Government briefs

HUD Secretary Shaun Donovan
NYC public housing gets $350M boost

Armed with $350 million in new financing, the New York City Housing Authority announced last month that it planned to start renovation work on 20,000 apartments in 21 developments. NYCHA is getting $100 million in federal stimulus funds, $210 million from bond sales and $40 million from the state in what Department of Housing and Urban Development Secretary Shaun Donovan called the “most significant preservation action in the history of public housing.” The new funds — plus an additional $65 million per year — will go toward developments built by the city and state in an unprecedented action, the New York Daily News reported. 

One Madison Park told to offer buyers refunds

State Attorney General Andrew Cuomo’s office, which regulates the sale of condominiums in New York, told the developers of the financially troubled One Madison Park condominium last month to offer refunds to any buyers who have not closed on their apartments. Cuomo’s office forced the rescission offers after senior lender iStar Financial filed in February to foreclose on developers Ira Shapiro and Marc Jacobs (not the designer) for allegedly defaulting on five months of interest payments, pledging apartments without the bank’s permission and allowing the building loan to fall out of balance by $63.6 million, according to court documents and legal sources. Such a move could require the developers to refund deposits on more than 40 percent of the 69-unit tower at 23 East 22nd Street. 

NY’s foreclosure backlog among worst

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The New York metro area has the second-largest backlog rate for bad loans among the country’s top 10 markets, according to a recent Barclays Capital report. With 21 percent of its loans still in the delinquency pipeline, the region, which thus far hasn’t been hit as hard as others by price declines, could take longer to recover as the dud loans work their way through the system. The large backlog likely stems from the judicial foreclosure process in New York, where the process is more prone to delays because judges have to sign off on all foreclosures, according to the Wall Street Journal. 

Barclays Center breaks ground

Investors, city officials and developer Bruce Ratner, CEO of Forest City Ratner Companies, came together last month to celebrate the groundbreaking of the new Barclays Center at the Atlantic Yards development. The 18,000-seat arena, which will serve as the home of the soon-to-be Brooklyn Nets, is expected to open in 2012. At the ceremony, Mayor Michael Bloomberg described the Barclays Center as “the first piece of what will be one of the largest private investments and job generators in Brooklyn’s history.” 

Second ILSA loss for condo plaintiffs in two months

For the second time in seven weeks, a federal judge in New York State last month sided with a developer against buyers of condominium units who tried to use the Interstate Land Sales Full Disclosure Act, or ILSA, to cancel contracts and get deposits back. A judge in Brooklyn federal court ruled in favor of the developer of One Hunters Point in Long Island City, against eight plaintiffs who had given over $563,285 in deposits, a decision filed on March 12 shows. In the previous case in January, for the first time in 20 years in New York, a federal judge ruled on an ILSA case. In that case, a Manhattan judge sided with Uptown Partners’ 5th on the Park against two buyers who wanted to get their deposits back at the Harlem project.