at the seams. Renovating its adjacent property at 231 Bowery will provide additional space for programs while adding urgently needed office and support spaces. The expansion effort will ultimately enable the Museum to double its exhibition galleries, expand educational initiatives, improve circulation, add more public amenities, and improve the visitor experience.

231 Bowery was home to Daroma Restaurant Equipment until the spring of 2011 when they moved down the Bowery (and the owner pleaded guilty to tax fraud). The New Museum bought the building for $16.6 million in September 2008.

According to The New York Times, the address once provided "raw studio space for seminal New York artists like James Rosenquist and Tom Wesselmann."

The combined 231 and 235 "would increase the museum’s footprint for exhibition space, storage and offices to a little more than 100,000 square feet, from 58,000 square feet now," per the Times.

Photo courtesy the New Museum. Dean Kaufman, 2015

Out and About in the East Village

In this weekly feature, East Village-based photographer James Maher provides us with a quick snapshot of someone who lives and/or works in the East Village.



By James Maher

Name: John Ellert and Sam
Occupation: Retired, director of nonprofit, Vietnam veteran.
Location: Tompkins Square Park
Time: 1:30 p.m. on Monday, May 9

I was born in Far Rockaway, Queens. I’m from the south shore. I started coming around here with the influx of the counter-culture influence in the mid-60s. I was hanging out down here when I got drafted and went to Vietnam. Actually my last night in New York, I spent over on St. Mark's Place at the Electric Circus – it was either the Electric Circus or the Balloon Farm.

I lived around here in the 1970s and 1980s. In the 1960s, there was a mixture of people that were living here. A, B, and C – it was nothing like it is now. There were a lot of kids. There was a lot of flops, and hippie kind of culture, and there was also a Latino culture, very very strong, from the neighborhood. Sometimes [the groups] butted heads.

In the 1970s, with the influx of hard drugs it became very different. This was a very hard neighborhood. If you moved in here in the early 1970s and got a place on Avenue A or Avenue D, you might have some kid using a carjack to bring up your window guards, to keep people out. The smallest kid would come in — they might clean you out while you stepped out to go to the store. It was a tough place to live.

Then in the 1980s, I lived over on the Bowery. There were a lot of flops. There were places like the Whitehouse, the Sunshine, different places. I lived across the street from CBGBs. I’ve also been homeless down here, and now I have a co-op down here.

I’m a street guy, a blue-collar guy. I went back to school kind of late in life. I went to graduate school and then I became the director of a program in Lower Manhattan. They worked with homeless people and helping people to get back to work. I left there a couple years ago.

I was living on 73rd Street and I would come downtown once in awhile to do stuff when I wasn’t working in SoHo, but I’d come right around here and the feeling would change immediately. I said, ‘I gotta get back here.’ Just cruising around and going into different stores and noticing the restaurants and the people that I would meet. Then I got this co-op. It’s my favorite neighborhood in the world. There’s diversity, and kind of just the spirit of acceptance of all kinds of lifestyle that you don’t feel everywhere. You hear it spoken but… you know there’s music in the air down here.

I constantly question myself, you know, or the people that walk by. I just did it — a guy asked me for change, and I was listening to one of my favorite old songs and I didn’t really… I said no. But ordinarily, what’s a little change, and he deserves some acknowledgement. It’s a neighborhood that if you’re going to be part of it, be part of it. Don’t be part of some of it. Say hi to people. Acknowledge their existence. Although none of us are perfect and we don’t always do it, I think it’s important to keep questioning ourselves. I always question myself, if I’m being part of what this is about down here, or what is should be about.

I’ve been a drug addict and an alcoholic. I mean, that’s how I ended up homeless on different occasions. I’ve gone through a lot of things. I remember getting sober in 1990 and coming down here and watching punk kids drawing up needles out of the water fountains on a Sunday afternoon when people had their kids here. This was strange even for me. Even I used to hide somewhere.

What do we want this to be? New York has been deprived of its neighborhoods. Everything keeps changing and this is going to change, and what do we want it to be? It’s up to each one of us individually.

