Brooklyn real estate developer David Bistricer of Clipper Equity has been added to Public Advocate Bill de Blasio’s watch list of slumlords. Bistricer’s Flatbush Gardens, a 30-acre, 59-building complex in East Flatbush has 6,475 open code violations, with 827 of them for serious threats to health or safety. “The landlord is clearly trying to change the nature of the development and make it more appealing to upper-income tenants,” de Blasio told the Daily News. “This may be a landlord who purposely wants to reduce the level of service to encourage… tenants to leave.” During a tour, the Daily News spotted raw sewage collecting in a graffiti-covered basement, broken locks, shattered windows and exposed wiring. Several tenants complained of mice and roach infestations as well ceilings collapsing from water damage.

Richard Rubenstein, a spokesperson for Bistricer, who led the group of investors that bought the complex in 2005 for $138.5 million, said the owners have addressed and removed over 5,000 violations and that they intend to meet with de Blasio to do what it takes to get off the slumlord list. The conditions at Flatbush Gardens — formerly known as Vanderveer Estates — were one factor federal officials cited when they rejected Clipper Equity’s $1.3 million bid for the 46-building Starrett City complex in 2007. They also cited a 1998 court order banning Bistricer from selling condos in New York because of financial irregularities. [NYDN]

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The Riverton Houses and Larry Gluck

The new owners of the rent-stabilized Riverton Houses in Harlem that sold at auction yesterday will have to pay a hefty transfer tax of just under $4 million after they take title to the property in the next couple of days, real estate experts said. Financial firm CWCapital Asset Management, the special servicer for the loan on the 1,228-unit complex between 135th and 138th streets and Fifth Avenue and Harlem River Drive, won the property at an auction yesterday with a bid of $125 million. Since it was representing the commercial mortgage trust that held the Riverton loan, it effectively put the foreclosed property back into the hands of the lender. Tom Fink, senior vice president of Trepp, which tracks mortgage-based securities, estimated the tax liability to be $3.8 million. [more]

Riverton Houses, Steven Sinatra (top) of Greenberg Traurig, and Howard Comet (bottom) of Weil, Gotshal & Manges

Update (1:50 p.m.): David Bistricer’s Morgan Capital was the other bidder. Comments regarding and from Bistricer added.

Special servicer CWCapital Asset Management won the bidding this
morning to take title to the Riverton Houses in Harlem at a price of
$125 million, following a short bidding war with an attorney
representing a company controlled by real estate investor David Bistricer, called Morgan Capital. About 75 people, including brokers, potential buyers and residents of
the 12 13-story apartment buildings, attended the brief auction in the rotunda of the State Supreme Court building at 60 Centre Street. The property has a loan with a judgment valued at $240.6 million that is held in a
commercial mortgaged-backed security. CWCapital is the special servicer
for the loan.
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