David Brand: What are you dealing with now?

Mildred Ross: We're dealing with repairs not being done, improper heating, and the building's not being cleaned. We can't even get in touch with the landlord now-- [crosstalk]

Janae Pierre: This is Mildred Ross. She lives in a rent-stabilized apartment in Brooklyn. The company that owned her building is the Pinnacle Group, once one of the largest owners of rent-stabilized housing in New York City. Mildred says before, when she had a problem, she could call and get help, but things have deteriorated over the years. Pinnacle is now in bankruptcy, and thousands of apartments like Mildred's are part of a court-approved sale.

Mildred Ross: We used to be able to get in touch with them, but since the bankruptcy, they're not doing that anymore because, yes, I think they don't want to hear their tenants, so they put up an answering service. You call in for a repair or whatever, it's they're not even answering you.

Janae Pierre: Now, tenants like Mildred have questions about what living under the new owner will actually look like.

[MUSIC - NYC Now: Intro]

Janae Pierre: From WNYC, this is NYC Now. I'm Janae Pierre. You may have seen the headlines about this one: a major New York City landlord collapsing into bankruptcy, more than 5,100 rent-stabilized apartments changing hands, and questions about what the city can do when that kind of deal moves through the courts. At the center of it is the Pinnacle Group, once one of the largest owners of rent-stabilized housing in the city. After years of financial trouble and a glut of housing violations for unsafe living conditions, the company ended up in bankruptcy, and a judge has now approved the sale of its buildings to a new owner, who public advocate Jumaane Williams just named on his annual "Worst Landlords" list.

The real reason the deal drew so much attention is because, hours after Mayor Zohran Mamdani was inaugurated on the steps of City Hall on January 1st, he showed up at a Pinnacle building in Flatbush, Brooklyn. He had his newly-appointed head of tenant protection by his side, Cea Weaver, and he made the bankruptcy sale his first big act as mayor, who promised to make living conditions better for tenants.

What actually happened here? How did we get to this point? And what does this battle over the sale tell us about the limits of city power when big landlords unwind through bankruptcy? WNYC's Housing Reporter, David Brand, has been covering this one really closely. This sale is moving forward. Thousands of rent-stabilized apartments are set to change hands through bankruptcy court. David, on a scale of 1 to 10, how big of a deal is this?

David Brand: Well, scale of 1 to 10, I would say it's like a 9 or a 10, because there's a lot going on here. This has come to represent a lot of bigger themes when it comes to New York City housing policy and the role of government and regulations when it comes to rent-stabilized apartments, but then it also represents Mayor Mamdani's core campaign pledges of holding landlords accountable, of making life and living conditions better for tenants, and, as you mentioned, his very first day in office, a few hours after his inauguration, he goes to one of these Pinnacle buildings in Brooklyn and says the city is stepping in and stepping up for renters.

Janae Pierre: Yes, and that's a really big deal. I need you to help me understand something. How did Pinnacle build an operation this big and get into so much financial trouble in the first place?

David Brand: Well, let's step back and look at the real estate market at the time that Pinnacle started buying up a lot of rent-stabilized apartments, and I mean tens of thousands. The laws back then allowed landlords to raise rents on vacant, rent-stabilized apartments. It was called a "vacancy bonus," and they could increase rent by 20% every time an apartment became vacant. They could increase rents based on individual apartment improvements called IAIs, so another way to increase rent, after you did some work in the apartment, or if you did renovations of the whole building, major capital improvements.

All of these things combined to allow owners to increase the rents, and then if rents hit a certain threshold, they can then pull those units out of rent-stabilization. A lot of property owners at the time were doing that, and it allowed them to just raise rents to market value, and made these very lucrative.

Janae Pierre: They were doing this legally?

David Brand: Yes, this was totally okay under state law, but those laws were very controversial because they incentivized bad behavior by landlords as well. There's a lot of money at stake. If you drove out a long-term tenant, you could automatically increase the rent by 20%, and so we saw in that time that a lot of bad actors were harassing tenants to get them to leave so that they could increase rent. That was happening a lot. That was pretty common, and even Pinnacle reached a settlement with the state over tenant harassment claims.

