And another landlord feeds the Cancel Rent fire! Brooklyn

And another landlord feeds the Cancel Rent fire! Brooklyn

Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes

A few days after losing his job in March, Paul Gentile was throwing away trash outside his Brooklyn apartment building when he noticed a new sign hanging near the front door.

Because of the coronavirus pandemic, which has brought life to a near standstill in New York City and caused an untold number of people to lose their jobs, tenants in the building did not need to pay April rent, it read.

“STAY SAFE, HELP YOUR NEIGHBORS & WASH YOUR HANDS!!!” the landlord, Mario Salerno, wrote on the signs, which he posted at all of his 18 residential buildings in the borough.

It is too soon to get an accurate gauge of how many renters withheld their April rent and what the fallout would be for landlords.

But Mr. Salerno said in an interview on Thursday that he did not care about losing his rental income in April, nor did he care to calculate the amount that he would not be collecting from his 80 apartments. He said he had about 200 to 300 tenants in total.

He is likely forgoing hundreds of thousands of dollars in income by canceling April rent.

His only interest, he said, was in alleviating stress for his renters, even those who were still employed and now working from home.

“My concern is everyone’s health,” said Mr. Salerno, 59, whose rent gesture was first reported by the local news site Greenpointers.com. “I told them just to look out for your neighbor and make sure that everyone has food on their table.”

https://www.nytimes.com/2020/0...

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Real Estate Investor · Chattahoochee, FL · Member since 2014 · 133 posts · 107 votes
6y

I'm not sure what the issue is? He's doing something nice for others. What am I missing? I may not have caught the discussion on this issue on BP so I'm a bit lost. Is there an issue or am I misreading your intention? I'm not trying to start a fight I just don't get what you mean. Thanks.

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  • Bjorn AhlbladPro Member
    Investor · Shelton, WA · Member since 2017 · 6k+ posts · 6k+ votes
    6y

    @Patrick M. Very glad to not be a LL in NY especially not in Mr. Salerno's neighborhood! I'm speechless!!

  • Real Estate Investor · Chattahoochee, FL · Member since 2014 · 133 posts · 107 votes
    6y

    I'm not sure what the issue is? He's doing something nice for others. What am I missing? I may not have caught the discussion on this issue on BP so I'm a bit lost. Is there an issue or am I misreading your intention? I'm not trying to start a fight I just don't get what you mean. Thanks.

  • Investor / Broker · Brooklyn, NY · Member since 2016 · 665 posts · 1k+ votes
    6y

    What Mr. Salerno did was helped people regardless of how much they really needed it.

    The Article mentions Mr. Gentile, an Attorney who was just let go but will be rehired when the economy bounces back. He also has a Fiance, whom I speculate to be someone who may be doing well herself.

    Regardless, he Father owned a Auto Body Shop since 1959. He himself bought properties in 80s and in the 90s turned all of the lots into Apt buildings.

    In other words, the guy was really wealthy and go lucky to be in Williamsburg, one of the highest appreciating neighborhoods in all of America.

    This is more analogous to the Billionaire Robert Smith who paid off all of the loans for Graduates from Morehouse in his class, including their Parent's loans.

    Personally, I think if you are going to give Charity, give it to those that are struggling or at least give a Means Test to distribute the money so that you don't give it away to people that really don't need it as much as others that are struggling.

    Better to donate the money to a good cause than to arbitrarily give it to people whether or not they need it.

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    @David Clay

    There is a growing number of people, pols and media outlets that are propagating the idea that landlords can do without rent. And more so, that they should do without rent because of the current climate.

    When landlords decide to advertise their acts of kindness, give themselves a very public pat on the back, they feed this notion that rent is pure profit. 

    I am clearly in the minority in believing that acts of kindness don't count if you are trumpeting them all over town.

  • Real Estate Investor · Chattahoochee, FL · Member since 2014 · 133 posts · 107 votes
    6y

    @Patrick M. and @Llewelyn A. 

