Walmart Protest Fizzles — Is Opposition to Retail Behemoth Slowing? by Stephen Witt - YourNabe.com

Opposition doesn't seem to be slowing to me, as evidenced by this community protest...Wait until the unions get involved...Wal-mart needs to pay living wages if they want to gain a foothold in NYC...

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A smaller-than-expected crowd showed up last week at Starrett City to protest Walmart’s proposed first New York City superstore.

Organizers of the rally last Thursday at the nation’s largest low- and moderate-income housing complex predicted a turnout of 100 people, but about half that attended — many holding placards decrying the big-box retail giant’s alleged history of employee abuses, discrimination and wage theft.

“The last thing we need is a Walmart coming in to take over the neighborhood and give out minimum-wage jobs,” said Starrett City resident Maria Maisonett. “We need real jobs that pay living wages, not ones that wouldn’t even allow us to pay our rent.”

Starrett City resident Sofie Rosenblum said she was at the protest out of worry it would affect her current job.

“I work for Pathmark and my job is on the line,” said Rosenblum. “I represent the union. Walmart doesn’t treat its workers well.”

Rosenblum admitted that she occasionally shops at the non-union Target located at the nearby Gateway shopping center at Jamaica Bay — adjacent to the undeveloped Gateway II site that Walmart is eyeing.

“I do shop there, but they treat their workers better,” said Rosenblum.

Walmart executives have challenged that conventional wisdom, saying that Walmart salaries are competitive with what Target offers to both its full- and part-time workers.

“At Walmart, our associates have real opportunities to advance and build a career,” said Walmart President and CEO Mike Duke at the company’s June 2009 shareholders’ meeting. “Nearly three-quarters of store management in the U.S. started with us as hourly associates.

“And when the company does well financially, we share our results with associates,” he added. “In fact, for their 2008 performance, we distributed well over a billion dollars worldwide to hourly associates in incentive bonuses.”

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Workers at Brooklyn’s three Target stores reported the starting salary for part-time employees is $8.50, including options to sign onto a medical and retirement plan.

Similarly, employees at Walmart’s North Bergen, N.J. store said that starting salaries for part-time workers ranged from $8–$15 per hour, depending on department — also including options to sign up for the medical and retirement plans.

New York Communities for Change, an offshoot of the controversial grassroots organization ACORN, organized the protest, calling it the start of a full-fledged campaign to stop the Bentonville behemoth from coming to the city.

“There will be more events in the future,” said organization spokesman Jonathan Westin. “In the future, we will get a lot of City Council people and more community support against Walmart.”

After Two Years of Trying, Owners Give Up on Selling Starrett City by Charles V. Bagli - NYTimes.com

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Starrett City, with 5,881 apartments in 46 towers spread across 140 acres, nearly sold for $1.3 billion in 2007, but that deal was blocked. Now it is off the market. Todd Heisler/The New York Times

The owners, a group of investors led by Disque Deane, cited the faltering economy and a lack of financing as the reasons. But the sale may have foundered over price, said Donald Cogsville, who until Monday led a consortium of nonprofit organizations and developers that had been negotiating to buy Starrett City for the past two months.

Neither side would discuss details of the proposed sale, although some real estate executives familiar with the talks said that the group had offered about $700 million. Mr. Cogsville said his consortium was unwilling to raise its offer to meet the seller’s demands.

“We weren’t prepared to offer a higher price that jeopardized either long-term affordability, or a commercial return,” Mr. Cogsville said.

The owners had put the complex — 5,881 apartments in 46 towers spread across 140 acres overlooking Jamaica Bay in Brooklyn — on the auction block at the height of the real estate boom in 2006, hoping to sell it for at least $1.2 billion. But prices have plummeted since then.

Along the way, the potential sale ran into widespread opposition from tenant groups and elected officials who feared that a high price would force a new owner to oust longtime residents in favor of higher-paying tenants, or defer maintenance at what is a highly regarded complex.

Their fears were heightened by a sudden buyers’ frenzy in which private equity firms bought dozens of brick tenements in Harlem, the South Bronx and East New York with plans to profit by converting rent-regulated apartments to market rents.

In a statement Monday afternoon, the owners said that Starrett City was no longer for sale, and indicated that they did not plan to pull out of the state’s Mitchell-Lama program, which subsidizes middle-class housing, as they had once threatened.

“We plan to continue working with government to operate Starrett City as an affordable housing complex into the future,” said Martin J. McLaughlin, a spokesman for the owners, Starrett City Associates.

The efforts to sell Starrett City had unsettled many of its 14,000 tenants. But now with the sale canceled, residents expressed mixed emotions, with some saying they feel the complex’s future remains uncertain.

“We’re stuck in limbo,” said Rebecca Caraballo, 58, a retired medical assistant and a member of the Starrett City tenant association.

The possible sale of the housing complex, long a haven for working and middle-class families, had unsettled tenants. Todd Heisler/The New York Times

The owners have told public officials that they were exploring their options, including a possible refinancing of the complex, which has a relatively small $234.4 million interest-free mortgage.

Senator Charles E. Schumer and other public officials want the owners to abide by an agreement both sides signed last year intended to ensure that the complex remains affordable for the next generation of tenants.

“If the owners of Starrett City want to retain the property, then they must continue to follow a long-term affordability plan that preserves the complex and lives up to the Memorandum of Understanding we agreed to last year,” Mr. Schumer said in a statement Monday.

Starrett City, situated between Canarsie and East New York, is something of a rarity, a large housing complex that works, according to tenants and housing advocates. Its racially and ethnically mixed population of 14,000 residents have their own shopping center, post office, houses of worship and power plant.

The current owners got extensive tax breaks when they invested in Starrett City in the 1970s and annual rent subsidies from federal, state and city governments in return for rent regulation and restrictions limiting the annual return to 6 percent.