James Maher is a fine art and studio photographer based in the East Village. Find his website here.

Branded sidewalk bridge arrives at 347 Bowery along with prices for the million-dollar condos

There are finally more details to note about 347 Bowery, the 13-story, 30,000 square-foot mixed-use residential development rising at East Third Street.

All we heard before was that the project will feature five 3-bedroom homes ranging from 2,100 to 4,000 square feet, two 2,000-square-foot commercial units and one 6,800-square-foot retail unit.

First! The 347 Bowery branding went up on the sidewalk bridge over the weekend...





Meanwhile, Curbed reported yesterday that units at the former home of the Salvation Army's East Village Residence will start at $6.5 million. (Curbed has some interior renderings too.)

Here's more:

[C]eilings in the living areas will reach nearly 20 feet, and each apartment will have a handcrafted staircase of plaster and white oak. On the upper floors, the master bedroom will be separated from secondary bedrooms by way of a catwalk. All condos in the building will have a terrace.

And per the marketing materials: "The building's transformation, from a former Salvation Army shelter to an upscale condo, is a testament to the neighborhood's changing demographics."



Sales are expected to start later this month.

Previously on EV Grieve:
The Salvation Army's former East Village Residence will be demolished on the Bowery

Whatever happened to that really ugly hotel planned for the Bowery?

Looks like 347 Bowery will be home to a 13-floor mixed-use residential development

The future of 347 Bowery (sorta!) revealed

Let's take a look at 347 Bowery, now and in the future

Reaching the top at 347 Bowery

[EVG file photo]

If you're Jonesing to buy a new apartment building on East Houston

[Image via Cushman & Wakefield]

Jones LES is one of the newer residential complexes in the neighborhood, with rentals hitting the market back in December.

If you REALLY like the 13-story building at 331 E. Houston at Ridge Street, then maybe you can buy it. The place is for sale.

The listing arrived yesterday at Cushman & Wakefield:

The 13-story, 78-unit building features a hotel-style lobby attended 24-hours a day, library, fitness center, private garden, and landscaped roof deck. The unit mix consists of 24 studios, 40 1-bedrooms, 13 two-bedrooms, and a single three-bedroom unit featuring a balcony on the 13th floor. All residences feature oversized casement style windows with solar shades, oak flooring, custom Italian satin cabinetry, Ceasarstone countertops, stainless steel appliances, modern designed bathrooms, and washers and dryers. Of the 78 units, 62 can be rented at market rates and 16 are designated affordable. The property is located within short walking distance of the F train stop and East River Park. There is future upside as a potential condo conversion in an area that will be bolstered by Essex Crossing, a 1.9 million square foot development located only three blocks south.

No word on the asking price for the building. The rentals for the four active units on Streeteasy range in price from $3,900 (one bedroom) to $9,400 (three bedrooms).

Previously on EV Grieve:
An L-Shaped footprint ready to make its impression on East Houston Street

An abandoned car in an empty lot that will soon yield a 13-floor residential building

On East Houston, work begins on a new 13-floor residential building

What 331 E. Houston St. will look like one day

A look at 331 E. Houston St., with a rooftop deck for outdoor showers and 'Live Free or Die Hard'

16 affordable apartments now available at the incoming 331 E. Houston St.

Full reveal at 331 E. Houston St.

331 E. Houston St. now with a teaser site and name — Jones LES

If you're Jonesing for a new apartment on East Houston

[Updated] Nail salon coming to the former Twist space on Avenue A

The signage is up at 70 Avenue A for Appolodine, a nail salon in the works for the empty storefront between Fourth Street and Fifth Street.

The website listed on the signage isn't active just yet, so there's no word on the various services that Appolodine will offer. A reader found the website.

The space was previously home to Twist, a froyo-gelato shop with irregular hours.

H/T to EVG reader JG for the photos and intel!

Noted

The chair tied to a tree guard on East Fourth Street between Second Avenue and the Bowery is marked "private."