    OK. I see what you're saying. 

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    I got a fiver that says some Brooklyn landlords are going to plaster notices all over his building for May, June...

  • Investor · Atlanta, GA · Member since 2013 · 3k+ posts · 3k+ votes
    6y
    Originally posted by @Patrick M.:

    @David Clay

    There is a growing number of people, pols and media outlets that are propagating the idea that landlords can do without rent. And more so, that they should do without rent because of the current climate.

    When landlords decide to advertise their acts of kindness, give themselves a very public pat on the back, they feed this notion that rent is pure profit. 

    I am clearly in the minority in believing that acts of kindness don't count if you are trumpeting them all over town.

     Why do you assume that he's the one that loudly advertised his action? Isn't it a lot more likely that one of his tenants was really happy about it and let others know and then media came and asked for the landlord's comments? 

    I don't think it's for us to decide who deserves charity, if it's someone else that's giving. It's his money and he can do with it what he wants. I just think some real estate investors are up in arms, because they're afraid that their own tenants expect the same. But that can happen with anything in life. 

    I think he did a nice thing and if he can afford it it's great for the tenants. 

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    "I just think some real estate investors are up in arms, because they're afraid that their own tenants expect the same."

    Uh.. yeah, did you not get that from the title... are you reading the paper? Google cancel rent movement.

  • Investor · Atlanta, GA · Member since 2013 · 3k+ posts · 3k+ votes
    6y

    FYI - I voluntarily contacted all of my tenants and lowered their April rents. Just because you're afraid to look bad in comparison, does not mean that we're all doing something wrong. 

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    @Michaela G. I am not afraid to look bad in comparison. 

    i am very concerned for the landlords, of which I consider myself one, who rely on our rent to operate our businesses, continuing to provide our tenants with shelter and services.

  • Investor · Akron, OH · Member since 2016 · 2k+ posts · 4k+ votes
    6y

    I'm not in a position to make such a generous gesture. I do think if a tenant points out or asks about such a gesture, the best thing to do is to acknowledge the man's generosity. I would probably say I wished I was in a position to be so generous but right now what I can do and am doing is working with all out of work tenants and tenants that are off without sick leave.

    I'm also not sure it's the best idea to make a such big gesture right now as I expect that the bigger problem will be down the road in the (likely) event that the economy doesn't bounce right back after the immediate crisis passes.

  • Rental Property Investor · Los Angeles, CA · Member since 2017 · 2k+ posts · 5k+ votes
    6y
    Originally posted by @Michaela G.:

    FYI - I voluntarily contacted all of my tenants and lowered their April rents. Just because you're afraid to look bad in comparison, does not mean that we're all doing something wrong. 

    And just because you decided to give charity blindly doesn't mean you're doing something right.

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    @Jill F. agreed- I believe the vast majority of us are working with the tenants that require assistance.

    Affluent landlords are discounting and cancelling rent across the board.

    Unfortunately the media does a poor job of Distinguishing between the rich landlords and the small businesses which relay on rent to fund their operations.

  • Investor · Atlanta, GA · Member since 2013 · 3k+ posts · 3k+ votes
    6y
    Originally posted by @Patrick M.:

    @Jill F. agreed- I believe the vast majority of us are working with the tenants that require assistance.

    Affluent landlords are discounting and cancelling rent across the board.

    Unfortunately the media does a poor job of Distinguishing between the rich landlords and the small businesses which relay on rent to fund their operations.

    You also shouldn't assume that all of us who discount the rent are affluent. I simply felt that we're all in this together and I dropped my rents to a little above my mortgages. For one thing, I can live without profit for a month. I don't have an expensive lifestyle. But it also makes tenants think of me as a great landlord and they're less likely to take advantage of the eviction moratorium that is happening in Atlanta. So, I'm trying to preempt that, in addition to being human. 

