Pinnacale-- and the Sacking of Manhattanville
[A knowledgeable friend sends along the following (below) about Pinnacle which looks to be another of our all too typical brutal American corporate real estate operations that exploits the weak for the financial benefit of the all too well off. I cannot say how appalled I am by such things, as one trained in property theory by Columbia's best (Ernest Nagel, University Professor in Philosophy, and Harry Jones, Cardozo Professor of Jurisprudence at the Law School). I think either, were he alive today, would also have some strong things to say about Columbia's move on Manhattanville and the pain that it is causing residents, workers, and businesses in that general area.
I gather that the Piers project down there, which will provide a pleasant riverside vista for the proposed Columbia biotek operation designed to front on it, is also being sacked of valuable historical materials by the inaction or complicity of a city agency -- again exploitation that would never be tolerated outside of a minority community locale. Perhaps the Spectator might want to do a follow up on its recent Piers article on the rape of the valuable materials being removed from that project despite Community Board #9 protests?
Frankly the Piers project looks to be yet another scrap from the table for Harlem along the lines of the park on the top of the North River Treatment (non-functional) sewer plant, which should have been located far down the Upper West Side. Its 'unique' plant design permits only partial treatment of sewage at best and when heavy rains flood the sewers, only solids are removed from wastes being dumped into the river where unwary persons are permitted to catch fish polluted with mercury and other toxic materials.
This is the way that things are done here in NYC -- pace Robert Moses the mastermind of such class-ridden urban and land planning. The name of his game was replacing poor folks with playgrounds for the rich:
http://en.wikipedia.org/wiki/Robert_Moses
Manhattanville looks to be a Moses repeat with slick Columbia pr and political manipulation thrown in to quiet the displaced? Ray Jones, New York's most powerful pol in his day, known as the "Harlem Fox," had strong things to say about getting Harlem "off the plantation," which he directed to a previous generation of sellout Harlem pols before he brought in as their replacements such as David Dinkins, Charlie Rangel, and others who represented the community rather than outside money interests.
Ed Kent]
.....................................
Comment on Pinnacle by a knowledgeable legal expert on such things in response to my query --
The answer is yes, but interestingly their game is not to run the buildings down through neglect. Violations are repaired en masse, so it is not a group that I would get involved in, but in the old days the Weiners of Brooklyn were slow to do repairs.
Pinnacle is the focus of investigation now because of their zeal in trying to pump up rents to over $ 2,000/month so that they become "luxury" de-controlled apartments. The allegation now is that they have padded bills to obtain major capital improvements (m.c.i.'s) in order to reach that numerical goal. This mass falsification of billing coupled with numerous frivolous eviction proceedings is the focus of Spitzer's investigation, something that would not have been necessary if the Pataki run Department of Housing & Community Renewal's enforcement division had been looking at this from the beginning. Perhaps more interesting is how Pinnacle is capitalized.
As I said, for a long time the Weiners were sort of middling operators in Flatbush, nothing too good or too bad. What they caught on to was the way to collateralize holdings, i.e. Enron in real estate. According to Heather Haddon, who first uncovered the story with a Bronx Community paper, there are doctors and even a mid-west union welfare fund that own a piece of Pinnacle. As the Rent Stabilization Laws are supposed to bring about at least a 5% rate of return on investment, marginal property, once you fix it up and get the low paying, long term tenants out, becomes a nice return on investment. Perhaps there are initial losses for the first few years as there are massive costs to remove violations, upgrade certain apartments, and hire attorneys to evict those you want to evict, so while I haven't looked at their business plan, I once theorized to Haddon, that one would see a negative cash flow as an investor for the first few years. But after that, what happens if the market cools and the asset doesn't appreciate at the rate people have become accustomed to over the past several years? Is there a drastic fall ahead that no one is anticipating? As I said, I fear that in this super heated, but cooling real estate market, Pinnacle is an example of Enron in multiple dwellings. Once the credit line of investment from amateurs runs out, does the Pinnacle Empire collapse? Good question.