Photo by Derek Berg

The new Mamoun's Falafel is now open on St. Mark's Place

The new Mamoun's location opened today at 30 St. Mark's Place ... a larger space a few storefronts away from their previous spot on the block between Second Avenue and Third Avenue.

Previously

Thanks to Vinny & O for the photo.

Tenants and local elected officials speak out against Icon Realty

[Photo by Grant Shaffer]

Tenant groups, community organizations and local elected officials continue to put pressure on landlords behaving badly in the neighborhood.

Yesterday, it was Icon Realty's turn.

Here's part of the news release that the Cooper Square Committee released:

[On Monday], tenants of two Icon Realty-owned East Village buildings, 445 East Ninth Street and 57 Second Avenue, along with local elected officials and community groups, call on Icon Realty to end their alleged campaign of construction-as-harassment against tenants and to meet the tenants’ demands.

If Icon refuses to do so, the tenants – represented by the Urban Justice Center and Manhattan Legal Services – will file lawsuits against the landlord.

For years now, Icon Realty has been aggressively displacing rent-regulated tenants to make room for ultra-high rent paying tenants. Like other bad-acting landlords, Icon Realty has exposed tenants to hazardous health and safety threats, brought dozens of lawsuits against tenants, and continue to deny tenants their right to live in these buildings without fear of extreme tactics to remove them.

“At the end of the day, we don’t know what we’re coming home to. In two years of bad communication, bad accounting, loss of basic services, cycles of neglect and disregard, we are now accustomed to uncertainty where none should exist,” said Ben Coopersmith a member of the 445 E. 9th Street Tenants Association. “We will demand fair play for our tenancies with Icon Realty Management beyond the glad-handing of their representatives, the unfulfilled promises, even the possibility that they will flip us once the paint dries.”

During a rally outside the Icon-owned buildings at 445 E. Ninth St. and Avenue A and later at 57 Second Ave., Icon tenants announced their demands for proper lead mitigation, safe construction practices, unobstructed building entryways ... and for Icon Realty to respect rent-regulated tenants’ rights.

City Council Member Rosie Mendez and State Sen. Brad Hoylman were among the speakers.


[GS]


[GS]


[Photo by Derek Berg]


[DB]


[DB]

Icon Realty bought the building at 445 E. Ninth St. for $10.1 million in April 2014, according to public records. The storefronts are now all vacant. The Upper Rust was the last to leave after a reported rent increase. Icon took over ownership of 57 Second Ave. in early 2015. Both longtime businesses have closed here too.

The Lo-Down has coverage here, including a statement from Icon spokesperson Chris Coffey.


[GS]

Mikey Likes It unveils a new ice cream truck

The truck made its debut yesterday outside the shop on Avenue A between 12th Street and East 13th Street...

Looking good...



By the way, Mikey Likes It turns 2 this May 19.

You can read our two-part interview with Michael "Mikey" Cole here and here.

Thanks to dwg for the photos!

Cellar 58 closed for renovations on 2nd Avenue

Cellar 58, the low-key Italian restaurant on Second Avenue between East Third Street and East Fourth Street, is temporarily closed for renovations.

Signage on the door offers an apology and prompts customers to check in on the restaurant's website for reopening updates...



I've had several nice meals here, and look forward to their return. (And all signs point to an actual closed for renovations, and not a dubious "closed for renovations.")

The return of 'Girls' and the end of the encampment outside Tompkins Square Park

Crews for "Girls" will be filming around parts of the neighborhood today... we spotted the signs along Avenue A and Tompkins Square Park as well as East Houston near Clinton Street. (And probably elsewhere?)

Season five recently concluded on HBO ... and the series will end after season six. So, presumably, this filming is for the last season.

Anyway! Coincidentally (or not), the encampment that had been growing in recent weeks at the entrance to Tompkins Square Park along Seventh Street was cleared out yesterday...

Before (photos via an EVG reader)...





...and yesterday afternoon...

More on the charges against Steve Croman; buyouts were a 'team sport'

Here are more details about the arrest this morning of landlord Steve Croman via the Attorney General's office...