    I'm only giving away profit. If I can pay my mortgages I'm ok. Next month people will have unemployment and the stimulus checks. Most of my tenants are artists, who share a place between 2 or 3. So, even if they get a low paying job, they will still be able to pay the full rent then. This just gives them some breathing room and they don't just wait out the eviction or take off in the middle of the night to move back in with parents. 

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    @Michaela G. This months profit may be next months mortgage payment.  Many people assume this will be over by May.

  • Investor · Atlanta, GA · Member since 2013 · 3k+ posts · 3k+ votes
    6y
    Originally posted by @Patrick M.:

    @Michaela G. This months profit may be next months mortgage payment.  Many people assume this will be over by May.

    People will get unemployment and stimulus checks in April, which should cover May rent, unless it's high rent. But many of the higher income people haven't lost their jobs. It's the lower income jobs that were wiped out by this, which many of my tenants have. And their rents usually aren't so high in the first place, so the stimulus will cover it. Many of mine are 2 or 3 in a place, so, they get multiple checks per household. 

    And many get tax refund checks any day as well. 

    I work from thoughts of abundance and not scarcity. 

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    "I work from thoughts of abundance and not scarcity."

    @Michaela G. ouch!

    No way for me!

    I prepare for the worst and hope for the best. My tenants shelter depends on my keeping my buildings afloat. I require rent For that.

    Did your market just get put on lockdown? Will you be canceling May's rent? Do you plan on abundance returning in April or May?

  • Developer · New York City, NY · Member since 2015 · 812 posts · 718 votes
    6y
    Originally posted by @Michaela G.:
    Originally posted by @Patrick M.:

    @Michaela G. This months profit may be next months mortgage payment.  Many people assume this will be over by May.

    People will get unemployment and stimulus checks in April, which should cover May rent, unless it's high rent. But many of the higher income people haven't lost their jobs. It's the lower income jobs that were wiped out by this, which many of my tenants have. And their rents usually aren't so high in the first place, so the stimulus will cover it. Many of mine are 2 or 3 in a place, so, they get multiple checks per household. 

    And many get tax refund checks any day as well. 

    I work from thoughts of abundance and not scarcity. 

    Maybe things are different in Atlanta than in NYC and surrounding areas. You are naive to think so. If a tenant needs assistance, we will of course work with them. Wipe out their rent for a month to be nice? No. That can set a precedent and they will expect it again. Yes, you give them one month, but what happens if this lasts for two, three, six months or more?  Our experience with NYC tenants are if you give them some slack when they do not really need it, they will continue to push and pull to see how much they get away with. While it's nice that the landlord was a Good Samaritan, there can be some negative consequences due to his actions. Not just for others, but his properties as well. How long do you think he can go without feeling pain from not receiving rent two, three or more months?

    Plan ahead, not in the moment. But hey, what do I know. I am just an old man from NYC.

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    @Michaela G.

    WSJ Article Job Loss

    Please read this article if you think this is just some snow day. Projections of 27.9 millions jobs lost by end of May- wiping out a decade of job growth.

    This is not going to be just lower income restaurant workers! 
    Get prepared!

  • Developer · New York City, NY · Member since 2015 · 812 posts · 718 votes
    6y
    Originally posted by @Patrick M.:

    @Michaela G.

    WSJ Article Job Loss

    Please read this article if you think this is just some snow day. Projections of 27.9 millions jobs lost by end of May- wiping out a decade of job growth.

    This is not going to be just lower income restaurant workers! 
    Get prepared!

    True. On the flipside, some great bargains in the stock market soon.  Also, build up a cash reserve as there will be foreclosures and short sales to acquire.

    Get prepared my friends. Get prepared.

  • Investor · Atlanta, GA · Member since 2013 · 3k+ posts · 3k+ votes
    6y

    It's ok. Others always think I'm crazy when i zig when everyone else zags. Lol

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    6y

    Sorry- if you haven't noticed you are zagging with everyone else. 

