A federal judge just handed a major legal defeat to New York City Mayor Zohran Mamdani in his effort to interfere in the sale of thousands of rent-stabilized rental properties in the Big Apple. Mamdani, who is only a few weeks into his role as mayor, attempted to pump the brakes on the sale of the properties after tenants issued complaints about Pinnacle Group, the seller of the properties, alleging that they poorly maintained the properties.
The tenants also shared concerns that the new prospective buyer, Summit Properties USA, would engage in the same kind of behavior. Mamdani’s basis for running interference was that the city of New York was a creditor to Pinnacle. The company allegedly owes the city $12 million in unpaid fines. However, Bankruptcy Judge David Jones shot down the new administration’s effort.
Jones could approve the sale to Summit in the next few days, however, Mamdani and his team are not ready to throw in the towel just yet, stating they are now pursuing other options. “We will continue to fight to ensure any owner of this portfolio makes necessary repairs to bring the buildings up to code and respects the rent stabilization regulations,” Leila Bozorg, the city’s deputy mayor for housing, said.
A report from Fox News revealed that Mamdani’s latest courtroom loss comes after another big controversy that rained on his administration’s housing agenda, the hiring of Cea Weaver to head up the Office to Protect Tenants. Weaver made comments in the past about home ownership being a “weapon of white supremacy,” making the case that property should be treated as a “collective good.”
As the comments came back to haunt her, Weaver has stated that she regrets making “some” of her past comments, however, she did not specify which ones she meant. She then stated that she’s planning to tackle “racial inequalities” while serving in her new position. “But, you know, I do think my decades of experience fighting for more affordable housing sort of stands on its own,” Weaver explained.
She continued, “I’m proud to be in this role fighting for stronger tenants’ rights. And I think that for many years, people have been locked out of the property market, that has produced systemic and racial inequalities in our system.” She then added, “I want to make sure that everybody has a safe and affordable place to live — whether they rent or own,” she continued. “And that is something that I’m laser-focused on in this new role.”
Pinnacle Group is owned by billionaire Joel Wiener and is considered one of the largest landlords in the New York City area. The company owns 140 buildings and 9,000 apartments. According to The Center Square, not long after Pinnacle filed for bankruptcy last year, Summit Real Estate Holdings made an offer of $450 million to buy dozens of buildings located in the Brooklyn, Manhattan, Bronx, and Queens. Before the deal can move forward, Judge Jones must give it his approval.
"*" indicates required fields
“Completion of the bankruptcy auction process will bring financial stability along with the opportunity to stabilize services, outcomes which we would expect the City would not want to disrupt,” Pinnacle lawyer Ken Fisher went on to say in a recent statement concerning the sale.
Featured Image: Bingjiefu He, CC BY-SA 4.0 <https://creativecommons.org/licenses/by-sa/4.0>, via Wikimedia Commons