Attorney General Eric T. Schneiderman today announced that Steven Croman, a major New York City landlord with more than 140 apartment buildings across Manhattan, surrendered on multiple felony charges for his role in an alleged scheme to fraudulently obtain several multi-million dollar refinancing loans between 2012 and 2014.

Croman was also named, along with private investigator Anthony Falconite, in a civil suit filed today by the Attorney General’s office for allegedly engaging in illegal, fraudulent, and deceptive conduct in connection with Croman’s real-estate business. The lawsuit alleges that Croman directs an illegal operation that wields harassment, coercion, and fraud to force rent-regulated tenants out of their apartments and convert their apartments into highly profitable market-rate units.

The lawsuit further alleges that Croman deployed Falconite, a former New York City police officer, to frighten and intimidate rent-regulated tenants into surrendering their apartments.

“My message to unscrupulous landlords is simple: if you put your own profits over your tenants’ legal protections, we will investigate you and prosecute you to the fullest extent of the law,” Attorney General Schneiderman said. “My office will not tolerate anyone who attempts to line their own pockets by gaming the system. No one is above the law – no matter how rich or powerful.”

The criminal and civil cases are the result of independent, parallel investigations during the past two years.

Details on Criminal Charges

Based on an extensive investigation by the Attorney General’s office, Croman allegedly submitted false mortgage documents to New York Community Bank and Capital One Bank, including rent rolls that falsely reflected market rate rents for units that were actually occupied by rent-stabilized tenants. Croman also allegedly inflated the amount of rent charged for certain commercial spaces in his buildings in an effort to show greater rental income. Croman allegedly falsified these rent rolls in order to inflate the annual rental income of his buildings, upon which his refinancing terms are partially based.

All told, over a three-year period, Croman allegedly received more than $45 million in loans under these false pretenses.

A grand jury indicted Croman on 20 felony counts, including seven counts of grand larceny in the 1st degree, seven counts of falsifying business records in the 1st degree, one count of scheme to defraud in the 1st degree, four counts of offering a false instrument for filing in the 1st degree, and one count of criminal tax fraud in the 4th degree.

Croman’s mortgage broker, Barry Swartz, also faces 15 felony counts, including seven counts of grand larceny in the 1st degree, seven counts of falsifying business records in the 1st degree, and one count of scheme to defraud in the 1st degree.

If convicted of all counts, Croman and Swartz could face as much as 25 years in prison. The charges against Croman and Swartz are allegations and they are presumed innocent unless and until proven guilty in a court of law.

The Tenant Protection Unit of New York State Homes and Community Renewal provided the Attorney General’s office with a criminal referral that was pivotal to the process.

Details of Civil Lawsuit

The civil lawsuit, filed in New York Supreme Court in Manhattan and the product of an independent investigation, alleges that Croman used the following illegal tactics to push working-class and low-income tenants out of their homes:

• Harassing tenants into surrendering their apartments—and their rights under the rent-stabilization laws—in exchange for “buyouts,” which are often no more than a few thousand dollars or a few months of free rent.

• Incentivizing his employees and agents to obtain buyouts, at the expense of their other responsibilities. Employees allegedly refer to rent-regulated tenants as “targets” and compete with each other to obtain the most buyouts. In one characteristic exchange, Falconite allegedly wrote to a property manager that obtaining buyouts was a “team sport,” to which the property manager responded, “I know that!! Who’s our next target? We have to start lining them up!!!”

• Pressuring tenants into surrendering their apartments by repeatedly filing baseless lawsuits against them. In internal emails, company employees allegedly acknowledged that such lawsuits would “aggravate” tenants or pressure them to accept buyouts. In some cases, Croman’s employees allegedly created a false record for litigation by refusing to acknowledge receipt of tenants’ rent checks and then suing them for unpaid rent—a deliberate fraud upon the court.

The lawsuit also alleges that Falconite, whom Croman allegedly refers to as his “secret weapon,” used deceptive and frightening tactics to intimidate rent-regulated tenants. The lawsuit alleges that Falconite’s text messages with property managers show that he regularly uses false pretenses to gain access to tenants’ apartments, often posing as a repairman or building manager. For example, in text messages to a property manager, Falconite allegedly agreed to use “false pretenses” and pretended he was with the construction department.

