Middle-Class Enclave in N.Y. Is Sold, and Tenants Worry

Stuyvesant Town has been controversial since the 1940s, when it was built by the Metropolitan Life Insurance Co. City officials cleared 11,000 poor residents from the gang-ruled Gashouse District to make room for it. Only whites were allowed to move into the complex, until protests desegregated it several years after it opened.

At that time, however, few objected to the notion of using government subsidies to create housing for families of modest means, especially families of returning veterans.

In the decades that followed, the neighborhoods around Stuyvesant Town fell prey to arson, abandonment, drugs and crime, but the complex remained a middle-class bastion.

In the early 1990s, state legislators agreed to let rent-stabilization laws lapse for tenants at higher income levels when rents hit $2,000 a month, a luxury price at the time. Landlords were also allowed to raise rents if they renovated apartments upon a vacancy. Today, 27 percent of Stuyvesant Town's apartments have market-rate rents, an average of $3,833 for a three-bedroom apartment; a rent-regulated three-bedroom goes for $1,514.

The new landlord, the development company Tishman Speyer, cannot revoke rent controls in these complexes. But residents fully expect the landlord to expend lots of money to quickly deregulate as many apartments as possible.

Robert Speyer, the firm's senior managing director, has said residents of the rent-stabilized apartments are protected by the law.

Adam Hapij, 32, an engineer, and his wife, a lawyer working part time as she cares for their two young children, pay $2,650 a month for a deregulated two-bedroom apartment in the complex. They worry that their rent could shoot up 25 percent when their lease expires.

"I've been getting increases in salary, and promotions, but the market has been going up much faster," said Hapij, tossing a Frisbee to his 5-year-old daughter in the leafy courtyards that dot the complex. "The fact that it can creep up with no upward bound -- that's what I find most unsettling."

Mayor Michael R. Bloomberg (R) did not support the Stuyvesant Town tenants when they submitted a $4.5 billion bid to buy the complex. He has his own plan for the city to build 165,000 affordable units over 10 years, including several developments in Queens.

But tenant advocacy groups such as the Tenants Political Action Committee say Bloomberg's plan will not replace the approximately 300,000 affordable apartments that have been deregulated or have lost subsidies in the past decade.

"The mayor is pretending you can just build your way out of the problem," said Michael McKee, the PAC's treasurer. "We're never going to build as much as we're losing."

"Rent regulation feels to people like an outmoded, post-World War II, old-style policy," said Brad Lander, the director of the Pratt Center for Community Development. "But if we're not willing to use regulatory tools in a smart way, we won't have the city we want."

All this fuss over small, darkish apartments. But Rosemary Heath, who has lived in Stuyvesant Town all her life, jokes that her desirable apartment is why her husband, Bob Goddard, 60, married her. Their $1,500 rent -- though barely affordable at about 40 percent of their salary -- has certainly helped them to raise two children.

She and her husband, who own a business that develops technology for Broadway plays, are among the people who help make New York unique. For now, they'd like to stay in Manhattan.