New York City Mayor Zohran Mamdani (D) suffered an early and very public setback after a federal judge approved the sale of more than 5,000 New York City apartments to a large real estate firm, despite his administration’s intense opposition.
The $451 million transaction allows a Summit Properties subsidiary to acquire thousands of units previously owned by the bankrupt Pinnacle Group, a landlord long accused by tenants of neglect, unsafe conditions, and widespread housing violations.
The ruling delivers a blow to Mamdani’s tenant-first agenda, which he highlighted from his first day in office as a central promise of his administration and a defining theme of his political rise.
Just hours after his inauguration on Jan. 1, Mamdani personally toured a Pinnacle-owned building in Brooklyn, listening to residents describe leaking ceilings, mold, crumbling tiles, and infestations that had gone unaddressed for years.
The mayor’s office moved aggressively to block both the auction of the properties and the final sale, arguing that Summit had its own troubling record as a landlord with thousands of unresolved code violations.
City and state officials warned that transferring the apartments to another heavily cited firm would do little to improve living conditions and could deepen long-term problems for mostly rent-stabilized tenants.
Those concerns were echoed by the New York attorney general’s office, which pointed out that Summit’s existing portfolio includes more than 4,000 open violations across roughly 90 buildings purchased in recent years.
Despite the objections, U.S. Bankruptcy Judge David S. Jones ruled that the sale could proceed, citing Summit’s plan to inject capital, hire experienced managers, and address violations on a defined timeline.
Judge Jones acknowledged that critics raised serious issues but said he was persuaded that Summit presented a credible strategy to stabilize the properties and complete long-delayed repairs, per the New York Times.
During tense court proceedings, city lawyers urged the judge to delay the deal, saying they needed more time to review Summit’s finances and feared the company had underfunded repair commitments.
Summit executives countered that the city was engaging in speculation, insisting the firm had both the resources and intent to improve conditions quickly.
Summit’s chief executive testified that half of all violations would be resolved within 60 days of closing, with the remainder fixed within six months of the purchase.
Following the ruling, city officials claimed partial credit, saying their intervention forced Summit to commit at least $30 million toward repairs within six months.
Still, the outcome raises questions about Mamdani’s ability to translate activist energy and campaign promises into concrete victories when confronted with federal courts and entrenched real estate interests.
For tenants who had hoped the new mayor could stop the sale outright, the decision underscored the limits of political will when it collides with bankruptcy law and powerful landlords.
