There was a public hearing today regarding the sale of a 406,000-square-foot parcel in East New York, Brooklyn to the Related Companies, which plans to bring a Walmart to the site, Crain’s reported (note: clarification appended). Previous attempts to open Walmart in Staten Island and Queens have been rebuked by the retailer’s opponents, but having seen the success of similar businesses such as Target and Ikea, Walmart renewed its efforts to come to New York by opening discussions with Related. Related settled on the East New York parcel, and agreed to pay $35 million for the site, which was appraised at $30.5 million. [more]
Posts Tagged ‘department of housing preservation and development’
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New York housing officials have identified 200 buildings they say are the most poorly maintained in the city, racking up more than 20,000 hazardous violations for issues including mold, vermin and heating, the Wall Street Journal reported. Brooklyn had the highest total, with 99 buildings, while the Bronx had 70 and Manhattan only had 23. “For the families who call these terrible 200 buildings home, the conditions pose a real threat to health and safety — not only to the tenants, but to the neighborhood as a whole,” Rafael Cestero, commissioner of the city’s Department of Housing Preservation and Development, said in a statement. [more]
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Rafael Cestero, the commissioner of the city’s Department of Housing Preservation and Development, will be leaving his position to pursue an opportunity in the private sector. During his five years at HPD, Cestero “put his unique brand of innovation and pragmatism to work in advancing our mission to strengthen our neighborhoods and create a more affordable and sustainable city for all New Yorkers,” said Mayor Michael Bloomberg. He added that Cestero was involved in the development of the New Housing Marketplace Plan to create 165,000 affordable housing units by 2014. TRD [more]
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Bedbugs are here to stay, at least for now, statistics from the city’s Department of Housing, Preservation and Development show. Residential bedbug complaints in New York City climbed 7 percent during 2010, the Wall Street Journal reported. In 2010, there were 4,846 violations and 13,472 complaints, up from 4,811 and 12,594 in 2009. According to Louis Sorkin, an entomologist with the American Museum of Natural History, there are many more infestations than complaints. “Tons of people that have infestations don’t say anything and, if they are in apartments, the people next door are the ones with a complaint finally,” he told the Journal. [more]
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Despite a boom in affordable housing in the city, wheelchair-bound Monique Holloway says she still hasn’t found an apartment after months of searching, mainly because she’s been placed on a blacklist of would-be tenants who developers reject because of an old housing court case on their record. According to DNAinfo, Holloway, 42, said she found out she was on the blacklist last summer, when she applied to live in the Tapestry Apartments on 124th Street in East Harlem. Even after a judge dismissed her case, she still has not been able to convince the developer, C&C Management, to remove her from the blacklist. “I feel like it’s discrimination,” she said. [more]
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Ailing Anglo Irish Bank underwrote hundreds of millions of dollars in real estate debt in New York during
the boom and is now unloading a $51.5 million mortgage secured by a package of apartment buildings
in Upper Manhattan, owned by Vantage Properties.Anglo Irish, based in Dublin, is in financial distress after billions of dollars in global real estate loans went
bad. Ireland’s central bank reported last month that the bank, which provided financing for projects
such as the Apthorp and 225 Rector Street, is winding down operations. A
representative of the New York office said the bank declined to comment.The Vantage Properties loan is being marketed by investment sales firm Massey Knakal Realty Services.
Company CEO Robert Knakal declined to comment on the offering, but said in this week’s edition of
Insights from The Real Deal that currently demand for note sales is higher than for actual properties (see
video above).The Vantage loan was being offered for the face value of the unpaid balance of the loan. Marketing
materials distributed earlier this month by Massey Knakal, and obtained by The Real Deal, said the note
was performing as of November.The sale of the note highlights the wide variety of loans that are on the market and the complexity of
selling them. Loan sales now make up an ever growing proportion of commercial transactions, yet the
market remains shrouded in secrecy because note sales are rarely recorded in government records and
both the lenders and borrowers often don’t want the offering made public because acknowledging a
property is in distress can further reduce values.The 474-unit Vantage Properties note, secured by buildings such as 90 Ellwood Street in Fort George and
248 Sherman Avenue in Inwood, has 414 rent-stabilized units and estimated annual gross revenue of
$5.5 million, the marketing materials say.Neil Rubler, president and CEO of Vantage Properties, declined to comment via e-mail, but added
that, “I also can’t comment on our interest in buying the note, as it’s our policy not to discuss acquisition
efforts.”Massey Knakal is active in the Bronx as well, marketing two purchase options on notes for major
properties there. The firm is offering an option to buy the $36.5 million note secured by two buildings
with 490 units — Robert Fulton Terrace at 530-540 East 169th Street in Morrisania and Fordham
Towers at 480 East 188th Street in Belmont. Those properties, purchased by a group of investors led by
Mark Karasick in 2007, are
being foreclosed on by special servicer LNR Partners.The other Bronx asset is a $35 million loan in foreclosure controlled by LNR, that is secured by 10
buildings owned by Milbank Real Estate.The Milbank portfolio has attracted particular scrutiny from the city and housing advocates who believe
the loan is too high for the 531-unit property, which has estimated gross revenues of $5.9 million for
2010, the marketing materials say. The properties are plagued by housing code violations, with a total of
4,372 in the 10 properties, city officials said.In fact, today Department of Housing Preservation and Development Commissioner Raphael Cestero
announced subpoenas to order executives of Milbank and LNR Partners to appear at HPD’s offices in
January to discuss the Bronx properties.Knakal, in his interview with Insights from The Real Deal conducted before the subpoena was
announced, said owners were not deterred by housing advocates.“Buyers have to have a lot of intestinal fortitude to deal with properties that have rent-regulated
tenants in them from the beginning, so a little bit of pressure from housing advocates doesn’t really
dissuade investors,” he said.Knakal said activity on note sales was high.
