וויליאמסבורגער בילדער שפילט אויס די שטאט
Under the Radar in Brooklyn
By WILLIAM NEUMAN
Published: September 4, 2005
ARE the city and state doing enough to protect home buyers in the midst of one of the biggest building and condo booms in years?
It's worth asking because the same Brooklyn developer that promised to build housing in Bedford Stuyvesant for teachers and then sold it as luxury condos on the open market has been moving ahead on a similar project a few blocks away, all under the noses of public officials.
For the last year, the state attorney general's office has been in talks with a group of developers that include the Brooklyn builders Mendel Brach and Moshe Oknin, over a plan to sell 63 condominiums in four new nine-story buildings on Skillman Street in Clinton Hill. What the attorney general's regulators did not know was that the developers had already promised the city to reserve the apartments for teachers, a commitment that allowed them to make the buildings more than twice the size normally allowed under zoning rules.
The condo offering, according to city officials, made no mention of this key restriction - and the attorney general's office apparently found out about it only last month, even though the information is available on the Web site of the New York City Department of Buildings.
But Skillman Street wasn't the first project of this type for the developers. On Spencer Street, in Bedford Stuyvesant, Mr. Brach and Mr. Oknin built and sold 90 condominium apartments in five supersized buildings (each nine stories high, in a neighborhood of mostly two- and three-story homes) that had initially been approved by the city with the guarantee that they would be only for teachers. Instead, they were sold on the open market, using a condo plan approved by the attorney general.
The city says it made a mistake in letting construction on Spencer Street go forward and is now refusing to grant certificates of occupancy for the buildings. That could make it difficult for the new apartment owners to refinance or sell if they want to move.
Meanwhile, on Skillman Street, the buildings are up but interior construction is still going on. Stephen Kramer, chief of staff for the Buildings Department, said the agency wants the developers to give proof that the apartments will go to teachers. That may include showing an agreement with a school saying they plan to use the units for their teachers.
But the developer appears to have another solution. Last Wednesday, a lawyer for Mr. Brach said that the developer is withdrawing the condo plan and has found a buyer for the Skillman Street buildings. The lawyer, Gary Greenwald, said Mr. Brach and his associates would finish construction before completing the sale and that the new buyer planned to use the buildings to house either teachers or students. Mr. Greenwald refused to identify the buyer or say how much the buyer was paying, but he said that none of the current owners of the Skillman Street buildings was involved with the buyer.
Jennifer Givner, the press secretary for the buildings department, said the department had been aware for some time of potential abuses of the faculty housing zoning bonus. In February 2004, department officials met with the attorney general's office to discuss the issue. They met again last October, but still, no one discovered the problems at Spencer Street and Skillman Street.
In July 2004, the buildings department received complaints about both projects, alerting officials to a potential conflict of their status as faculty housing and the condo plans. But an inspector signed off on both properties.
What all this has amounted to so far is a lot of losers and only one winner. The residents of Bedford Stuyvesant and Clinton Hill are stuck with two clusters of outsize buildings out of character with their surroundings. The owners of the 72 completed condominiums on Spencer Street are caught in an ugly limbo while the legal status of their buildings is worked out. Another 18 potential buyers are waiting to see if they will be able to close on their apartments or get their money back.
And the developers? The closed sales to date on Spencer Street have totaled more than $25 million
http://www.nytimes.com/2005/09/04/realestate/04deal.html?pagewanted=all
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