Mamdani trying to force distressed building owners to sell to nonprofits — even after creditors refuse

Mayor Zohran Mamdani’s effort to place hundreds of deteriorating Manhattan flats under nonprofit ownership has stalled after creditors rejected a city-backed developer’s $110 million offer. Most of the properties failed to attract buyers at foreclosure auction, leaving the city without a publicly stated plan to secure them and raising questions about the future of affordable housing.

The buildings are part of a 38-property portfolio of about 850 flats, most rent-stabilised, which had more than 2,300 housing code violations. Fourteen of 15 East Harlem properties drew no outside buyer; most reverted to US Bank for $500 each, while one sold for $826,000 against a $1.9 million loan. A new law intended to help nonprofits buy troubled buildings will not take effect until November 2027 and does not cover court-supervised foreclosure auctions. Another 13 properties are due to go to auction on 17 November.