Affordable Living in Chelsea A Look at Manhattan's Penn South Co-op

Affordable Living in Chelsea

A casual passer-by on Eighth Avenue in Chelsea could easily pass a particular cluster of high-rises on the west side of the street and think they're just a group of typical Manhattan residential buildings.

But they're not. Mutual Redevelopment Houses Inc. - better known as Penn South - is more like a town within the city. Penn South has a uniformed security force, a staff of 110 employees, its own power plant (which enabled the development to have uninterrupted power during last year's blackout), a community garden, an exercise room, an extremely active seniors' program, a group of stores and restaurants on the premises, and even a theater or two.

Penn South was built as part of a wave of city- and state-subsidized co-op developments in the "˜60s, along with Starrett City, Co-op City, Rochdale Village and quite a few others. But it hasn't had the difficulties of, for instance, Co-op City, which had to close most of its garages because of structural problems. Penn South still remains an extremely desirable place to live for people looking for affordable housing - at one time the waiting list, which has been supplanted by an apartment lottery, was 15 years long.

And perhaps most remarkably, Penn South's shareholders have consistently voted against "going private," although if they gave themselves the right to sell their apartments on the open market, they certainly would be able to get very high prices for them. Instead, they've decided to give others the same opportunity for affordable middle-income housing that they had. By contrast, several other subsidized co-op developments did vote to go private, such as the Grand Street co-ops - which were built around the same time and designed by the same architect.

Penn South's decision shouldn't be surprising, because it is known for its political liberalism - one gets the feeling that the complex is a mini-Blue State unto itself. Many of the early residents were members of the ILGWU (International Ladies' Garment Workers' Union, the complex's original sponsor) and other unions. On the dais at the complex's opening ceremonies in 1962 were President John F. Kennedy, Eleanor Roosevelt and David Dubinsky, head of the ILGWU. As a matter of fact, Penn South (meaning "south of Penn Station") was known at first as the ILGWU Houses.

From Tenements to Terraces

Penn South was originally a slum clearance project, says Brendan Keany, the development's general manager. (Residents of the tenements that were torn down to make room for it did, by the way, get first crack at the apartments). In those days, Chelsea was dominated by tenements and factories, with pockets of drug dealing and prostitution.

Even some people who lived in Penn South during the "˜60s and "˜70s remember the surrounding area as having few restaurants, few supermarkets and poor street lighting. Now, of course, "Chelsea has become an upscale neighborhood, and the old brownstones nearby have greatly increased in value," says Walter Mankoff, Penn South's treasurer and a resident since 1971.

The development was built as a city-sponsored Article 5 Redevelopment Corporation under a program similar to, but slightly different from the better-known Mitchell-Lama program. The cooperators came from not only Manhattan, but from Brooklyn, the Bronx and Queens, and most came to the development from rental apartments. Originally, says Nat Yalowitz, a former co-op vice president for 15 years, "You had a totally non-resident board. About three years after it was occupied, we elected our first resident board member. Within five years, you had a board made up of residents," and people began to feel more of a stake in their community and to get more involved.

"Many of the original people who moved in were people who were close to retirement age, and the development is still about 70 percent over 70 years of age," says Keany. Thus, it qualifies as a Naturally Occurring Retirement Community, or NORC (more about this later). Still, the number of younger people is increasing, as is evidenced by such entities as the Parents Committee and the Toddler Playroom Committee.

Penn South stretches from West 23rd to West 29th Streets, between Eighth and Ninth Avenues. It contains 15 buildings with 2,820 apartments, surrounded by lawns and trees, with two playgrounds. Occupying commercial space here are a Dallas Bar-B-Q, a Clearview movie theater, a tennis court, a medical clinic, a Gristede's supermarket, a Dunkin' Donuts and, most recently, the trendy Upright Citizens Brigade comedy theater, among others.

Monthly maintenance charges, Keany says, are "very reasonable," about $150 per room. David Smith, a longtime, influential cooperator who served as board president for 20 years, says, "A two-bedroom apartment here sells for about $18,000, as opposed to one in the Grand Street co-op, which sells for over $599,000." Subsequently, a two bedroom in Penn South goes for about $23,000, and a three-bedroom, $29,000, compared to those same downtown apartments that range from about $400,000 to upwards of $750,000.

Both equity and maintenance charges have gone up, of course - Keany says maintenance charges will probably go up in a year or so - but slowly and in relatively small amounts.

Capital Improvements

Because the co-op is now more than 40 years old, there have by necessity been some major capital improvement projects. In the mid-1990s, for example, the buildings' windows were all replaced. This project, says Mankoff, cost about $11 million. More recently, about a year ago, Penn South's underground electrical cables, which also had deteriorated, were replaced, a project that Keany said cost about $5 million.

And just during the past few months, the buildings' front doors were replaced by push-button doors. Now, when a resident comes in from the outside, he or she can turn a key on the wall of the entranceway and both doors swing open automatically. This both helps elderly shareholders, who need time and room to move their walkers or wheelchairs, and shoppers who may be carrying heavy bags and don't have a free hand to open the door.

