[5th Street buildings that were part of Raphael Toledano's portfolio]
New York Attorney General Letitia James announced a court victory yesterday against notorious East Village landlord Raphael Toledano.
An order by the New York Supreme Court bars Toledano from engaging in any New York real-estate business activity for at least five years, at which point he can petition the court for re-entrance.
Per a release from the AG's office:
This decision comes after Toledano repeatedly violated a 2019 agreement with the Office of the Attorney General (OAG) that required him to stop harassing New York City tenants and stop engaging in illegal and predatory real-estate practices.
"New York tenants can breathe more easily knowing that Rafi Toledano is no longer in the real estate business," said James. "Through his deceptive and illegal actions, Toledano caused incredible pain and suffering to hundreds of vulnerable families, who are still feeling the effects of his harassment today. Every New Yorker deserves to live in a safe, decent home free of abuse and fear."Here's some of what James found from her previous investigation:
" ... established that Toledano engaged in a pattern of fraudulent and illegal conduct throughout his work as a landlord and real estate developer. Toledano harassed tenants in the East Village through coercive buyouts and illegal construction practices, and failed to provide his rent-regulated tenants with utilities, repairs, and other necessary services.
Toledano also engaged in deceptive business practices in his real-estate transactions, including repeatedly and persistently misrepresenting himself as a lawyer and advertising apartments with three or four bedrooms, when legally the apartment could have one or two bedrooms only."The AG's office outlined how Toledano violated his 2019 agreement:
- Failing to disclose his real-estate business activities to the independent monitor or to get the monitor's approval for further deals
- Diverting funds from a reserve account established by the agreement
- Failing to make penalty payments (other than initial payments totaling $520,000)
- Failing to maintain his properties in a manner that complied with applicable laws and protected tenants' rights, health, and safety.
It's not immediately clear how many properties Toledano still owns.
Last May, Madison Realty Capital (MRC) closed on Toledano's bankrupt East Village portfolio. Toledano had received $124 million in cash and lines of credit from MRC to finance his $97 million purchase of the buildings.
Toledano purchased 28 buildings in two separate portfolios from the Tabak family for a total of $140 million in 2015. Experienced real-estate players raised red flags about Toledano's heavy reliance on debt.
In an interview with The Real Deal in June 2016, Toledano, then 26, made "frat-tastic boasts about his wealth," including: "I'm worth a fuckload of money, bro."