Only twelve of the 55 rent-regulated buildings identified by the rent guidelines board in Kingston reported their income and expenses to the state DHCR last year.
Close on the heels of a ruling by the state Court of Appeals upholding the City of Kingston’s rental vacancy study, five out of seven members of the Kingston Rent Guidelines Board (KRBG) voted to freeze apartment rents in rent-regulated buildings for the third straight year. Landlord representative Anthony Tampone and public member Arlene Puentes dissented.
The continuing freeze gives Vince Vaccaro, landlord of a seven-unit rent-regulated property in Kingston, trepidation. Each of the last three years, his costs have increased while the rents he charged have stayed flat.
“My Central Hudson bill has gone up, my insurance has gone up, my water has gone up, and I just got a $900 a month increase in my mortgage payment which I can’t make up,” he said.
Vaccaro, 79, says he bought the rental property to support his retirement.
“You know, we’re losing money every month,” he said. “We’re not a corporation that owns 300 units or buys 300 units at a time who can take the loss. We’re just, like, small guys.”
Vaccaro said he was not yet inclined to sell his building, but the thought had occurred to him.
“A lot of people are thinking about that, yeah,” he said. “And if we do, the question is who’s going to buy it? Is it going to be someone who knows every tenant by name and visits them? I don’t think so.”
Tampone has warned for years about the pressures inadvertently created by an across-the-board rent reduction. He worries that smaller landlords could be driven to sell out to large firms which buy investment rental properties at scale.
“If you chase out the entry level, lower- or middle-class rental property owners,” Tampone said, “you might end up getting exactly the monster that everyone is afraid of.”
Uptown Kingston Properties, LLC entered the Kingston renting market with two buys in January and March of 2023. It spent over $5.5 million to purchase eleven properties, six of them apartment buildings, only one of which, 58 Fair Street, was rent-regulated.
In May 2024, Arena Holdings spent $3.77 million to scoop up six apartment buildings, three of which — 19 Downs Street, 31 Green Street and 86-90 Pine Street — were rent-regulated.
“I think we need to think about what happens to our community when we lose this these types of buildings to these companies,” Tampone said. “Every dime of rent that anyone ever pays will never come back to this community.”
Whether these LLCs are front groups for moderately-sized local operators or massive private equity firms buying investment properties is not known.
Under current state law, limited liability corporations don’t have to reveal the identities of their beneficial owners. This will change on January 1, 2026, when the LLC transparency act signed into law by governor Kathy Hochul in December 2023 takes effect.
Since Kingston opted into rent regulation three years ago, 14 buildings have been sold, almost a quarter of the initial pool of 59 rent-regulated buildings identified by city director of housing Bartek Starodaj.
Was the fear of losses due to rent regulation a deciding factor for those choosing to sell? Landlord and broker Greg Berardi of Berardi Realty counsels patience. “When a landlord calls me with that question my answer is, you can’t afford to sell,” Berardi said. “The only thing you can hope for is that a valid vacancy study gets done and that we get taken out of this.”
Berardi, who owns one rent-regulated building in Kingston, said that the best he could expect to recover if he were to sell it right now would be the price he bought it for seven years ago.
“Now if this rent rollback goes into place,” he reasons, “and I roll my already low rents back 15 percent, they’re going to get me in a spot where I’m going to have to sell the building at a loss because I can’t afford to keep paying a thousand or two out-of-pocket every month.”
In 2022, one of the first guidelines the board passed was that a 15 percent rent reduction should be applied across all units going forward. Before the board could vote these guidelines into law, landlord lawyers filed court challenges to the vacancy study. Tenant activists allege that during the near three years the court cases played out, landlords had chosen to wait for the result before abiding by the rent reduction.
That rent regulation is unattractive to new investment is borne out by at least one sale of a rent-regulated building. Before the city opted into rent regulation in March 2022, Uptown Kingston Properties, LLC, paid $935,000 to purchase a seven-unit apartment building at 58 Fair Street. The LLC unloaded the property in May 2024 at a $135,000 loss.
Landlord and court opponent of Kingston’s vacancy study Rich Lanzarone has been warning the rent guidelines board all-along that rent regulation precedes a rental housing market which falls into decline.
“The Security Exchange Commission now requires all publicly traded banks to inform investors that they have to file these things called K-1s,” said Lanzarone. “They tell the investors, here’s the condition of the company, and they disclose to investors the extent of their quote ‘toxic loans,’ — their rent-regulated loans — because they know you’re not making profit. They know you’re ‘on the road.’ And that’s gonna be bad for you paying back what you owe.”
Lanzarone uses the hypothetical need for a $50,000 new roof for a ten-unit rental property he owns in Kingston as an example.
“Say I need a new roof,” he says. “I go to the bank and say, look, I want essentially the equivalent of a home equity loan to replace the roof. The bank says, first of all, you’re on our naughty list — our list of potentially distressed loans. And number two, because they’ve seen your income-and-expense report, because you’re rent-stabilized, you’re gonna have to pay back this loan, and it’s going to be like $2000 a month. So where’s the additional income coming from to pay back the loan?”
Doing some quick tabletop math, dividing his $50,000 by 180 months, and dividing that number by ten apartments, he would conclude that by raising the rent of each apartment by $27 a month he could make the nut.
But because of the rent freeze, Lanzarone says, the bank will be unwilling to work with a landlord to loan the money with lower monthly repayments.
And thus begins the road to ruin for a landlord’s bank account and the quality of the apartment.
“Guess what?” he asks. “You’re not getting a new roof. You’re patching that roof, and patching that roof until the roof leaks. And now you’re the bad landlord at the city meetings, but really you can’t do anything about it.”
The fears of small-landlord insolvency are overstated, some members of the KRBG believe.
