|Milbank's 10 Bronx buildings have over 4,000 housing violations among them. (File photo by J. Evelly)|
Steve Finkelstein bought the mortgage and the deeds to the properties in a $28 million deal, the article reports, promising to start serious and immediate repairs at the violation-riddled buildings, and agreeing to report to HPD within 30 days about what work he's done.
Finkelstein, who owns 31 other buildings in the Bronx, told Crain's he expects to face an "amazing amount of work," but that he's sending eight-man crews into every building to start on repairs.
LNR Property LLC, the servicer to the loans attached to the buildings, had been looking to sell since last fall. Tenants, housing advocates and elected officials tried to intervene in the sale, worried that a new buyer saddled with debt would only mean more neglect for the properties. At least one potential buyer, Chestnut Holdings, backed out after pressure from HPD and city officials.
California-based group Milbank Real Estate bought the buildings back in 2007 with a hefty $35 million mortgage, presumably with the goal of raising rent prices to turn a profit. Milbank defaulted on the loan, however, and tenants say things started to fall apart once foreclosure began.
Tenants and a number of advocacy groups have been trying to get the buildings fixed ever since. Last year, Legal Services-NYC Bronx filed a motion on behalf of tenants to hold LNR financially responsible for fixing up the buildings, eventually succeeding when a judge order LNR to pay $2.5 million (a decision that LNR has since appealed).
Jonathan Levy, a lawyer with Legal Services-NYC who filed that motion, told Crain's he's "cautiously optimistic" about Finkelstein's taking over.
Meanwhile, a group of tenants from another batch of foreclosed Bronx buildings--mortgages lent by New York Community Bank--are waging a similar campaign to hold the bank responsible for making repairs. More on that here and here.