New York State’s highest court has ruled that East Midtown Plaza will remain affordable, ending years of feuding between residents over whether the six-building co-op complex should get privatized, Real Estate Weekly reported.
The 746-unit complex, between First and Second Avenues and 23rd and 25th Streets, is covered under the Mitchell-Lama Law, which sets limits on apartment sale prices. A group of residents—dubbed the “privateers”—wanted to take the co-ops private to turn a profit on their unit sales and to bring in income for the property from increased flip taxes. Another group—the “antis”—wanted to maintain the complex as affordable housing for the area.
A 2009 vote ended in a stalemate when both sides claimed they won a majority. If votes were counted on a per unit basis, the anti-privatization group would have won, but if votes were counted by co-op shares, the pro-privatization group would have won. The dispute wound up in court.
A unanimous Court of Appeals panel sided with the anti-privatization group, upholding decisions from two lower courts. “East Midtown Plaza’s certificate of incorporation specifies that each shareholder is entitled to one vote at shareholder meetings, regardless of the number of shares owned,” the court ruled.
Jeanne Poindexter, who led the anti-privatization charge, paid $4,250 for her co-op in 1974; today, it could be transferred for a maximum of $20,000, she said. [REW]—Leigh Kamping-Carder