Deed Deal Reaps Millions – and Sparks an Outcry

Last month we reported that the sudden lifting of a deed restriction had allowed a troika of developers to move forward with plans to turn a Lower East Side HIV/AIDS nursing facility into luxury condos. Now, The Wall Street Journal reports, city comptroller Scott Stringer is investigating the deed deal after a public outcry over the building's sale to developers China Vanke Co., Adam American Real Estate, and Slate Property Group.

The disputed property, Rivington House, is located at 45 Rivington Street between Forsyth and Eldridge Street. In 2014, nonprofit care provider VillageCare sold the building to for-profit care provider Allure Group for $28 million. Allure then paid the city’s Department of Citywide Administrative Services (DCAS) $16.5 million to lift the deed restriction that had required the building to be used as a nursing facility in perpetuity. Allure then sold the building to the condo developers for $116 million, a tidy $71.5 million profit. Welcome to the world of New York City real estate in 2016.

In a statement, the city comptroller’s outrage over the lifting of the deed was apparent. “It is incomprehensible,” Stringer said, “that this property, which provided long-term care for patients with HIV/AIDS for more than two decades, would reportedly be converted into market-rate luxury housing without robust discussion, transparency, and input from the community it serves.”