Informing his vote to support another rent freeze, board chair Noah Ogman-Kipley said he compared cost-to-income-ratio data for rent stabilized landlords in Kingston against other rent-regulated municipalities, such as those in Westchester County.
“The data shows that the buildings in Kingston produce a lot more free cash flow than the Westchester ETPA buildings,” Ogman-Kipley says, referring to reports posted on the Department of Homes and Community (DHCR) website. “In Kingston, when a tenant pays a dollar in rent, 50 cents of that goes to pay for taxes and maintenance and water and all of that stuff. Just 50 cents. In Westchester, it’s 64 cents.”
To arrive at operating expenses, Ogman-Kipley excludes interest and depreciation. Compared to what landlords in Westchester earn, landlords in Kingston are earning 15 percent more on average. But as averages they lack nuance. One property owner’s financial situation need not resemble another’s. What’s more, the numbers quoted represent just a fraction of all landlords encumbered by rent regulation.
Since the first vacancy study a handful of buildings- including Lanzarone’s- have been exempted from rent regulations. In 2025, only twelve of the 55 rent-regulated buildings which remain reported their income and expenses to the DHCR.
Year after year, whether responding to the original vacancy survey in Kingston, or at the state-level registering their properties or reporting their income-and-expense information, this level of cooperation has been typical among rent-regulated landlords. Like bartenders and waiters are known for underreporting tips, landlords have been known for exaggerating their expenses.
If the landlords who do report their income and expenses are representative, then the landlords may be doing better than they let on.
Regardless, Ogman-Kipley said he was concerned with the financial viability of some of the rent-regulated buildings in Kingston. ”And that’s why,” he said, “I have at many occasions over the past three years encouraged owners who are not making enough profit from their ownership to use the hardship provision of ETPA to file a request with DHCR to allow their specific building to raise rent.”
According to the DHCR, as “a rent-regulation system that required owners to maintain artificially reduced rents in the face of chronic operating losses would be viewed as confiscatory,” Their remedy has been to offer hardship exemptions to landlords of rent-regulated properties whose operating expenses were not less than 95 percent of the gross rental income.
In practice, however, DHCR records reported by Suzannah Cavanaugh in The Real Deal indicate that from 2022 to 2024 no landlord anywhere in New York State seeking a hardship exemption succeeded.
“To my knowledge no owner has used this process in Kingston,” said Ogman-Kipley, “or has even started that process.”
The state can keep its exemption, according to Berardi. He’d rather see the value of his rent-regulated property reassessed to reflect the economic consequences of rent stabilization.
“A very smart person in the real estate business, Mike Bernholz, from Hudson Valley Appraisal Services, said, ‘if they want to subsidize the rent, they need to give something back to the landlord,’ Berardi said. “And it may not be 100 percent fair, and the landlord may not necessarily agree with it, but something as simple as ‘you devalued my property, now drop my assessment to reflect that, so at least I’m not being overtaxed.”
Berardi said that the regulated building he owns in Kingston had been assessed at about $850,000 before his property was encumbered by rent control.
“But this year I go in with all my financials, and I sit down with the assessor [Dan Baker], and I said, here’s my real numbers right from the management company. Do you dispute these numbers? No, not at all. Do you dispute my income? No. Do you dispute my expenses? No.
“I was like, okay, well, I have a $36,000 net income at the end of the year, if I didn’t have a mortgage. And that means at a ten percent return, my building’s worth $360,000. And if you wanted to use a lower rate of return, maybe it’s worth $400,000. Do you dispute that?
“And the assessor said, no, I don’t dispute that. I don’t dispute the information you’re giving me to be false. I said, okay, are we going to drop my assessment, knowing that I cannot change my rent, and this is the real net operating profit?”
Baker, Berardi said, wouldn’t sign off on the assessment reduction because he was concerned that if he did every other rent-stabilized property owner in Kingston would follow suit and would be beating down the doors to get their properties reassessed.
Berardi provided the outcome of the scenario he was presenting.
“In my case, and I’m sure other landlords, they’ve encumbered my value 50 percent or maybe even more,” he said. “So my next step now that they denied me is to sue them. When I win and other rent-controlled property owners do the same, you’re talking millions and millions of dollars in lost tax revenue because they’re going to have to value these rent-stabilized properties for what they’re worth now.”
City of Kingston director of communications and community engagement Summer Smith responded to Berardi’s allegations.
“Unfortunately, Mr. Berardi has mischaracterized and misquoted his conversation with Mr. Baker…Mr. Berardi’s assessment complaint was delivered to the City of Kingston’s board of assessment review, and on the merits the board determined that no assessment change was warranted.”
Because of the political fallout generated by rent regulation, irrespective of their actual landlording practices, both Vaccaro and Berardi said they had at times felt unfairly demonized as rent-gouging greed-heads. The vitriol seems to have caught them off guard.
Berardi, who does not think the ownership of his more than 500 rental units qualifies him as a large landlord, said: “I’m a landlord that never went after max rent. But when things like this happen, that’s going to make me not be able to do that. I can’t afford to lose 50 percent of the value of another property. I just sold 40 apartments I owned in Saugerties. So once this rent stabilization came to Kingston, I said, Oh my God, our property in Saugerties is going to be the same thing! Well, what did I end up doing? I raised [the rent of] ten of the 40 tenants $300 to $500 a month per unit. Now that sounds like a lot, but they were still $200, $300 less than market. That just shows you how I wasn’t charging crazy rent.”
Whether rent-regulation will continue in Kingston will depend upon the results of the completed rental vacancy survey, expected to be released in August.
If any number of vacant apartments are discovered to add up to higher than five percent, the city can declare the housing emergency has come to an end. If it does, the rental guidelines board can be dissolved and the rental market can return to its previously unregulated state.
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