The Real Deal New York

City admits it doesn’t have a legal case against Allure Group over Rivington House

Mayor said law department can't find "pathway" to seeking restitution from Joel Landau's firm

December 30, 2016 09:40AM

From left: Bill de Blasio, Rivington House at 45 Rivington Street and Joel Landau

The city’s hands may be tied when it comes to seeking restitution for the controversial sale of a Manhattan nursing home to a luxury condo developer.

Mayor Bill de Blasio, who in April vowed to sue Allure Group for flipping the property at 45 Rivington Street, said Thursday that the city’s lawyers “cannot find an actual pathway” to restitution.

“I support anything that would get us further restitution for what happened,” the mayor said at a press conference, Politico reported. “I made very clear my anger at the way the private-sector firm handled things,” he said. However, “So far, our law department cannot find an actual pathway.”

Allure made $72 million when it sold 45 Rivington to Slate Property Group, after convincing the city to lift a deed restriction on the site. The de Blasio administration maintained that Allure did not tell the city it intended to sell the building to a developer while negotiations were taking place. But a report from the Department of Investigations found that reps for Allure told the city in March 2015 that if the deed weren’t lifted, it would consider a conversion of the property to luxury apartments.

Comptroller Scott Stringer also accused Allure of misleading City Hall, but mostly faulted the de Blasio administration for mishandling information at virtually every turn. Allure maintains it did nothing wrong.

The mayor has insisted he was not aware of the deal.

Allure, led by Joel Landau, has maintained it did not lie to the city, but earlier this month, the mayor signed a bill to increase oversight of deed restrictions.

Meanwhile, the city hired two law firms this year to represent it in the Rivington deal, and in campaign finance investigations. The contracts are for more than $10 million, Politico reported. [Politico]E.B. Solomont

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