In 2007, their attempt to sell the complex to a real estate developer, David Bistricer, for $1.3 billion was blocked by tenant groups and local officials, who protested the escalating loss of moderately priced housing.

Starrett City Associates, which had initially barred bidders from talking to government officials, then worked out an agreement with Senator Schumer and state and city housing officials ensuring that the complex would remain a haven for poor, working and middle-class families.

A second effort to sell brought offers, albeit far smaller, from six separate groups that included both nonprofit housing operators and developers.

With the decision to end the sale, some real estate executives say the owners may seek legislative changes to the regulations restricting the annual profit and the amount of debt on the property.

If they are successful, the owners could do perhaps a $500 million refinancing, enabling them to pay off the old mortgage and distribute hundreds of millions of dollars to investors without having to pay taxes on capital gains. The owners could later sell the complex when the market improves.

Karen Zraick contributed reporting.

111th Congress/Congressman Ed Towns Ceremonial Swearing-In Starrett City, Brooklyn, NY Sun 1/18/09

Additional YouTube videos of the event...

Ceremonial Swearing-In for Congressman "Edolphus "Ed" Towns - Chairman, House Committee on Oversight and Government Reform

Sunday, January 18, 2009

Brooklyn Sports Club@ Starrett City
1540 Van Siclen Avenue Brooklyn, NY 11239

Deidra C. Towns/Executive Producer
Ana Carril-Grumberg/Executive Producer/Director/Editor
Colin Battiste/Cameraman/Editor/Producer

Some photos...

NY Times: Investor-to-Be in Starrett City Is Bargaining for New Deal by By Charles V. Bagli..

Rebuffed by state and federal regulators over his plan to buy Starrett City for $1.3 billion, David Bistricer is now bargaining with the current owner over a lower sale price and devising a plan that he hopes will pass muster with government officials, local politicians and the 14,000 tenants at the vast Brooklyn housing complex.

If Mr. Bistricer has any chance of success, it now seems critical that he renegotiate his deal with the current owner, Starrett City Associates. Senator Charles E. Schumer and state officials have indicated that a deal is not feasible at $1.3 billion, asserting that such a heady price would force the new owners to increase rents sharply or cut services at the ethnically and economically diverse complex.

Executives who have talked with Mr. Bistricer’s group say that the owner recently said it would consider a new proposal, but it is unclear whether the two sides can come to terms on a lower price for Starrett City, the nation’s largest federally subsidized housing complex.

The new proposal, which has not been finalized, also involves forging a partnership with the Rev. Calvin O. Butts III of Harlem and devising a way to ensure that the 5,881 apartments at Starrett City will remain affordable to poor and working-class families. Mr. Bistricer, who heads Clipper Equity, also wants to develop mostly market-rate housing on vacant land within the 140-acre complex, which sits on Jamaica Bay between East New York and Canarsie.

With many New Yorkers increasingly rattled by the price of housing, politicians including Mr. Schumer, Gov. Eliot Spitzer and Councilman Charles Barron of Brooklyn have come out against the sale.

“As Starrett City goes, so goes the city of New York on the question of affordable housing,” Mr. Barron said yesterday at a City Hall rally of tenants and housing advocates. “Not only do we need to preserve affordable housing, we need to build more of it. Otherwise, New York City will turn into a town for the rich.”

He also excoriated Mr. Butts, who heads Abyssinian Development Corporation, a well-regarded housing developer based in Harlem, for working with Mr. Bistricer.

“We’re saying to the reverend from Harlem,” Mr. Barron told a crowd of about 75 people, “butt out of our business.”

Mr. Butts disputed a suggestion by Mr. Barron that he was involved simply for the money. “We are working on something that will answer a lot of the questions that many people have,” Mr. Butts said. “I think we will maintain affordability not only for the current tenants but for tenants to come.”

If an agreement is reached, Abyssinian will have a substantial role in managing Starrett City and in developing new housing on the site.

For its part, Mr. Bistricer’s group insisted that it was not proposing steep rent increases and was supportive of reasonable state legislation that would regulate rents in complexes like Starrett City that are part of the state’s middle-class Mitchell-Lama housing program.

“Clipper’s deal to buy Starrett City will get done,” said Lisa Linden, a spokeswoman for Mr. Bistricer. “We are in discussion with many individuals, including Reverend Butts. Our plan is evolving, as well. Its centerpiece remains affordability.”

The secretary for housing and urban development, Alphonso R. Jackson, rejected Mr. Bistricer’s first proposal in March, saying it failed to show how the complex would remain a “viable community for New Yorkers of modest means.”

In April, state officials rejected Mr. Bistricer’s second proposal, saying it was unworkable under state housing laws.

Two weeks ago, Senator Schumer said that a deal at $1.3 billion was not feasible because it would require millions of dollars in additional federal subsidies, which would allow the seller to reap a windfall from the sale. He said Starrett was a successful complex because of huge federal, state and city subsidies since the day it opened in 1974. He suggested that Starrett City Associates hold a new auction or renegotiate the sale price, which he said, should be closer to $900 million or $1 billion.

The senator’s remarks seemed to signal that Mr. Bistricer’s deal was dead unless he was able to reopen negotiations over the sale price. Real estate executives who have been briefed by the Bistricer group say that Clipper has talked to the owners and put together a plan that would allow most of the tenants to remain.

Mr. Bistricer has also sought to enhance his credibility and political clout by reaching out to Abyssinian Development and Mr. Butts, who knows both Mr. Schumer and Mr. Jackson in Washington.

But critics remain unconvinced.

“The private developers interested in buying Starrett City do not have the best interests of this community in mind,” said Bertha Lewis, executive director of New York Acorn, a community-building group.