    Those of us who are zigging are clearly in the minority.

    But if I was an affluent landlord who didn't need to be concerned about June and July's expenses perhaps I would join you all.

  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    6y

    First and foremost, it's his money and he can do whatever he wants with it.

    I personally disagree with his practice. When you give tenants something for free, they have a tendency to abuse it. I manage a lot of rentals and know even more Landlords. Many of them have "gifted" free rent, rent reductions, and other things to their renters. It almost always comes back to bite them!

    Just one example. My father-in-law would take them a nice card after Thanksgiving, letting them know the month of December would be free. I warned him against it, but he wanted to be nice and it's his money. Their tenant lost her job so they gave her a 25% reduction in rent because she was a single mom and they wanted to help her out. After the rent reduction was done, she stopped paying rent. It took two months to get her out and then it cost them almost $20,000 to renovate the place. Purple hair dye on the carpet, holes in walls, broken doors and light fixtures, appliances had to be replaced, etc. All told, their generosity cost them over $25,000.

    It's their money. I wish they would have given it to someone deserving that would have appreciated it.

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  • Real Estate Investor · Chattahoochee, FL · Member since 2014 · 133 posts · 107 votes
    6y
    Originally posted by @Calvin Thomas:
    Originally posted by @Patrick M.:

    @Michaela G.

    WSJ Article Job Loss

    Please read this article if you think this is just some snow day. Projections of 27.9 millions jobs lost by end of May- wiping out a decade of job growth.

    This is not going to be just lower income restaurant workers! 
    Get prepared!

    True. On the flipside, some great bargains in the stock market soon.  Also, build up a cash reserve as there will be foreclosures and short sales to acquire.

    Get prepared my friends. Get prepared.

    I'm selling a house right now to help with reserves for this very issue. I bought another fixer-upper recently that requires significant work. I'm sorry I did it b/c I think there might be better bargains in the near future. I hate to take advantage of people's difficulties, but when the foreclosures it'll be better to get them back into the market. Shoulder shrug, I just hope to be positioned for it if it happens. I think the big thing is that we don't know what is going to happen as this is unprecedented in recent times. Congress may pass legislation that supports homeowners and prevent any foreclosures for missed payments during this period. If they do I will applaud them for it. Not sure it wouldn't get a veto. No politics, just speculation about what people might do or not do. 

  • Real Estate Investor · Chattahoochee, FL · Member since 2014 · 133 posts · 107 votes
    6y
    Originally posted by @Nathan Gesner:

    First and foremost, it's his money and he can do whatever he wants with it.

    I personally disagree with his practice. When you give tenants something for free, they have a tendency to abuse it. I manage a lot of rentals and know even more Landlords. Many of them have "gifted" free rent, rent reductions, and other things to their renters. It almost always comes back to bite them!

    Just one example. My father-in-law would take them a nice card after Thanksgiving, letting them know the month of December would be free. I warned him against it, but he wanted to be nice and it's his money. Their tenant lost her job so they gave her a 25% reduction in rent because she was a single mom and they wanted to help her out. After the rent reduction was done, she stopped paying rent. It took two months to get her out and then it cost them almost $20,000 to renovate the place. Purple hair dye on the carpet, holes in walls, broken doors and light fixtures, appliances had to be replaced, etc. All told, their generosity cost them over $25,000.

    It's their money. I wish they would have given it to someone deserving that would have appreciated it.

     Broadly speaking I agree with the idea that you can't let tenants mistake their relationship with you. I have established a policy of no leeway and no considerations b/c I'm trying to be helpful. I did the same thing your FIL did. Helped a tenant for years and then on the way out conflict and about 5-8k in damage and two months of unpaid rent. I think I hear a different sentiment regarding the charity. I'm not necessarily in the same line of thinking in that regard, particularly now. There could be some problems, but who knows. In any event, I think doing good for others is great. His actions shouldn't have an impact on what my tenants think - I Hope. :) We'll see. 

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