The Real Deal New York

Council introduces new law to govern deed removals

Brewer says city "screwed up" in Rivington House scandal
December 22, 2016 05:15PM

Gale Brewer and Rivington House

The City Council signed a new bill into law that will require mayors to personally approve changes to city-imposed deed restrictions.

The new legislation, sponsored by Manhattan Borough President Gale Brewer and Council member Margaret Chin, is aimed at preventing another Rivington House scandal, according to a statement from Brewer.

Under the new law, three separate entities — the Department of Citywide Administrative Services, a specially formed committee and the mayor — will need to review requests for a deed change or restriction. The city will also create an online database of any properties with deed restrictions. Under previous laws, the administrative agency can lift deed restrictions in exchange for a fee, with approval from the mayor’s office of contract services, but not necessarily the mayor.

“Our city government failed us when it did not protect Rivington House. When government screws up, it’s our first job to figure out why and make sure it cannot happen again,” said Brewer.

In the Rivington House scandal, Allure Group  paid the city $16.1 million to lift the deed restriction on a nursing home at 45 Rivington Street. The company was then able to sell the property to a group of developers, including Slate Property Group , for a $72 million profit. The city has accused Slate of misleading it about over plans to develop the site into luxury condominiums. — Miriam Hall