Penn South's most unusual physical feature, many people would agree, is its cogeneration plant, a low-rise building between West 25th and 26th Streets. The building housed an old-fashioned steam boiler plant until about 1986, when the co-op decided to convert it to a cogeneration facility.

Nowadays, it generates the buildings' electricity, provides hot water, and provides heating and cooling through a convector system (although some cooperators have their own window air conditioners to supplement the convectors). All in all, says Keany, it saves about a half-million dollars a year.

These projects, and others, says Mankoff, are all financed by a combination of "borrowing and equity assessments." And, adds Mankoff, Penn South also took advantage of low interest rates to refinance. "We recently refinanced our mortgage through a partnership between Fannie Mae and the Amalgamated Bank for $63 million at 4.17 percent."

Active Community Life

Penn South is known for its active community life - Keany estimates that at least half of all residents vote at the annual shareholders' meeting. Penn South has not only a board of directors but a Co-op Council, which takes care of problems within the buildings themselves, such as lighting in the stairwells.

The co-op also sponsors many groups and clubs, which are coordinated by the education director, Naomi Goldstein. Some of these include a woodworking club, a recently introduced ceramics studio, the aforementioned toddler playroom and youth recreation room, a computer club, and more.

An exercise room with state-of-the-art equipment, including treadmills, cross-country skiing machines, weightlifting machines, exercise bikes and a rowing machine was established several years ago. With 500 members now, the initial outlay to build the facility has been recouped through membership fees.

On the south side of 25th Street is the Jeff Dullea Intergenerational Garden, where cooperators of all ages have individual plots to grow flowers and vegetables (this writer has grown tomatoes, basil, sunflowers, mint, lettuce and carrots), and where a cherry tree, a fig tree and a grapevine grace the common areas. The late Mr. Dullea was a horticulturist who originally came from the Midwest. A former co-op president, he wanted to give kids who grew up in the city - as well as adults who missed gardening - the same opportunity to enjoy this outdoor activity that he had been given.

"We're probably unique," says Goldstein. "We make an effort to provide all kind of services "¦ we see ourselves as a community with a interest in improving our quality of life."

Penn South also sponsors a credit union that offers low-interest loans. According to Goldstein, "Many cooperators financed their equity payments with loans from the credit unions." At one time, the co-op sponsored its own supermarket as well, but it has been replaced by several chain supermarkets, most recently Gristede's.

Supporting Seniority

Separate from these co-op sponsored activities, yet closely related, is the organization known as Penn South Program for Seniors. The program, Smith recalls, was the first senior center established under the NORC program in 1986. It had become clear that the co-op's population was aging and the seniors' needs presented a new set of challenges. Today, the organization has a staff of social workers and other professionals and sponsors a wide array of activities. Offerings listed in the October 2004 newsletter include a poetry workshop, a watercolor/still-life painting workshop, a chair exercise session, a lecture on opera, tai chi, yoga and a choral sing-along.

All in all, says Mankoff, the program gets about $280,000 in government funding each year for senior support services, "and the co-op also puts in a sizeable chunk of aid."

One important service of the program is to help seniors stay active and get back on their feet again after an illness or a personal setback. One example concerns a recent widow, who had become frail and had few relatives to care for her. She began withdrawing socially, and over the course of several weeks, her apartment was not cleaned and her clothes went unwashed. A neighbor referred her to Penn South Seniors, where a social worker from the group hired an aide, who helped the woman with the housecleaning and cooking that she was no longer able to manage on her own. The organization also provided a walker and a wheelchair to get the woman out of the house, thus encouraging her to start going again to meeting of the groups that she once belonged to. In a short time, the woman was back interacting with friends and neighbors and part of the community once again.

Raanan Geberer is a freelance reporter and writer, and a resident of Penn South in Manhattan.