--
"A war is just if there is no alternative, and the resort to arms is legitimate if they represent your last hope." (Livy cited by Machiavelli)
--
Ed Kent 718-951-5324 (voice mail only) [blind copies]
http://groups.yahoo.com/group/EndingPoverty
http://BlogByEdKent.blogspot.com/
http://www.bloggernews.net
I gather that the Piers project down there, which will provide a pleasant riverside vista for the proposed Columbia biotek operation designed to front on it, is also being sacked of valuable historical materials by the inaction or complicity of a city agency -- again exploitation that would never be tolerated outside of a minority community locale. Perhaps the Spectator might want to do a follow up on its recent Piers article on the rape of the valuable materials being removed from that project despite Community Board #9 protests?
Frankly the Piers project looks to be yet another scrap from the table for Harlem along the lines of the park on the top of the North River Treatment (non-functional) sewer plant, which should have been located far down the Upper West Side. Its 'unique' plant design permits only partial treatment of sewage at best and when heavy rains flood the sewers, only solids are removed from wastes being dumped into the river where unwary persons are permitted to catch fish polluted with mercury and other toxic materials.
This is the way that things are done here in NYC -- pace Robert Moses the mastermind of such class-ridden urban and land planning. The name of his game was replacing poor folks with playgrounds for the rich:
http://en.wikipedia.org/wiki/Robert_Moses
Manhattanville looks to be a Moses repeat with slick Columbia pr and political manipulation thrown in to quiet the displaced? Ray Jones, New York's most powerful pol in his day, known as the "Harlem Fox," had strong things to say about getting Harlem "off the plantation," which he directed to a previous generation of sellout Harlem pols before he brought in as their replacements such as David Dinkins, Charlie Rangel, and others who represented the community rather than outside money interests.
Ed Kent]
.....................................
Comment on Pinnacle by a knowledgeable legal expert on such things in response to my query --
The answer is yes, but interestingly their game is not to run the buildings down through neglect. Violations are repaired en masse, so it is not a group that I would get involved in, but in the old days the Weiners of Brooklyn were slow to do repairs.
Pinnacle is the focus of investigation now because of their zeal in trying to pump up rents to over $ 2,000/month so that they become "luxury" de-controlled apartments. The allegation now is that they have padded bills to obtain major capital improvements (m.c.i.'s) in order to reach that numerical goal. This mass falsification of billing coupled with numerous frivolous eviction proceedings is the focus of Spitzer's investigation, something that would not have been necessary if the Pataki run Department of Housing & Community Renewal's enforcement division had been looking at this from the beginning. Perhaps more interesting is how Pinnacle is capitalized.
As I said, for a long time the Weiners were sort of middling operators in Flatbush, nothing too good or too bad. What they caught on to was the way to collateralize holdings, i.e. Enron in real estate. According to Heather Haddon, who first uncovered the story with a Bronx Community paper, there are doctors and even a mid-west union welfare fund that own a piece of Pinnacle. As the Rent Stabilization Laws are supposed to bring about at least a 5% rate of return on investment, marginal property, once you fix it up and get the low paying, long term tenants out, becomes a nice return on investment. Perhaps there are initial losses for the first few years as there are massive costs to remove violations, upgrade certain apartments, and hire attorneys to evict those you want to evict, so while I haven't looked at their business plan, I once theorized to Haddon, that one would see a negative cash flow as an investor for the first few years. But after that, what happens if the market cools and the asset doesn't appreciate at the rate people have become accustomed to over the past several years? Is there a drastic fall ahead that no one is anticipating? As I said, I fear that in this super heated, but cooling real estate market, Pinnacle is an example of Enron in multiple dwellings. Once the credit line of investment from amateurs runs out, does the Pinnacle Empire collapse? Good question.
--
"A war is just if there is no alternative, and the resort to arms is legitimate if they represent your last hope." (Livy cited by Machiavelli)
--
Ed Kent 718-951-5324 (voice mail only) [blind copies]
http://groups.yahoo.com/group/EndingPoverty
http://BlogByEdKent.blogspot.com/
http://www.bloggernews.net
posted by Ed Kent at 7:37 AM
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