Sunday, April 3, 2016

The growing scandal over 45 Rivington St.

[Aerial view of 45 Rivington via Google Maps]

On March 22, New York City Comptroller Scott Stringer launched an investigation into the de Blasio administration's decision to lift deed restrictions on the Rivington House at 45 Rivington St., a move that netted the nursing home operator, the Allure Group, a $72 million profit off the property's sale to condo developers.

In the days that followed, many more details emerged in the media, such as that James Capalino, a de Blasio friend and fund-raiser, had been lobbying for two years for the prior owner to have the deed restriction lifted. Capalino's firm earned a record $12.9 million lobbying City Hall in 2015, according to the Times.

The Allure Group had promised that 45 Rivington — the former Rivington Center for Nursing & Rehabilitation — would remain a health facility. In February 2015, Allure paid $28 million for the property. The deed was reportedly changed in exchange for the Allure Group's $16 million payment to the city.

Allure then reportedly quietly sold the property for $116 million to the the Slate Property Group, a condo developer (and Capalino client) who plans to create 100 luxury residences in the building that overlooks Sara S. Roosevelt Park on the Lower East Side.

[Via The Wall Street Journal]

Here are some developments about the sale and investigation from this past week...


Op-ed — To catch a thief: Solution needed for de Blasio real estate deal whodunit (Daily News)

Op-ed — Why isn’t the mayor furious at this rancid deal? (New York Post)


CB3 Sent Written Plea to Mayor on Rivington House Jan. 27 (The Lo-Down)

How New York Allowed Gentrification for $16 Million (The New York Times)

Two pols demand info on deal to turn Lower East Side nursing home into condos (Crain's)


Nursing home deal, and City Hall response, raises questions (Politico New York)

And an excerpt from the Times article on Wednesday:

“I’m not happy that it happened,” Mr. de Blasio, a Democrat, told reporters on Monday. “I’m not happy about the fact that I didn’t hear about it in advance, before it became public.”

On Jan. 27, however, the local community board sent a letter to Mr. de Blasio requesting “information as to what transpired as to this transaction.” The letter was remarkably prescient; it warned that Rivington House could be converted into free-market housing, “as has been made possible by the lifting of the deed restriction.” The building was sold in February; city officials never responded to the letter, according to the community board, and Mr. de Blasio never saw it, said Karen Hinton, a spokeswoman for the mayor.

Today, the Post reports that, despite de Blasio's apparent anger over the sale, no one in his administration has taken the fall.

Also today, the Post reports that the Allure Group, "a cadre of young, seemingly disparate entrepreneurs," owes more than $6 million in back taxes on two properties in Brooklyn.

Previously on EV Grieve:
What next then for 45 Rivington St.?

Report: Developers buy former LES nursing facility for luxury housing


Anonymous said...

OK, but can anything be done or is it just that they want to know what happened!??? Can this be reversed?

Giovanni said...

If Mayor DeBlasio knew about this, and is lying to the public, then there is only one solution: Impeach DeBlasio.

Anonymous said...

Criminals, all.

Scuba Diva said...

Well, here's the Times article from April 2nd:

City Began Inquiry Into Sale of Nursing Home to Developer Before Mayor de Blasio Knew of Deal

Mark Hand The Catchman said...

Won't be reversed, no one will go to jail... maybe some apartments may be made "affordable" to lower income peeps, but affordable seems to be not so affordable these days

Anonymous said...

The old old adage: money talks, bs walks. Sad that the Mayor and his admin will be voted in for another term. Wonder what they will be up to next?

Anonymous said...

My guess, as an observer of City government, is that no-one was actually bribed but that the people at DCAS who signed off on the deed change knew that the lobbyist (Capalino) was close to the Mayor and felt they were doing the Mayor's wishes and/or wanted to build their own relationship with Capalino for future use.
I hope Preet is in the case.

ROSA said...

Bait n Switch SQUARED.

Anonymous said...

@7:28. I suppose it's possible, but why would the Mayor not know about a 16 million dollar deal is the question? Why was one of the bosses involved transferred and not fired? Is it because she didn't do anything wrong, or because if she's fired she has to much incentive to talk? All this talk about a supposed understanding that the buyers would open a nursing home strikes me as complete and utter nonsense. No one with an ounce of sense would rely on an understanding in this situation. There are many ways this could have gone down. The mayor's staff obviously had to know that Capalino was a Friend of Bill. All he had to say was, can you meet with Jim about Rivington Street. Unless someone recorded these conversations we will probably never precisely what happened. One thing we do know, is that Capalino does not get paid millions of dollars a year for his charm alone. People pay big bucks for results. Not for access, for results.

Anonymous said...

There really has to be a public-facing website that lists real estate agreements that include affordable units as part of the deal, and updates to prove that affordable units are being / have been built. Look at how the value of that building has increased in twenty years. Our currency hasn't decreased in value enough to account for that difference. This looks like a giant land grab, courtesy of our elected officials.

nygrump said...

I think WNYC is discussing this today on Brian Lehrer, if they can manage to squeeze in any programming between the moronic scarlett JOhanssen promos to 'just keep listening' they play over and over again.

Anonymous said...

There are some good candidates who can run against the blaz, maybe even Stringer.

Atomic Man said...

3:04... MAYBE even Stringer?

What do you think this is ALL about?

Anonymous said...

Former Mayor Bloomberg sold NYC to luxury real estate and paved the way for the continuing tsunami even though Bloomberg's term ended two years ago. Bloomberg changed land use rules and established the policies that establish "open season" as the new normal.

I don't think DeBlasio knew what was going on here but clearly big mistakes were made by someone.
IMO the City Councilperson is really at fault for not elevating this issue.

I think DeBlasio supports real estate because he thinks - mistakenly - that it will result in affordable housing. Actually real estate will destroy EXISTING affordable housing in order to build new luxury and a few affordable units with tax breaks.

On the other hand Michael Bloomberg really believed in the entitlement of the affluent, whether young transplants from the suburbs or middle age media/finance or international billionaires. Bloomberg actively sought to remake NYC for the wealthy.

Sadly Scott Stringer is actually a supporter of big real estate. He has supported NYU's takeover of the Village and rezoning of midtown. He has supported creation of a luxury development plans near the seaport etc. And more.