The lawsuit alleges that Falconite routinely threatened tenants and improperly accused them of violating their lease. He also allegedly abused his position as a former NYPD officer to threaten and intimidate tenants.

In addition, the lawsuit alleges that Croman, in his rush to flip vacant rent-regulated apartments into high-rent units, presided over a disturbing pattern of illegal and hazardous construction. The lawsuit alleges numerous examples of illegal construction, including the following:

• On at least 175 occasions, Croman’s companies allegedly performed construction without obtaining permits.
Croman allegedly regularly directed his employees to flout stop-work orders and conceal unlawful construction from Department of Building inspectors.

• Croman allegedly filed false documents with the Department of Buildings on dozens of occasions in an attempt to avoid stricter oversight of his construction projects and elude tenant protection measures.

• Croman and his companies allegedly violated lead-safety laws repeatedly, exposing numerous tenants to lead-contaminated dust. On more than 20 occasions, the Department of Health (DOH) found impermissibly high levels of lead dust in Croman’s buildings, including levels up to 65 times the legal threshold.

• Croman allegedly defied DOH orders to address the lead hazards. On one occasion, after DOH order Croman to stop all work and begin lead-abatement measures, Croman directed his property manager to postpone the lead abatement so that the construction could continue.

Read the full release here. As previously noted, Croman owns more buildings in the East Village than any other landlord.

More shade arrives for Cooper Square

Another sign of progress today in the ongoing Astor Place/Cooper Square Reconstruction Project... workers started planting new trees around the plaza area of Cooper Square as the above photo via EVG reader Mona W. shows.

As for when Astor Place's more famous tenant, the Alamo, will return... we now hear late May/early June. Workers packed up and carted off The Alamo for the duration of the reconstruction back on Nov. 25, 2014.

Here's a link to a weekly bulletin (PDF), noting what's happening this week.

The anticipated project completion date is now summer 2016, according to the reconstruction newsletter (PDF here).

Previously on EV Grieve:
The Alamo returns to Astor Place this Halloween

Five years later, Astor Place apparently ready for its 2-year reconstruction project

This is what it might be like living inside the Alamo on Astor Place

RIP Tony Rosenthal, the sculptor who created the Astor Place cube

The Alamo has been away from Astor Place for 1 year now

The all-new Astor Place is coming along (for real)

Other Music is closing for good next month

Ugh.

Via the Other Music website:

It is with heavy hearts that we share the news that after more than 20 years in New York City, Other Music will be closing our doors on Saturday, June 25th. It’s been an incredible run for us, and we cannot thank you enough for the support and inspiration that you’ve given us over these past two decades. We’ve learned so much from you and are so grateful to have had your trust, curiosity, and passion as we’ve discovered and explored so much great music together since we first opened back in December of 1995. Times have changed, and soon we will be moving on, but in the coming weeks we hope you’ll come by and see us, dig through our racks, and reminisce about what has been a truly special era for all of us. We’ll also be announcing more events and celebrations soon, so stay tuned. Once again, thank you, from the bottom of our hearts.

The store's label, Other Music Recording Co. will continue.

Per The New York Times:

“We still do a ton of business — probably more than most stores in the country,” said Josh Madell, 45, a co-owner of Other Music, from behind the counter last week. “It’s just the economics of it actually supporting us — we don’t see a future in it. We’re trying to step back before it becomes a nightmare.”

Business has dropped by half since the store’s peak in 2000, when it did about $3.1 million in sales, said Chris Vanderloo, who founded the shop with Mr. Madell and Jeff Gibson after the three met as employees at the music spinoff of Kim’s Video in the early ’90s. (Mr. Gibson left Other Music’s day-to-day operations in 2001.)

Rent, on the other hand, has more than doubled from the $6,000 a month the store paid in 1995, while its annual share of the building’s property tax bill has also increased with the local real estate market.

The store is located on East Fourth Street between Lafayette and Broadway.