Like many big landlords with credit to burn during the real estate boom, the Pinnacle Group and Praedium Group teamed up to buy a bunch of buildings filled with rent-stabilized tenants, the aim being to somehow convert those apartments to higher-priced market rates. And just like at Stuy Town and other similar properties, those conversions didn't happen quickly enough, creating foreclosure fallout. BOR-ING. But here's where things get spicy: The Wall Street Journal reports that the partnership is exploring a plan to convert 1,000 rental apartments in 36 buildings on the Upper West Side to condos. That's one way to make good on your debts, and to cause inventory watchers like Jonathan Miller to have a heart attack.
Of course there are issues with this plan, such as the tenants, a group of whom are suing the landlords for "illegal, fraudulent, and harassing practices" to inflate rents. Well sheesh, the companies promised lenders they'd be able to triple average rents in the buildings (like 894 Riverside Drive, seen at right) by 2012, so how else were they supposed to accomplish that, with candy and flowers? Sometimes people just don't get it.
· Owners Ready More Rentals for Condo Status [WSJ]