Tenants, activists and press crowded the halls of Lower Manhattan bankruptcy court, eager to see the new landlord, Zohar Levy.
Levy’s Summit placed a $451 million stalking-horse bid for a 93-building, approximately 5,200-unit portfolio put into bankruptcy by Pinnacle Group. Now, the little-known investor, taking a break from a family vacation in Europe to answer questions from the city and tenants’ attorneys by video call, was about to become a New York City rent-stabilized landlord.
Did he know what would come next?
“We are aware of the responsibility attached to managing such a portfolio,” Levy said at his testimony in January.
Bankruptcy court, usually procedural, had turned into a testing ground for how the city would fulfill its promises to tenants, as New York City’s new mayor Zohran Mamdani objected to Summit’s bid at the last minute and sought a delay in the bankruptcy. The city questioned whether the deal was financially viable, noting that nearly all of the units were rent-stabilized with below-market rents. In filings, attorneys asked how the property’s income could cover its debt costs.
Those in the industry had similar questions. Investor interest in rent-stabilized portfolios plunged after the passage of Housing Stability and Tenant Protection Act of 2019, which made it impossible for landlords to substantially raise rents, even following a vacancy. The Federal Reserve’s rate hikes starting in 2022 only made things worse. The asset class was deemed uninvestable, and the doomsday scenario spun out: Owners would no longer pay for basic maintenance, properties would fall into the hands of vulture investors, the city’s housing stock would further erode and banks would be left on the hook with millions in bad loans.
“Everything can be done with less money.”
Even typically level-headed advisors and think-tank fellows began to sound the alarm.
“Unless we vastly increase the amount of budget for subsidized housing, almost all of it is going to have to go to rescuing these buildings,” Mark Willis of NYU’s Furman Center for Real Estate and Urban Policy said in a presentation last April. He suggested that an intervention might be needed to save the buildings.
Yet Zohar Levy is neither a government intervention, an out-of-town speculator nor an optimist expecting the state’s rent law to change. Now in his late 50s, Levy made a fortune investing in Germany’s real estate market, and amid all the noise, he believes the numbers simply pencil out.
“The fundamentals of the portfolio provide a steady, albeit conservative, return on the investment,” a Summit spokesperson said.
If he’s right, the deal throws water on the fiery arguments of both tenant and landlord advocates.
The buyer
Levy was born in Haifa, Israel, and studied accounting at school. He became the CFO of Engel Resources, a real estate firm run by his father-in-law, billionaire Jacob Engel, who made one of his many fortunes building housing for post-Soviet immigrants to Israel in the early 1990s.
Levy went out on his own in about 2002. In his first deal, he bought a struggling real estate company in Israel, known as Chayel Holdings. He saw an opportunity to cut costs, restructure its debt and find profitability.
“It all started with an ad I saw in the newspaper for the sale of Chayel Holdings,” Levy said in an interview with the Israeli business publication Globes in 2005.
Levy slashed management costs at Chayel from 12 million shekels to 1.5 million shekels a year, telling Globes that income-producing real estate companies did not need so many expenses such as managers, cell phones or engineers on hand.
“I discovered that everything can be done with less money,” he said in Hebrew in the Globes interview. Collectively, press about Levy describes him as a private person with an analytical mind.
He rebanded the firm as Summit and raised money by issuing bonds in Israel’s capital markets.
(Lilah Burke/The Real Deal)
In 2004, Levy saw Germany as the next frontier for undervalued assets. At the time, Germany’s economic growth was stagnant. It was not a popular destination for international investors. But Levy started acquiring grocery-anchored retail centers and other commercial and residential properties.
Starting in 2007, Summit’s German business grew rapidly. The company raised 300 million euros on the London Stock Exchange. It acquired Deutsche Real Estate AG, a publicly traded company on the Frankfurt Stock Exchange.
Levy decided to move out of the German market in the early 2020s. He unloaded most of Summit’s German portfolio, grossing over 1 billion euros and reinvested the money into U.S. real estate. Summit created a U.S. subsidiary, which acquired stakes in 90 residential buildings with 3,100 units, two unspecified hotels in New York City and 27 retail centers and malls across the country.
Levy’s work was not limited to real estate. Summit took a 16 percent stake in Paz, an Israeli energy and retail company, which he sold in July 2025 for 1.1 billion Israeli shekels, or $350 million. It was one of the largest deals in Tel Aviv Stock Exchange history, according to Globes.
Summit’s deals also include value-add opportunities with higher risk. In October 2025, Summit acquired the leasehold on 444 Madison Avenue, a 42-story Class B office tower for just $42 million. The previous owner, Westbrook, bought the lease on the 1930s-era office building for $314 million in 2007.
