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HUD Secretary Says "No Deal" To Starrett City Sale
In the announcement, HUD secretary Alphonso Jackson said Starrett City would remain "a viable community for New Yorkers of modest means." "The door is not open; the door is actually closed," commented Jackson, before adding he might reconsider if the company can prove it will preserve the complex as affordable housing. In keeping his February 16 assurance to reach a decision about the Starrett City deal in two weeks, Jackson last Thursday sent a letter to the lawyers for the buyer, Clipper Equity, a group led by real estate investors David Bistricer and Sam Levinson, informing them of his conclusion, but left open the possibility the deal could be reworked. The top HUD official wrote that he had "serious concerns" about whether Bistricer should be involved in a federally funded housing complex since he has a record of numerous housing code violations at another Brooklyn development. City housing officials previously noted that Bistricer, one of the investors who won the bidding for the 140-acre complex four weeks ago, owns 71 other buildings cited for more than 8,700 violations, "including some for dangerous violations." U.S. Senator Charles Schumer, Rep. Edolphus Towns and New York State Attorney General Andrew Cuomo joined Jackson in Washington Friday morning for the formal announcement of the bid denial. At the press conference, Jackson said, "This department will not stand idly by while a community and its people are unnecessarily placed at risk of losing their homes and way of life." Jackson's letter indicated that Clipper Equities has not provided sufficient information to demonstrate their financial and managerial capability for preserving Starrett City as affordable housing on a long-term basis. "The department will not stand by," Jackson wrote, "while the community and its people are unnecessarily placed at risk of losing their homes and way of life." If the sale was not rejected, Cuomo previously said he could enforce a 1998 injunction secured by his predecessor, now Gov. Eliot Spitzer, which prohibited Bistricer from converting rental properties to condominiums or cooperatives after numerous complaints from his tenants. The documents describing the real estate investor's record of violations, which Cuomo gave to Jackson during his Feb. 16 visit to Starrett City, were apparently the catalyst that led to the sale being rejected. In Brooklyn several hours later, Schumer and Towns appeared at the Christian Cultural Center on Flatlands Avenue to make the announcement to elated residents of the 46-tower development, which was renamed Spring Creek Towers five years ago. Clipper Equity has maintained all along that it was "totally and absolutely committed to preserving affordability" at Starrett City. However, elected officials and real estate analysts countered that anyone who pays $221,000 per apartment and accepts millions a year in property taxes would have to charge top dollar for their investment. Ever since Starrett Associates accepted the Clipper Equity bid four weeks ago, nearly every local elected official, including Governor Spitzer, Mayor Michael Bloomberg, Borough President Marty Markowitz and City Councilman Charles Barron, joined Schumer, Sen. Hillary Clinton, Towns and Rep. Anthony Weiner to offer support to insure that monthly charges do not skyrocket at the complex and become too expensive, further reducing the number of affordable housing units in the city. Potential buyers interested in ac-quiring Starrett City were put on alert in Jackson's letter that unless a consensus can be reached that "a comprehensive plan exists to preserve affordability and the quality of life for (Starrett City) residents, HUD's appro-val will not be forthcoming." The tenant advocacy group, ACORN, that has been working with the Starrett City tenants association issued a statement that said, "While this is a major victory, the fight to save Starrett City is far from over…Until the state legislature and the governor pass legislation to keep rent stabilized, the residents of Starrett City will live with the threat of eviction hanging over their heads." After the HUD announcement, Clipper Equities issued the following statement: "We remain convinced that we can provide the assurances that Secretary Jackson and other officials, responsibly require."
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