Judge Approves Sale Of Starrett City Complex That Nets Trump $36M Profit
The sale of the largest federally subsidized affordable housing complex in the country will move forward after a judge's approval.
New York State Supreme Court Judge Saliann Scarpulla ruled in favor of Starrett City Partners, an association of investors including President Donald Trump, finding that its $905M sale of the complex to a joint venture of Brooksville Co. and Rockpoint Group is legal, the New York Times reports.
A minority group within Starrett City Partners, including Belveron Partners and some descendants of the complex's developer, Disque Deane, sued to block the sale. The group alleged that no bidding process had taken place and SCP Managing Partner Carol Deane, Disque's wife at the time of his death, failed to notify them and refused subsequent, higher offers from a joint venture of Belveron and LIHC Investment Group.
Court documents showed that Carol Deane enlisted broker Douglas Harmon, then of Eastdil Secured, now with Cushman & Wakefield, in deciding the best route of sale, and he recommended picking a buyer rather than opening up the process to bids. The initial sale price of $850M, which prompted the lawsuit, has since been increased to $905M, $5M more than the price Belveron and LIHC offered after SCP went under contract with Brooksville and Rockpoint.
After Scarpulla's ruling, the sale still needs the approval of state officials and the Department of Housing and Urban Development, led by Trump appointee Secretary Ben Carson. Trump owns 4% of Starrett City, meaning he stands to personally profit by $36M from the sale. His involvement in the complex is the subject of a congressional investigation.