But Levy was still not a known player in New York City real estate. His acquisitions of rental buildings were made through a limited partnership. When The Real Deal reached out to sources about Levy, few had heard of him.
Then came the Pinnacle auction.
The portfolio
In 1997, Pinnacle Group owned 267 apartments in New York City, the New York Times reported. Joel Wiener slowly grew the business to over 20,000 units, largely rent-stabilized, across Queens, Brooklyn, Manhattan and the Bronx. He also converted over a dozen of the rent-stabilized apartment buildings into condominiums.
Over the years, tenant groups accused Wiener and his company Pinnacle of shoddy repairs and rent overcharges, especially as demand ratcheted up for the gentrifying neighborhoods where he owned.
Wiener was among the first U.S. developers to sell bonds in Israel, providing him with over $500 million in cheap financing. By 2017, his portfolio was valued at $2 billion and Wiener himself was a billionaire, according to Bloomberg.
Things started to go south for Pinnacle in 2019, after the state law limited stabilized landlords from raising rents after making improvements. It also made it more difficult for landlords to convert rent-stabilized buildings into condos.
In May 2025, Pinnacle’s lender, Flagstar Bank, initiated a foreclosure on a $564 million loan tied to the 5,200-unit portfolio. To stop the foreclosure, Pinnacle put those properties into bankruptcy protection, valuing the portfolio at $826 million.
“We didn’t view it as a heavy lift.”
A month later, Levy met with Wiener and his associates, according to Globes. (Wiener has an Israeli subsidiary called Zarasai Group.)
Summit was also seeking to make a deal with Pinnacle’s Israeli bondholders, Globes reported. The bonds, which were trading for junk status, would be converted to shares of a new real estate company controlled by Summit.
A Summit spokesperson said the deal never materialized.
Instead, Summit decided to enter the contentious bankruptcy process for a much bigger slice of Pinnacle’s portfolio. Eastdil Secured ran the marketing process attracting 14 offers on the first round of bidding and seven qualified offers in the second round. Summit was the stalking horse bidder.
PH Realty’s Peter Hungerford, whose firm has acquired 4,100 apartment units, including recent purchases of stabilized stock, said he made a bid on the Pinnacle portfolio. After tours, he found the conditions to be “good overall.”
“We didn’t view it as a heavy lift,” he said.
But Summit was the winning bidder after a multi-round process, offering $451.3 million or $87,000 per unit.
Flagstar slashed its debt and offered Summit a $338.5 million loan for the acquisition at an attractive rate of 5.25 percent. (Summit’s spokesperson said the terms of the loan were part of a negotiation. Flagstar did not return a request to comment.)
The plan
Summit had penciled the deal as a run-of-the-mill apartment deal, with lower debt costs that will allow the firm to increase cash flow, according to Summit. The firm expects to bring in $36 million in net operating income annually which amounts to a capitalization rate of about 8 percent. (The cap rate, a metric showing the property’s potential return, for New York City walk-up apartment transactions during the fourth quarter of 2025, averaged 7.46 percent, according to Cushman & Wakefield.)
But the city’s legal team appeared unwilling to accept Summit’s numbers. During the bankruptcy process, lawyers raised questions about Summit’s financial ability to cure violations, history as a property owner and limited experience running real estate in New York.
Summit responded, noting that only 420 units, or 8 percent of the portfolio, account for all of the violations. It said it would spend $10 million in the first year fixing violations and addressing maintenance needs with $3 million specifically on existing violations. In five years, it would spend a total of $30 million in capital improvements.
The city’s close involvement wasn’t a deterrent.
“This is a high profile deal with a lot of public attention. It is not surprising that the City took such an active role,” a Summit spokesperson said. “We understand the City’s concern and look forward to working with them to improve the buildings.”
On Jan. 16, David Jones, the bankruptcy court judge, approved the sale.
“Summit’s statements make clear its commitment to do what is needed,” Jones said. “The city’s approach to this case gives me confidence that the city will monitor and police Summit’s performance.”
If Summit’s assessment is to be believed, about 92 percent of the portfolio is in good shape. Summit is budgeting only $30 million, or $97 per unit per month, to repairs. In the big picture, that’s not very much. Because Mamdani has vowed to “freeze the rent” by appointing new representatives to the nine-member Rent Guidelines Board, the landlord won’t get annual increases on the units if it has underestimated the work.
With no expectation of vacancy decontrol or substantial rent increases, the numbers may be tougher to hit — the landlord advocates and the city now both admit the expenses are high and the income too low.
But if Levy, the accountant, has it right, he may get back to an older way of running rent-stabilization buildings, where owners held property for long periods of time, expecting steady cash flow rather than large returns on future sales.