From the July issue: When a landlord is implicated in a tenant–harassment case, it’s usually their name — and their name alone — that makes headlines.
Such was the case with Raphael Toledano at 444 East 13th Street, where rent-stabilized tenants charged that the controversial broker-turned-landlord’s management company was bullying tenants into moving out to pave the way for rent increases.
But weeks after news broke that the state was investigating Toledano for tenant harassment at the East 13th Street building, he scored two loans totaling $124 million from private equity firm Madison Realty Capital to buy and renovate a 16-building, $97 million East Village portfolio.
The leverage on the deal — which clocked in at 128 percent compared to the typical 50 to 65 percent on a New York City multifamily deal — raises questions about how culpable lenders are in perpetuating harassment. In short, are they turning a blind eye when their borrowers too-aggressively push to turn rent-stabilized apartments into luxury units?