The Real Deal New York

Court denies Apthorp rent increase for upgrades

April 19, 2010 07:11PM
By David Jones

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Lev Leviev, head of Africa Israel, and the Apthorp

A state Supreme Court judge ruled Monday against the owners of the famed Apthorp condominium on the Upper West Side, blocking a proposed monthly rent increase of about $37 per apartment.

The owners wanted to overturn an earlier denial by the state Division of Housing and Community Renewal of their effort to recoup $2.9 million in capital improvements with the hike.

Judge Alice Schlesinger ruled that the ownership group, led by Africa Israel Corp. and Mann Realty Associates, failed to provide evidence that new electrical wiring in the 163-unit building had been properly installed and documented.

The case stemmed from a so-called major capital improvements, or MCI, request from the building’s previous ownership.

“The tenants won a well-deserved victory when Judge Schlesinger correctly upheld the DHCR denial of the electrical MCI because of the owner’s failure to provide DHCR with the required documentation,” said attorney David Hershey-Webb, who represented the tenants.

Daniel Roskoff, an attorney for the owners, was not immediately available for comment.

The MCI dispute was part of a wider struggle between the owners and tenants at the Apthorp, at 390 West End Avenue, which is undergoing one of the most controversial condominium conversions in New York City history.

Mann and Israeli billionaire Lev Leviev led a $426 million acquisition of the Apthorp more than three years ago, and have been working to convert the property into luxury condominiums.

In early 2009, Leviev wrested operational control from Mann and brought in the Feil Organization to take over management of the property.

Tenants complained last year about dust and other conditions related to renovation work at the building, alleging the developers are trying to harass the remaining tenants out of their apartments to make the building more attractive to condominium investors.

City Council member Gale Brewer said a number of city, state and federal health and safety agencies, including the Occupational Health and Safety Administration, have been brought in to monitor the building amid complaints about asbestos dust, working conditions and other issues.

“On all levels this particular owner is not following the rules, I would say,” said Brewer. “We’ve had nothing but problems ever since those owners have come in.”

The state Attorney General has been reviewing the final phase of the offering plan amid allegations that inside investors have been used to gain approval for the conversion. The landlord submitted final documentation for the conversion in September, and the AG’s office has been reviewing the application since to make sure the newly signed buyers are not family or businesses associates of the developers.

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