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New York, NY - Mayor’s Initial Claims On Rivington House Deal Now Appear Questionable

Published on: April 25, 2016 12:04 PM
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New York, NY - Claims by Mayor Bill de Blasio that he was completely in the dark about the hugely criticized dealings involving a Lower East Side nursing home are ringing hollow as word emerges that members of his administration desperately tried to undo a mistake that lifted a deed restriction on the property, allowing the new owners to flip the building to a real estate developer.

As previously reported on VIN News, the Department of Citywide Administrative Services lifted a deed restriction on the Rivington House property in November 2015. That move paved the way for the Allure Group, the new owners of the property, to flip the property this past February to a luxury condominium developer for $116 million, recognizing a $72 million profit.

The New York Post reported yesterday that the mayor said on March 28 that he had just recently learned about the deal, but as much as a month earlier, members of the de Blasio administration were frantically trying to back out of the deal.

On February 24, James Patchett, chief of staff for Deputy Mayor Alicia Glen, offered to refund the $16.1 million Allure had paid to have the deed restriction lifted on Rivington House.

A source said that Patchett told a spokesperson for Allure that in exchange for the refund, the property would need to be kept as either a long term care facility or converted to affordable housing, a pet project of de Blasio’s, saying that that was what “the Mayor’s Office wants.”

Allure advised Patchett that the property had already been sold and it was too late to back out of the deal.

Patchett tried once again to backpedal on the deal, telling the Allure representative that the situation was an “important issue to us” and saying that he would “highly encourage” Allure to allow City Hall to issue the refund that would return the deed restriction to the property.

The de Blasio administration has insisted that Allure made representations to them that the property would be kept as a long term care facility, allegations that have been denied by Allure.  Sources said that Allure told the city on numerous occasions that having made the $16.1 million payment to lift the deed restriction, it could not afford to keep the property as a nursing home.


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Read Comments (11)  —  Post Yours »

1

 Apr 25, 2016 at 12:33 PM Chaim Says:

It's slowly becoming clearer that the city messed up by completely lifting the restriction, which gave the owner the green light to do with the property whatever they pleased. I am not jumping to any conclusions as to the Mayor's involvement here.
The Post will say whatever makes them sell their rags.

2

 Apr 25, 2016 at 12:38 PM Anonymous Says:

If US Attorneys office investigates this will not be pretty for one of them (or both)

3

 Apr 25, 2016 at 01:32 PM kenyaninwhitehouse Says:

This guy reminds me of Robert Mugabe in his corruption.

4

 Apr 25, 2016 at 01:38 PM PowerUp Says:

Deblasio needs be very carefull here, this might be the straw the broke the camel's back

5

 Apr 25, 2016 at 02:06 PM Tzi_Bar_David Says:

Reply to #1  
Chaim Says:

It's slowly becoming clearer that the city messed up by completely lifting the restriction, which gave the owner the green light to do with the property whatever they pleased. I am not jumping to any conclusions as to the Mayor's involvement here.
The Post will say whatever makes them sell their rags.

You need not jump to conclusions, but I will. What "representations" did Allure make? None of them appear to have been in writing. This is the most sophisticated real estate market in the world, are deBlasio and his minions really such rubes that they rely on verbal assurances over a parcel of Manhattan real estate with a fair market value north of $100m? I think not, and nor does the US and State attorneys general. Please, where there is smoke there is fire and in deBlasio's case it is a conflagration that will consume him and all of his hangers on. That day cannot come soon enough.

6

 Apr 25, 2016 at 02:23 PM Anonymous Says:

They can bunk with Shelly.

7

 Apr 25, 2016 at 03:20 PM Doc Says:

Who does the mayor think he is fooling? It was a 35 bed nursing home, which was losing money all along. Do they really think that with 16 million dollars extra on top of 28 million dollars to buy the building they would make a profit? Obviously it was going to be sold.

8

 Apr 25, 2016 at 05:08 PM Anonymous Says:

Low income housing raises prices on real estate for everyone.

9

 Apr 25, 2016 at 06:41 PM Chaim Says:

Reply to #7  
Doc Says:

Who does the mayor think he is fooling? It was a 35 bed nursing home, which was losing money all along. Do they really think that with 16 million dollars extra on top of 28 million dollars to buy the building they would make a profit? Obviously it was going to be sold.

The city came up with a price tag of 16 million based on an appraisal they got. They messed up by lifting the restriction instead of just modifying it, which ultimately gave the owner the greenlight to do whatever he pleases with it.

The city can go ahead and sue the appraisal company for not doing their job properly.

10

 Apr 26, 2016 at 09:30 AM Tzi_Bar_David Says:

Reply to #9  
Chaim Says:

The city came up with a price tag of 16 million based on an appraisal they got. They messed up by lifting the restriction instead of just modifying it, which ultimately gave the owner the greenlight to do whatever he pleases with it.

The city can go ahead and sue the appraisal company for not doing their job properly.

The appraisal was of the property WITH the deed restriction.

11

 Apr 26, 2016 at 07:39 PM Chaim Says:

Reply to #10  
Tzi_Bar_David Says:

The appraisal was of the property WITH the deed restriction.

If the city failed to do an appraisal of the property without the restriction (in advance), that is entirely their problem/negligence.

It's also important to realize that this property wasn't owned by the city. The whole validity of the restriction may have very well been in question as well.

12

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