Dune Real Estate Partners has purchased the loan for a portfolio of 36 apartment houses on the Upper West Side for close to $105.1 million — a 45 percent discount — Crain’s reported. According to numbers provided by real estate analytics firm Trepp, the loan is valued at $192.1 million. The buildings concerned, which house a total of 1,083 units, were bought by controversial landlord the Pinnacle Group with the Praedium Group during the real estate boom. Pinnacle alone was thought to have purchased $1 billion in distressed buildings in Upper Manhattan and parts of the Bronx between 2004 and 2006, coming under extensive criticism for attempts to hike rents after fudging capital improvements. [more]

Delinquency uptick driven by Pinnacle-Praedium default on Upper West Side

The volume of seriously impaired CMBS loans in New York City grew by 3.8 percent last month after a portfolio of 1,083 Upper West Side apartments co-owned by Pinnacle Group and private equity partner the Praedium Group slipped further into delinquency, according to October data from Trepp compiled for The Real Deal. The data includes CMBS loans backed by New York City properties whose payments are more than 60 days overdue. The Pinnacle-Praedium delinquency — the fourth-largest of 49 such loans in the city — was solely responsible for the increase, which put the city’s total volume of loans more than 60 days delinquent at $4.9 billion (see the full list of seriously delinquent New York City CMBS loans after the jump).

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AG Andrew Cuomo

Attorney General Andrew Cuomo announced a settlement today with Pinnacle Security Group, a Utah-based company that used deceptive door-to-door sales tactics to trick close to 4,000 New York homeowners into signing contracts for unnecessary services. The attorney general’s investigation revealed that Pinnacle’s door-to-door sales staff often targeted homeowners who had existing contracts with other security companies. In a deceptive practice known as “slamming,” Pinnacle made false representations to convince people to sign up for their products even though the consumer had a contract with another home security company. Pinnacle misled homeowners into believing that their existing home
security provider had gone out of business, had merged with Pinnacle or was in some way already affiliated with Pinnacle. Homeowners were then stuck paying for redundant monthly services from two security companies, including upwards of $50 per month for Pinnacle. Those who tried to void the contract were faced with cancellation fees. The settlement requires Pinnacle to provide full compensation to all New York consumers who signed up with the company since January 2008 and were subject to deceptive sales practices. The company must also pay a $150,000 penalty and reform its sales practices. TRD

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A class-action lawsuit that accuses controversial landlord Pinnacle Group NY and its CEO, Joel Wiener, of harassing rent-regulated tenants and evading New York’s rent regulation laws has been certified to proceed in federal district court, Crain’s reported. Pinnacle, which controls or owns more than 400 apartment buildings throughout the city, was also accused of violating the federal racketeering statute, RICO, and the New York Consumer Protection Act. An attorney for Pinnacle called the allegations “baseless” and said the company plans to appeal. [more]

From left: New York Attorney General Andrew Cuomo and Neil Rubler, president and CEO of Vantage Properties

New York Attorney General Andrew Cuomo announced today that he would
sue Vantage Properties, one of the largest landlords of rent-regulated
housing in New York City, for allegedly harassing tenants. Cuomo said in a statement that he would sue to halt the alleged
harassment and seek monetary damages to tenants who were victimized. “[Vantage's] underhanded tactics displace long-time residents from
their homes and exacerbate the acute affordable housing shortage,”
Cuomo said in a statement. This is not the first time the office of the New York attorney general
has put pressure on a large city landlord. In December 2006, the office
of then Attorney General Eliot Spitzer hammered out an agreement with
Pinnacle Group, a landlord that was strongly criticized for evictions
and rent charges. The allegations against Vantage, headed by Neil Rubler, include trying
to evict tenants with claims that the apartment is not their primary
residence, and suing tenants in housing court for non-payment despite
receiving rent payments in cash. [more]