The city looks to close a $173 million deal to purchase 17 buildings this week for the purpose of turning them into affordable housing. The idea sounds good until you find out that there could be financial conflicts of interest and issues with transparency, the Real Deal reports.
The Real Deal explains how “The de Blasio administration opted to buy the buildings in Brooklyn and the Bronx two years ago from the Podolsky brothers, two landlords with a long record of violations who are currently under federal investigation for tax fraud. And the lawyer who represented them in the portfolio sale to the city is Frank Carone, is a longtime de Blasio ally and fundraiser.”
According to the New York Times, the buildings had an estimated value of $50 million, but a private appraiser put that price at almost $100 million higher for all the properties, at $143 million. The Real Deal reports that the excuse city officials used was that prices increased during negotiations.
It gets murkier though because Carone gave $5,000 of contributions for the political action committee backing the mayor for a possible run at president. De Blasio and Carone stressed that this real estate deal has not come up in conversations between them before.
City comptroller Scott Stringer last month tried to get the appraisals, but he was stonewalled by a city policy of not giving out information that could alter future negotiations.
The mayor’s press secretary, Eric Phillips, said de Blasio’s ties to Carone have no impact on the deal.
“This deal is about improving and securing affordable homes for 2,000 people,” Phillips said in a written statement. “The personal political activity of one of the many lawyers involved never entered into the equation.”
“They’ve never spoken about any details of the deal,” he said about the mayor and Carone.
The mayor has also been busy touring the country as he considers a presidential run. He was asked recently some questions such as what his position on reparations is.
“There’s no question that the issue of reparations has to be taken seriously,” de Blasio said. “I do believe the way to do it is to form a very public commission and say, ‘What is the way to address this problem once and for all?’”
At the event, de Blasio said that there needs to be a larger “discussion about income inequality and oppression of other groups including Latinos, Native Americans, Asian and women.”
“I think we’re going to need something bigger even in a way, broader even in a way, then some of the ideas that have been put out there,” de Blasio said. “I think a program of actual redistribution which includes much heavier taxes on the wealthy.”
“The ultimate resolution has to be profoundly economic,” de Blasio added.
