With OTBs closed, landlords left in the cold

Landlords across the city had expected a steady income from renting their large storefronts to the city's Off-Track Betting Corp. But now that the gaming agency suddenly shuttered last month, odds are the tens of thousand of dollars lost in back rent will never be recouped.

"They never even notified us they were closing. Who does that?" griped Anthony Guarino, whose family owns a 4,000-square-foot property on Avenue X in Gravesend, Brooklyn, where OTB had operated a horse-betting parlor since the 1970s.

Since the city OTB went bust in December, the state has failed to pay the nearly $30,000 owed for two months' rent, said Guarino, who was forced to haul the OTB equipment from his property recently in the hopes of luring new tenants.

He's not alone in his troubles, as many of the 54 former OTB parlors across the city remain empty and boarded up as landlords try to reach out to the state for payment but fail to get any response.

"The way they exited was disgusting," said Lance Steinberg, whose company owns property on Delancey Street in the Lower East Side, where December rent on an OTB parlor has also not been paid.

The NYC OTB was set up in 1970 as a public-benefit corporation, whose revenue from horse wagering - about $1 billion a year in bets - provided funds to the state, the city and the horse racing industry. Gamblers could watch races in off-track parlors, some in gritty, one-room commercial spaces.

But the State Legislature demanded more of the OTB's revenue during the 2000s, which the corporation said contributed to its financial demise. The state took it over in 2008, and the money-losing venture filed for bankruptcy the following year. OTB's end came last month when lawmakers were unable to agree on a bailout plan.

John Van Lindt, former vice president of NYC OTB, said the bankruptcy has yet to be resolved, but since the bookmaking agency has no significant assets, there's no real recourse for landlords owed rent.

Repeated calls to the governor's office were not returned.

While some legislators are calling for OTB to be revived as a privately operated business, frustrated landlords are trying to figure out how to find new tenants. Realtors say the defunct parlors in high-profile neighborhoods, particularly in Manhattan, may fare better, while others in the outer boroughs may face a chilly rental market.

"In this economy, I don't see anybody trying to call me or ring my bell," Guarino said.

A big numbers look at the NYC OTB troubles:

$600 million: Its debt the state must cover, including cost of health care and employee pensions

$67 million: Amount it owes creditors

800: Jobs lost after parlors were closed