Mismanaged Co-ops on the Hook for More Than $21 Million

June 8, 2015 — It takes a significant amount of financial mismanagement to land a co-op in foreclosure. Although it's a rare, and very sad, occurrence, it looks like 200 of the 329 co-ops in Community Boards 9, 10, and 11 will need to turn things around to avoid heading toward the dreaded F word. DNAinfo reports that those co-ops owe the city more than $21.2 million in unpaid taxes and water and sewage bills, citing records from the city's Department of Housing Preservation and Development (HPD), and of the 200, 49 of them owe more than $100,000. Most of the mismanaged co-ops in Hamilton Heights, Harlem, and East Harlem started out as "foreclosed properties owned by absentee landlords that the city sold to tenants to give low-income New Yorkers homeownership," according to DNAinfo. One co-op, located at 501 West 143rd Street, has a $3 million debt and at risk of being foreclosed, according to HPD. An HPD spokesperson said in statement that the co-op has been identified both by it and the Department of Finance as a candidate for the Third Party Transfer program. "If placed on the program," writes DNAinfo, "every member of the co-op would lose ownership of their apartment and be forced to become renters. For Ronaldo Kiel, who has spent more than $200,000 to buy and renovate his apartment, [it] would mean a complete loss on his investment."

Photo by Nicholas Strini for Property Shark