This article may contain commentary
which reflects the author’s opinion.
A federal bankruptcy judge on Thursday blocked New York City Mayor Zohran Mamdani’s attempt to intervene in the sale of thousands of rent-stabilized apartments. The Mamdani administration sought to delay the transaction after tenants complained that the current owner, Pinnacle Group, had failed to properly maintain the properties.
Tenants also raised concerns that the prospective buyer, Summit Properties USA, could continue similar practices.
City officials argued they had standing to intervene because New York City is a creditor of Pinnacle, which owes more than $12 million in unpaid fines, according to Gothamist.
Bankruptcy Judge David Jones rejected the city’s request, preventing the administration from taking part in the sale and marking an early setback for Mayor Mamdani’s efforts to influence housing policy through the courts, Fox Business Network added.
Jones could approve the sale to Summit as soon as this Thursday, but Mamdani’s administration says they are still looking at options.
“We will continue to fight to ensure any owner of this portfolio makes necessary repairs to bring the buildings up to code and respects the rent stabilization regulations,” Leila Bozorg, the city’s deputy mayor for housing, told the outlet.
The recent court defeat follows another controversy that has harmed Mamdani’s housing agenda: his appointment of Cea Weaver to lead the Mayor’s Office to Protect Tenants. Weaver has previously claimed that homeownership is a “weapon of white supremacy” and has argued that property should be regarded as a “collective good.”
In light of the ongoing controversy regarding her comments, Weaver expressed regret for “some” of her past statements. Although she did not specify which remarks she regrets, Weaver emphasized her commitment to addressing “racial inequalities” while serving the people of New York.
“But, you know, I do think my decades of experience fighting for more affordable housing sort of stands on its own,” Weaver said. “I’m proud to be in this role fighting for stronger tenants’ rights. And I think that for many years, people have been locked out of the property market, that has produced systemic and racial inequalities in our system.”
“I want to make sure that everybody has a safe and affordable place to live — whether they rent or own,” she added. “And that is something that I’m laser-focused on in this new role.”
Pinnacle, owned by billionaire Joel Wiener, controls roughly 140 buildings and about 9,000 apartments across New York City, according to court filings. Following the bankruptcy filing, Summit Real Estate Holdings submitted a $450 million bid to purchase dozens of Pinnacle properties located in Brooklyn, Manhattan, the Bronx and Queens. The proposed sale requires court approval before it can be finalized.
“Completion of the bankruptcy auction process will bring financial stability along with the opportunity to stabilize services, outcomes which we would expect the City would not want to disrupt,” Pinnacle lawyer Ken Fisher noted in a recent statement about the coming sale, according to the outlet.
In court filings, the city’s lawyers expressed concerns about the financial aspects of the bankruptcy sale, indicating that Summit may lack the necessary resources to enhance conditions in the housing complexes it aims to acquire.
“Continuing losses and mounting expenses might lead to the need for additional bankruptcies or reorganizations, a state of financial and social chaos potentially worse than the current situation of the debtors themselves,” the city said.
The Union of Pinnacle Tenants, a collective formed to resist the sale of their buildings, claims that the current landlord has neglected maintenance, failed to settle utility bills, and allowed the apartments to fall into disrepair. They are concerned that the next owner will not make improvements to living conditions.
The struggle over the Pinnacle properties became a central issue in the recent mayoral race, with housing advocates highlighting how New York City’s skyrocketing rents and housing expenses are adversely affecting low-income residents, potentially leading to increased homelessness. New York is known for having some of the highest housing costs in the country.
