In another of several unfolding developments surrounding the controversial sale of a Lower East Side adult care facility, the city has decided to perform a new, more comprehensive analysis of the deal that granted Slate Property Group the development rights for a Brooklyn armory. Slate has achieved some notoriety for covering up its acquisition of the Rivington House nursing home earlier in 2016, which is expected to be turned into profit-making condos.
“We’re going to take a very hard look at that situation — the contract has not been finalized,” Mayor de Blasio stated, according to the New York Post. “I think what they did was inappropriate. And I think anyone who seeks to do business with the city of New York and misleads us needs to know that there will be consequences.”
In December of 2015, Slate and BFC Partners were awarded a contract to redevelop the 500,000-square-foot Bedford-Union Armory, a property that is owned by New York City. A number of Crown Heights-based groups are now protesting against the contract, given the role that Slate has played in the Rivington House scandal. Groups including New York Communities for Change and the Crown Heights Tenant Union were planning a public protest to seek a halt to the Slate Property Group’s takeover of the armory.
A recent report by the Department of Investigation (DOI) regarding Rivington House stated the following:
Prospective purchaser Slate sent an e-mail to its staff (on May 14, 2015) saying “do not discuss this deal…the seller (The Allure Group) is very concerned that the city and union will find out that [the seller] is in contract to sell at the price that we are buying it which will directly impact his ability to have the deed restriction removed. Once he has it removed we can do whatever we want.”
Slate Property Group won the right to convert the Bedford Union armory in Crown Heights into 330 apartments just prior to its closing the deal on the nursing-home purchase in February. The Rivington property was sold despite community objections after the city waived a deed restriction that would have required the purchaser to maintain it as a nonprofit community health care facility. That sale is presently embroiled in an investigation.
Only this past week, the mayor’s own Economic Development Corporation defended Slate’s involvement with the armory, saying the firm won the contract fairly.
Slate purchased the Rivington House nursing home for $116 million in February with plans to change it over into luxury housing — but only after the seller persuaded the city to remove the deed restriction that was in place for decades.
Seven months later, the city’s Economic Development Corp. awarded Slate and BFC Partners a lease fully allowing them to develop the building.
But the backlash has been strong. “Slate has proven they cannot be trusted — they’re a deceitful developer,” charged Renata Pumerol, a spokeswoman for NYCC.
According to Economic Development Corporation spokesman Anthony Hogrebe, the agency had no knowledge of the Rivington sale when Slate was chosen for the Crown Heights project. Slate described the verbal attacks on its integrity as “meritless.”