Proposal to subpoena building data from lenders, special servicers stirs controversy
Riverton Houses in Harlem
From the July issue:
Housing advocates are calling on the city to use its investigative
powers to obtain financial records from lenders and then influence
sales at overleveraged multifamily buildings. The advocacy groups
believe the city’s Department of Housing Preservation and Development
can use proprietary information from banks and servicers of troubled
loans to direct sales of distressed properties to buyers who will
maintain them as rent-regulated properties. Not surprisingly, landlords
say the proposal could do far more harm than good. One housing
advocate, who asked to remain anonymous because negotiations are
ongoing with the city, said HPD could challenge lenders who want to
sell properties or notes for prices that cannot be supported by rent
rolls. “HPD presumably says, ‘If you sell at that price, there is never
going to be enough money available to maintain the building,’” the
source said. [more]
