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De Blasio Camp Says It Was ‘Misled’ Over LES Nursing Home Sale

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Approved lifting deed restrictions without knowing the property was already in contract

45 Rivington Street
Image via PropertyShark

Members of the de Blasio administration are saying they were unaware that the nursing home building at 45 Rivington Street was already in contract to a group of developers when they removed the deed restrictions on the property, the Wall Street Journal reported.

News emerged last week that the sale of the property to a trio of developers Slate Property Group, Adam America Real Estate and China Vanke in February for $116 million was under investigation by NYC Comptroller Scott Stringer's office.

The property was owned by for-profit care provider Allure Group. Allure purchased the property in early 2015 for $28 million. A few months later they paid the city just over $16 million to take away the deed restrictions on the property, that only allowed for the space to be used as a non-profit health center. With the deed lifted, Allure went forward with its sale to the group of developers and may have pocketed as much as $72 million from it.

However news is now emerging that the property was already in contract before the de Blasio administration approved the removal of the restrictions. In fact, the administration says it entered into an agreement (not a written commitment) to ensure that part of the property would remain a nursing home, but was not aware of Allure's intention to sell the building to be converted into condos.

The developers on their part told WSJ that they had no involvement in the deed change but that the sale was contingent upon it.

The de Blasio administration now says it was misled by Allure and has asked the Department of Investigation to look into the matter.