Louis Proyect: The Unrepentant Marxist

July 23, 2018

The New York City real estate/housing crisis, part 3

Filed under: housing,real estate — louisproyect @ 4:06 pm

An ongoing impromptu demonstration across the street from my high-rise building on Manhattan’s exclusive upper east side reminded me of a series of posts I started on real estate. Kaia, a tiny wine bar that featured mostly appetizers native to South Africa and that was shut down by tax collectors, has prompted its loyal customers to post statements of solidarity on its windows next to the tax collector’s scary looking red sign. In all the years I have been living in Manhattan, I have never seen such a proclamation even though bankruptcy notices are omnipresent.

I am in no position to judge the merits of the actual tax liability incurred by Kaia but I have a feeling that owner Suzaan Hauptfleisch was perhaps delaying tax payments because of the onerous rent she was paying for the tiny space of around 500 square feet, which I estimate to be about $10,000 per month. Wine bars typically are closed until around 5pm so this meant that this would require heavy traffic every night. My wife and I used to stop in at Kaia’s when it opened in 2010 but were forced to become former customers when a glass of wine began to cost at least $15. I have no idea how the regulars there could afford the place but then again one bedroom condos in the neighborhood are going for $850,000.

Hauptfleisch’s background is noteworthy as the Falung Gong free newspaper, of all places, reports.

Hauptfleisch grew up on one of the oldest farms in the Free State. Her family owned it for 250 years.

“We were people from the land,” she said. “I loved walking long distances and singing at the top of my lungs as a child.”

“We had a big farm. … I walked through corn fields to be alone and get away from it all,” she said.

Hauptfleisch grew up during apartheid. She recalled living in perpetual fear of farm killings.

“That was always a problem in the early 1990s,” she said. “People would murder entire families on white farms.”

It was uncommon for white South African farmers to be liberals during that time, but Hauptfleisch’s family was. In 1968, Hauptfleisch’s paternal grandmother Cienie Hauptfleisch founded a school on the farm for black children.

The school had one teacher, who taught at levels from first grade to ninth grade until the family lost the farm in 1993 due to financial troubles.

But during its 25 years of existence, the school produced several students who went on to higher education and became teachers, lawyers, and doctors.

“To this day, I believe we weren’t touched because of my [family’s] name,” Hauptfleisch said.

A couple of days ago, I stopped in front of Kaia’s and struck up a conversation with a woman who was not only a customer but someone who completely understood the real estate crisis in New York that besides forcing people into homelessness makes places like Kaia casualties of greedy landlords. She referred me to a story that appeared on NY One, the city’s cable TV all news network:


Artist displays Monopoly-like cards on vacant Manhattan storefronts

By Lindsey Christ  |  July 6, 2018 @10:11 PM

At the legendary corner of Bleecker and MacDougal streets, several storefronts are empty. Pasted on the windows are mysterious posters resembling oversized Monopoly cards.

“It looked like a big game between tenants and landlords and politicians, and nobody wanted to take responsibility for anything, and everybody was just trying to play this big game,” said the artist who created them.

The artist says he has placed them on 80 vacant storefronts in Manhattan over the past three weeks, a one-man protest of how rising rents are forcing many shops and stores to close. He agreed to talk to NY1 only if he appeared in disguise.

“New York as a vibrant city is losing something,” he said. “We gain nothing from storefronts that sit empty. There’s no nightlife, there’s no life there, there’s no merchandise. Nothing’s happening, and it’s a loss for all of us.”

One Monopoly card is posted on 203 Bleecker Street. Carol Walsh’s store, Native Leather, had been here 49 years until October, when she says the landlord made it impossible to stay.

“He wanted to practically double the rent for the next tenant,” she said. “And I mean, I couldn’t do it.”

NY1 recently counted more than 50 empty stores along Bleecker Street, an iconic Greenwich Village address.

Experts say it’s not just rising rents causing the wave of vacancies, but also the shift to e-commerce.

The Monopoly cards also are displayed along Broadway and Lexington Avenue, and around the Lower East Side.

The artist says he would love to make Madison Avenue and Fifth Avenue versions of his Monopoly cards to paste on empty storefronts uptown, but he’s worried that area might be a little too high-profile for his unsanctioned art.

“Lots of security cameras, so maybe in the stealth of night, I’ll visit them,” he said.

He came up with the monthly rent prices on the cards from Real Estate Board of New York reports.

He says the response, online and on the street, has been overwelmingly positive.

“People really seem to fall in love with this, and they’re really understanding and getting the message, which I find fantastic.”

He says he will continue to post his Monopoly cards because in this real life game of real estate, New Yorkers continue to be losers.

I recommend a visit to the NY One website  to see the video interview with the artist that accompanies the article.

I also recommend tracking down the July issue of Harper’s that has an article titled “The Death of a Once Great City: The fall of New York and the urban crisis of affluence” by Kevin Baker that is thankfully not behind its paywall. Baker writes:

Between 2010 and 2014, Lynch writes, the rents in sixteen Manhattan retail corridors tracked by ­CBRE Group, the self-described largest commercial real estate services and investment firm in the world,

skyrocketed by a whopping 89.1 percent while total retail sales for the borough grew by only 31.9 percent, creating what the commercial brokerage firm called “an unsustainable situation for some tenants as rents surpassed what their sales growth could support.”

What’s more, this price gouging continued even as vacancies multiplied, a supposed impossibility under classical capitalist economics. The better business got, the more stores went under and were abandoned. The more storefronts went vacant, the higher rents kept going.

In some of the swankier districts of Manhattan, this can lead to the likes of Gwyneth Paltrow, Kanye West, or Tommy Hilfiger “popping up.” In less glamorous neighborhoods, such as my own, it’s more likely to mean the headquarters of a political campaign, or the ubiquitous Halloween costume stores that open now in mid-September. But wherever and whatever they are, the lesson is the same: everything is temporary. The whole idea of a permanent community is fading away.

For previous articles in this series, go to https://louisproyect.org/category/real-estate/.



  1. The same thing has happened to San Francisco and, for me, even more sadly, Oakland. To the east here in Sacramento, we are in the early stages and we will see similar effects within 5 to 10 years. I may be overly optimistic.

    Comment by Richard Estes — July 24, 2018 @ 7:24 pm

  2. Hard Errned leesons of Public Housing LINKS.

    Does this count for something?

    Comment by Curt Kastens — July 25, 2018 @ 2:28 pm

  3. Hi,
    This was very sad and bad. And what is the story behind death of once great city?

    Comment by Simple Transactions — November 13, 2018 @ 10:22 am

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