Loftlandia: The South Bronx Is the New Soho

Gov. Andrew Cuomo has signed legislation that extends the state's Loft Law, Crain’s reports, yet another boost to tenants and yet another blow to landlords dished out by the state Legislature, which is under full Democratic control for the first time in a decade. 

The Loft Law allows an owner of a manufacturing property to formally convert a building to residential use when occupants are already living at the premises illegally. The law was conceived in the 1980s to prevent pioneering artists who had moved into rundown properties in lower Manhattan, primarily in Soho and Tribeca, from being booted out of the dwellings after the neighborhoods became more attractive and affluent. 

Residents in buildings with loft status can live rent-free until their landlord brings the building into compliance with residential health and safety codes – a process that often takes years and can be prolonged by the tenants themselves. After the units are certified for residential occupation, residents qualify for rent stabilization. The new legislation signed by Gov. Cuomo allows tenants or landlords to apply for loft status in buildings where the tenants were in residence in 2015 and 2016. The new applicants likely will be in Brooklyn, the South Bronx and Queens – where artists have tended to migrate in recent years. 

Proponents say the law makes buildings safer without displacing residents. But landlords say the law has in the past allowed tenants to drag out renovations by blocking access, which they say allows them to continue living rent-free. "It can be a years-long process to compel a tenant legally to provide access to their apartment so the conversion can be planned and then completed," says Jason Frosch, an attorney with Borah Goldstein who has represented several landlords stuck in such circumstances. "It's a huge loophole that is being exploited."