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  • I have been living in Penn South since 2002. I work and two meetings were made for Penn South's capital improvement project set to begin in July. My problem with these two crucial meetings is that I worked two shifts each and every time meetings were announced for this major capital improvement project. Management should have given the tenants unable to attend the option of obtaining a video or DVD for a fee to see the full scope and implications involved with this project. Does the tenant whose turn arrives to get their apartment cleared of old pipes and asbestos need to vacate for a week or more? What happens to the affected tenant without any relatives or friends nearby? Where does this kind of affected tenant go to in the midst of these huge challenges while the tenant needs to work? How will this affect me with my job? I feel numerous uncertainties and need certain answers with questions made here.
  • Francesca Ciolino-Volano on Wednesday, January 26, 2011 2:48 PM
    My mother worked as a dress operator and is still a member of the ILGWU. She receives a pension from the ILGWU. As her daughter, how can I get on a coop list or get any further information about doing so?
  • MaryAnn Bavuso on Thursday, June 16, 2011 5:16 PM
    My dad was a tailor in the garment district of ny city. he worked for the LIGWU from age 16 or 17 until he retired in 1977. he died soon after that. as his daughter would i be elegible to be placed on the co op list. my mom also worked as a seamstress for many yrs.
  • I dont know why I was singled out for an investigation into the coop being my primary residence. Although my job takes me on the road from time to time I am very much a primary resident as demonstrated by a great number of proofs I've submitted to our manager. I'v never subleted or had many guests. Why was I singled out when there are people on my floor who never show up? There are also others who spend much of their time in Florida and only come up for the summer months. Can someone help me.
  • Interested in finding out about getting on your l ist for a one or two bedroom apartment
  • My wife and I are approaching retirement age and are interested in finding out the requirements for applying for an apartment at Mutual Redevelopment Houses.
  • I looked at nine one bedrooms recently at One Penn and they were priced between $67-87,000. If you were interested, it was required to pay 50% of the equity as a downpayment just to get started. How does that make Penn South a "liberal" minded housing complex?
  • I would like information on getting on the waiting lists. Although the prices seem to have gone up.
  • i would like to retirer at penn south can i be put on the waiting listh
  • Why is Penn South liberal-minded even though apartments now cost $67,000? Because market value of those apartments in Chelsea is around a million dollars. Penn South apartments go for 10% or less of their market value and must be resold back to the co-op at that price. Waiting list is closed at 20,000+ people and has not been open for years. Being a garment worker or child of a garment worker has zero impact on getting on the list. If the list opens an ad will be put in the newsletter. Last time the list opened was about 15 years ago. It takes 15 to 20 years to be offered an apartment once on the list. You must be an NYC resident who earns a "middle income", not too low nor too high.
  • I would like to know how I can get on the waiting list for an apartment.
  • Prices are now up to at least $100,000 for a one bedroom apt.
  • I grew up at Penn South in building 7 and I long to move back. I wish my father had psssed it on to me as he had promised. if anyone can tell me how to get back on the list I would be greatly appreciative.
  • Why after several attempts with lottery number 2003-0000222H has my request to find out the status of my application and position on the waiting list been ignored? I have sent them in by mail and no response has been forthcoming. I find this to be terribly frustrating. Thank you.
  • What should I do to be put on the waiting list for Penn South studio?��brgds, Grace.
  • I would like to know the process of applying to get on the waiting list and how long is the wait per apartment size? Thank you.
  • Would like info on how to get on waiting list. My family's apartment was demolished in the late 50's to make room for these buildings.My parents were offered a chance to buy but declined at that time. Would love to go back!
  • The only long term solution to affordable housing: perpetual non-profit land trusts where the trusts own all the property and lease them out. Leases could be mixed, with some leased for 99 years renewable (with adjustments in the lease price) designed to be multi-generational. Other leases could be of varied shorter durations, but all renewable. Subsidizing the land trust would take a number of forms. One would be using 20% of the land for market rate apartment buildings. Another would be building up an endowment the way universities do, with an emphasis on taking donations from non-residents. Another would be higher but still reasonable rents for the shops and businesses operating on the land trust. P.S. The idea for the 99 year renewable lease came from my parents history. Both came from Catholic families with rare 99 year renewable leases, with all capital improvements owned by the tenant and sellable if the tenants decided to move out. Tenants with these leases under British law were given the status of owners when property ownership was required for voting. As a result of these leases, my parents electoral district, in an overwhelming Catholic country, was the only district with Catholics as the majority. My parents' families were able to innovate in how they farmed and grow prosperous even as tenant farmers.
  • Due to family emergency I moved from Penn South to Buffalo N.Y. in 2003 I would like to know how I can get on the list for a 1 bedroom apartment in the development. I would greatly appreciate any info that can be sent to me.
  • Reside at Penn South and it is a bastion of cronyism. The management office employees including the prior manager held positions on the board of the Penn South Credit Union. The president and other board members of the credit union are now presidents and senior members of the coop board which is suppose to represent the residents. Their only interest is to maintain their decades long cronyism. This has shown a lack of transparency, violations of fiduciary duty, conflict of interest. The president and senior board members who have supported this should be stepping down from the board since the credit union does business with the management office in the form of providing mortgages, financial transactions. That is why the management office treats cooperators badly, and rule against them with impunity. The president and senior board members support them as they have this relationship/interest with each other. One management office employee even changed their last name to throw people off and was on the board of credit union board of directors. I only found out because there was a lawsuit with that person's name and had an aka which was the name on the credit union board members on their website. Another year the same person was on credit union website board listing with their real name. So they not only interchange management office employees, but they interchange names to pull the wool over the eyes of the residents of Penn South and realize there is now not one hispanic or black member on the board and in order for any to run there would have to be a major board cleansing.
  • Penn South is not leasing parts of their land for 99 years to private developers. So much for claiming to be an affordable housing cooperative.
  • I would like to ask if the penn south neighbourhood is 10 buildings or 15, thanks for letting me know!