“I would say on the notes we have sold this year, where the collateral has been Manhattan-based
properties, we have gotten a minimum of 50 offers,” he said.Harold Shultz, senior fellow at the non-profit research center Citizens Housing and Planning Council, said
lenders and special servicers in many cases have been reluctant to sell notes, because they have to mark
down their value.“But presumably they can’t hold on to them forever. Perhaps this is the beginning of the big sell off,” he
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With mounting numbers of buildings in foreclosure and others in disrepair, city officials and housing advocates say that corrupt investors are trying to purchase these buildings, often clashing with tenants, the New York Times reported. Rafael Cestero, the commissioner of the city’s Department of Housing Preservation and Development, said he had seen a number of distressed properties sold to buyers who were not acting “in the best interests of the city, the neighborhood or tenants.” City officials, seeking ways to intervene, are often virtually powerless, since most of the deals are private. “This is probably the most difficult thing we’re doing at HPD right now,” Cestero said. While the buyers are often paying less than the previous owners, tenant advocates maintain that prices are still too high for the amount of rental income the buildings generate and the repairs they need. So the new owners, advocates say, have already revived old tactics of tenant harassment, including bringing trumped-up lawsuits against tenants in rent-regulated apartments, hoping to evict them, and then raising the rent under the state’s so-called vacancy decontrol rules. [NYT]
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Around 442 residential buildings across the city are in serious
default on property taxes, according to the New York Times, as a result
of recession-related fiscal challenges, including unemployed tenants
unable to make rent payments. The rise of delinquent mortgages among
multi-family properties underscores the simultaneous climb of blighted
buildings in the city, experts say, with necessary maintenance often
falling by the wayside when financial times get tough. Douglas Apple,
first deputy commissioner of the Department of Housing Preservation and
Development, said that the rise of delinquent mortgages, largely
localized to the South Bronx, Harlem and central Brooklyn, is alarming.
“More and more of these properties, especially the not-for-profits, are
not making their mortgages, not paying taxes, water,” Apple said. “It’s
gotten to the point where we are very concerned.” [NYT] -
The city wants to crack down on the longtime practice of illegal boarding houses for the formerly homeless, where for years landlords have been charging down-on-their-luck tenants hundreds of dollars a month for a bunk bed in a run-down house. There are dozens of these kinds of illegal boarding houses, according to the city, concentrated in poor neighborhoods in Brooklyn and the Bronx. Many are overcrowded, with as many as 60 people living in a two-family home. Yesterday, the city took a decisive step in putting an end to these operations by ordering the Department of Homeless Services and staff members in non-profit shelters to stop referring homeless people to buildings that have been cited as unsafe in city inspections. Shelters that break the rules will be issued fines.
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Hotel developer Sam Chang and 440 West 41st Street (building photo source: PropertyShark)Hotel developer Sam Chang sold a 13-story Hell’s Kitchen building being operated quietly as a hotel to Israeli investors as part of a complex deal in which Hersha Hospitality Trust took title to a Chang hotel in Tribeca and wiped out nearly $20 million of his development loans.
Chang’s H Forty First Street LLC, sold the Hell’s Kitchen property at 440 West 41st Street for $17.5 million to a company owned by Israeli investors called US Suite on March 5, city property records published Monday show.
Although Chang sold the property March 5, he signed a sales contract Dec. 15 and ceded operations to US Suite on Dec. 22, when he signed over a net lease on the property, city records show. [more]
