When Pinnacle Group placed thousands of rent-stabilized New York flats out of business, it found itself in a fight with Mayor Zohran Mamdani’s administration — and with tenants.
Now, parts of that combat proceed to play out in chapter courtroom.
Tenants at one of many buildings positioned out of business have requested a choose to order a Pinnacle affiliate to make repairs to the property. The tenants first took the proprietor to housing courtroom over residing situations in 2023.
Chapter courtroom is most frequently a battleground for lenders and debtors. However tenants and Mamdani’s administration raised the profile of the Pinnacle case with novel makes an attempt to make use of chapter courtroom as a venue to combat about housing situations and potential patrons.
Though they had been unsuccessful of their efforts to cease a sale, the movement exhibits they haven’t completely deserted the technique.
“The complete time that the chapter course of has been taking part in itself out they’ve had no recourse, they’ve had no discussion board to which they may flip to get these repairs ordered,” stated LT Tierney, a workers legal professional on the Authorized Support Society who’s co-counsel for the tenants behind the movement. “They shouldn’t have to attend any longer.”
Tenants’ attorneys are nonetheless hoping they’ll make chapter courtroom work for them, partially as a result of they’ve few different choices. The chapter stayed all litigation, together with housing courtroom instances.
Tenants at 639-645 West 207th Avenue introduced their landlord to housing courtroom in 2023, alleging their constructing was in disrepair. They later moved for contempt towards the Pinnacle affiliate. In February 2025, the 2 events settled, with Pinnacle committing to remedy violations by June 2025.
However now these tenants say their points haven’t been addressed. In courtroom paperwork, they complain of damaged home windows, collapsing ceilings, and rats.
They’re hoping the choose within the case will order the owner to make repairs, regardless that there’s a pending sale to Summit Properties. A part of the argument they’re making is that Pinnacle is failing to keep up its main asset, which is unhealthy for collectors in addition to residents.
A spokesperson for Summit stated the corporate was conscious of the litigation and, “upon closing, will tackle all excellent claims on a case-by-case foundation.”
Tenants and the Mamdani administration tried to stop the sale of the portfolio at the start of the yr, hoping for extra time for a extra mission-driven purchaser to emerge. However after hours of testimony and argument, the choose confirmed the bankruptcy plan in January. Summit bid about $451 million for the 5,151 largely rent-stabilized flats.
Tenants drew consideration to hazardous housing code violations within the portfolio, however Summit CEO Zohar Levy testified that solely 8 p.c of the models had open violations. Summit would spend $10 million curing those, he stated, together with one other $20 million dedicated to repairs and upkeep over the subsequent 5 years.
The Pinnacle associates entered chapter owing mortgage holder Flagstar Financial institution $564 million. In filings, Pinnacle head Joel Wiener blamed the monetary bother on elevated rates of interest and statewide laws that made it practically impossible to raise rents in stabilized apartments.
A spokesperson for Pinnacle Group declined to remark.
Learn extra
Who’s still buying rent-stabilized buildings?
Summit plans to spend $30M fixing the Pinnacle portfolio. Will it appease Mamdani?
Summit’s deal with Pinnacle, by the numbers
