Affordable Housing Institute : US

What does the unassuming stack washer-dryer have to do with global economist Hernando de Soto, or the vexing problem of American illegal immigrants?

 

Are you talking about meek little me?

 

Big concepts are sometimes demonstrated in tiny actions, fundamental principles exposed by mundane practicalities.

 

An everyday convenience just about everywhere else is a rarity in Manhattan, even in million-dollar apartments: the washer-dryer.

 

So pervasive is the laundromat in everyone’s young adulthood that it might serve as a symbol for being single: the pillowcase full of dirty clothing, the ka-chunk as multiple quarters slot home, the late-night hypnosis of spin-dry cycle, the sizzling-finger fold.

 

No Daniel Day-Lewis for you, young man.

 

The washer-dryer becomes the talisman of arrival, a small luxury of homeownership. As the New York Times tells it:

Danielle S. Sevier, a broker at JC DeNiro, is still giddy after adding a washer-dryer to her West Village apartment a year ago. For her the washer-dryer has been a rite of passage. “You’re not really grown up until you have your own washer-dryer,” she said.

 

SAVING HER QUARTERS

 

Danielle S. Sevier is a lucky Manhattan resident: she has a washer-dryer in the bathroom.

Except one place in America: the birthplace of apartments, the co-op’s redoubt.

 

 

In New York, the hunger for private laundry facilities is an old story fueled by nervous co-op and condo boards, which often ban washer-dryers for fear of overwhelming their buildings’ aging plumbing.

In Manhattan, almost any pleasure, privilege or convenience can be conjured for a price. But for apartment dwellers, few things pierce the fantasy of entitlement — or level the urban-suburban playing field — so swiftly as the denial of a humble household amenity known as the washer-dryer.

 

It’s not a few who have to take the elevator down to the dreary basement, but most Manhattanites:

As of the end of March, only 17% of the active listings indicated that washer-dryers were allowed, according to Miller Samuel, a Manhattan appraisal firm.

The situation is even bleaker for rentals: only about 5% allow washer-dryers, according to Gordon Golub, a senior managing director at Citi Habitats. The laundry-endowed rentals, which command a 10% to 15% premium, are typically limited to newer buildings in areas like Battery Park City and the West 30’s and 40’s. But Mr. Golub said that washer-dryers can sometimes be found in family-size prewar rentals.

 

Until recently, the absence of personal washing space was an affliction to be silently borne:

“I think a lot of people put up with it when there weren’t as many other options,” said Alan Kersh, a 46-year-old investment banker who is working with Bruce Roland of Bellmarc to find a three- or four-bedroom apartment in the $2.5 million range on the Upper East Side.

 

But how you gonna keep ‘em down in the basement, when they’ve seen nouveau riche?

At the same time, the proliferation of the appliances in nouveaux condos is making restrictions in older buildings less palatable, particularly among buyers who can afford to choose.

 

You eat of the fruits of the Tree of Washing and Drying, you get evicted.

 

Why are washer-dryers so prized, so rare? They are incompatible with an aging and thus functionally obsolescent physical stock:

“The biggest issue is sudsing,” not flooding, said Paul J. Herman, an executive vice president and the director of management at Brown Harris Stevens Residential Management. He said that soap suds can back up through the drains of lower-floor apartments from washers in use on higher floors.

 

“Do we have a problem here?”

Introducing that newfangled contraption thus means some cost, some risk. This leads to a variant of the ‘public choice’ risk:

 

Public Choice Theory

Although people acting in the political marketplace have some concern for others, their main motive — whether they are voters, politicians, lobbyists, or bureaucrats — is their own self-interest.

 

The co-op’s board members may be less concerned with their fiduciary duty and more worried about their personal risk.

There are several reasons that co-op and condo boards may be loath to do so. Their members are volunteers, after all,

Paid not in money but in power, and in any case, subject to the same duties.

 

I want you to do your fiduciary duty.

 

and they may be reluctant to invest time and energy in a process that could favor some owners over others, or to approve anything that may result in liability.

Even though undertaking a washer-dryer retrofit is very likely in the building’s long-term best interest, an individual board member has a short-term incentive to deflect the necessity for action. Given this, it’s a poor board member who can’t find a report behind which to hide:

 

We’re covered by the engineering report.

 

They have a ready excuse in the form of engineers’ reports and in managing agents who counsel them to err on the conservative side.

Then too, under any procedural toll bridge lurks an economic troll profiting from the present state of affairs:

In some cases, a building may have a direct monetary incentive to refuse permission: the vendors who run laundry rooms will often pay higher rent in a building that prohibits individual washer-dryers. The prohibition may even be written into the contract.

 

I thrive on sub rosa agreements.

 

The status quo, though less than optimal, is therefore sustained by a self-organizing symbiosis among:

1. Obsolescent buildings where the improvement is very expensive.

2. Board members for whom the easy word to say is No.

3. Beneficiaries (laundry companies) who extract a premium from the market failure.

4. Individuals (superintendents) who can make a little vigorish by abetting evasion.

The four of us are a symbiotic team

What breaks the cartel? Two things: rising expectations driven by market pressure, and the existence of choice.

A homeowner who pays a market-plus price expects a market-competitive home.

 

“I get this all the time,” said Daniela Kunen, a managing director at Prudential Douglas Elliman. “People feel when they’re spending millions of dollars, they want a washer-dryer, and they should have it. They feel deprived of a basic need that they would be getting anywhere else.”

In this, New York City is competing not just within Manhattan, nor even the outer boroughs, but also against other cities. Everywhere else in America, a washer-dryer is included with an owned home. Immigrant customers — those who move to New York for their career — are more demanding than worn-down locals. Even so, they can be browbeaten into sullen acceptance until the second shoe drops: choice appears.

 

Simply demonstrating the existence of an alternative destabilizes consumer expectations.

Washer-dryer units — typically stackable and often ventless, which can require emptying trays of condensed water from the dryer — are routine in most new construction. “If you don’t put in a washer-dryer, you have to do a big laundry room, and I think the laundry room has a connotation of an old 60’s concept,” said Veronica W. Hackett, a co-founder of the Clarett Group, a developer whose properties include Chelsea House at 130 West 19th Street and Sky House at 11 East 29th Street.

 

Doesn’t that look like fun?

At the same time, the proliferation of the appliances in nouveaux condos is making restrictions in older buildings less palatable, particularly among buyers who can afford to choose.

Faced with this absurd denial of an amenity the hoi polloi take for granted, what do New York’s airy elites do?

[Continued tomorrow in Part 2.]

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