A bankruptcy judge denied a motion from the Mamdani administration to delay an auction of 5,000 rent stabilized units tenants hoped to preserve, in an early blow to the mayor’s efforts on housing.

Mayor Mamdani touring a Pinnacle building with tenants last week. (Michael Appleton/Mayoral Photography Office)

In an early blow to Mayor Zohran Mamdani’s actions on housing, a federal bankruptcy judge on Thursday denied a motion from the administration to put off the sale of 5,000 rent stabilized apartments.

Tenants who live in the 90-building portfolio have been rallying against their landlord, Pinnacle Group, which has failed to make necessary repairs and has over half a million dollars in mortgage debt.

The new mayor asked the judge to delay the sale to give the city time to put together a solution that would preserve the affordable housing. Intervening in the bankruptcy auction was one of Mamdani’s first actions as mayor. 

The judge, David Jones, was unmoved by the city’s argument, writing, “having considered the City’s written application and heard and considered the statements of all parties that appeared at the hearing, the Court denied the City’s extension request.”

Tenants were critical of Pinnacle, saying it over-leveraged its properties in hopes of removing units from rent stabilization. Landlords say New York’s 2019’s rent laws, which made it more difficult for owners to deregulate or raise rents on stabilized units, have jeopardized the financial viability of completely rent stabilized buildings like those Pinnacle owns.

The denial puts a $451 million auction bid from Summit Properties in pole position to acquire the portfolio. Pinnacle’s lawyer told Gothamist the sale would bring financial stability to the portfolio.

But tenants aren’t giving up just yet. They rallied outside Summit Properties’ office Thursday afternoon, calling on the judge to stop the sale. 

“We’re asking the judge if they stand for 10,000 rent stabilized tenants…or if they respond to two brother slumlords,” said Emma Rehac, a Pinnacle tenant in Washington Heights, at Thursday’s rally.

A recent Biznow report showed that the new bidder, Summit Properties, has ties to Jonathan Weiner, brother of Pinnacle head Joel Weiner. Summit owner David Tennenbaum appeared on the city’s worst landlord list in 2024. 

“We have organized Pinnacle tenants from all across New York to stop our 5,000-plus rent stabilized homes from being sold from one slumlord to another. Both our current slumlord, Pinnacle Group, and our new buyer, Summit properties, have more than 5,000 open violations against them,” said Rehac.

Here’s what else happened in housing—

ICYMI, from City Limits: 

Here’s everything new Mayor Mamdani did on housing during his first days in office.

The new administration is also looking to phase out the use of emergency migrant shelters that don’t comply with city rules around capacity and other standards—exemptions officials say are no longer needed now that the number of newly arrived immigrants entering the shelter system has slowed.  

At the end of last year, the Department of City Planning reassigned its central design team, a move critics say will deprioritize livability as the city pledges to build more housing.

In other City Planning news: Dan Garodnick, the agency’s director for the last four years who spearheaded the “City of Yes” zoning plan, is stepping down. 

At NYCHA’s Surfside Gardens in Coney Island, slow repairs leave seniors and residents with disabilities waiting years as broken elevators, intercoms, playgrounds, and trash compactors disrupt daily life.

ICYMI, from other local newsrooms: 

A new audit from the state comptroller’s office on the city’s main rental assistance program, CityFHEPS, highlights a number inefficiencies and makes suggestions for how the city could save on costs, Gothamist reports. 

Cea Weaver, Mamdani’s new head of the Office to Protect Tenants, sat down with NY1’s Errol Louis to talk about the role, as well as the furor over her old social media posts about homeownership.  

New York City is taking notes on new housing development from nearby Jersey City, the New York Times reports. 

Co-op owners at Carnegie House, described as the only affordable building on Manhattan’s “Billionaire’s Row,” are facing a 450 percent ground-rent hike, according to the New York Post. 

To reach the reporter behind this story, contact Patrick@citylimits.org. To reach the editor, contact Jeanmarie@citylimits.org

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