Janae Pierre: Why are rent-stabilized apartments so central to their strategy here?

David Brand: Well, I think the first reason is that there's so many of them. There's more than 1 million across the city, and 20 years ago, there were even more, but some number of those, more than 100,000, were actually taken out of the rent-stabilization system, so there was that potential for dramatic rent increases over time. Every time a unit opened up, you can increase the rent. If you did work in the unit, you could raise the rent even more.

Then there's another reason. Many of these apartments were in gentrifying neighborhoods. You think Northern and Central Brooklyn, Harlem, Western Queens, like Sunnyside and Astoria, where you could attract higher-paying renters as well as investors willing to pay a lot for these buildings, knowing that, under the laws at the time, they could increase rents by a higher amount.

Janae Pierre: All right, so at its peak, how many apartments did Pinnacle own in New York City?

David Brand: Well, I was looking back at a Bloomberg article from 2017, and they said, in 2017, Pinnacle owned about 10,000 apartments, but in the early 2000s, they owned like 20,000 before they started selling off some of them. It made them one of the largest landlords in the city, and, for a while, their strategy of buying these buildings with rent-stabilized apartments, increasing rents really worked. Their CEO, Joel Wiener, became a billionaire, maybe, about 10 years ago.

Janae Pierre: Wow, so what changed, David? How did we get here?

David Brand: Well, back in 2019, Democrats won control of the State Senate as well as the State Assembly, and they vowed to take up these strong tenant protection measures to stop landlords from taking apartments out of rent-stabilization, or to prevent landlords from raising rents by 20% on vacant apartments, or to even decrease the amount that they could raise rent after doing these individual apartment improvements, repairs, and renovations to the buildings.

Their justification was, "Look, over the last 20 or 25 years, so many apartments have been taken out of rent-stabilization. The laws have incentivized landlords to drive out long-term tenants so that they can increase rents. We're going to close all of these loopholes to keep apartments rent-stabilized and to keep a more steady rate of increase based on what the Rent Guidelines Board sets." They enacted these new laws in 2019. Suddenly, if you're a company, you took out these hefty loans that required you to raise rents in order to pay back the lender and also make repairs and handle everyday maintenance at the buildings, your business model is upended because you can't raise rents anymore, and so you're in financial trouble.

Janae Pierre: And at the top, I mentioned Cea Weaver. Can we talk about the role that she played back in 2019?

David Brand: Back in 2019, Democrats took control of the State Senate. They had long held the State Assembly. When they came into office, they vowed to change the tenant protection laws, and one person really driving that movement to make the tenant protection laws stronger and to prevent landlords from raising rents on empty apartments was Cea Weaver. She was a Tenant Organizer then with an organization called Housing Justice for All. She really knew how to organize tenants and also work the backroom with policymakers and politicians to get these rent laws passed, and they did.

Janae Pierre: It's no surprise that she's working with Mayor Mamdani in the office to protect tenants?

David Brand: Right. On his first day in office, Mamdani named Cea Weaver his director of the newly-revitalized Mayor's Office to protect tenants. It's this office within City Hall that's going to be tasked with holding bad landlords accountable and coming up with ways to transfer buildings from landlords who are racking up a lot of violations or who, like in the case of Pinnacle, aren't able to pay their loans and aren't able to keep up with maintenance and repairs in their building. It was pretty clear he was going to appoint her to either that role or something pretty high up in City Hall because she was his main housing advisor. They became close after he became an Assembly member. I think he learned a lot of housing policy from her, and on that very first day, he appointed her to lead this office.

[MUSIC - NYC Now: Interlude]

Janae Pierre: Still ahead, what this sale means for tenants now living under a new owner, why the mayor tried to intervene and why it didn't work, and what this case reveals about the limits of city power once housing deals move through bankruptcy court. Stay with us.

[MUSIC - NYC Now: Interlude]

Janae Pierre: Welcome back. Before the break, we walked through how Pinnacle built its empire and how that business model collapsed. David, the story picks up again in 2025, right?

David Brand: That's right, all the way back. 2025.

Janae Pierre: Oh, so far away. Tell us what happened.

David Brand: Pinnacle was struggling to pay back its loans to its lender, Flagstar Bank, and as we know, they were also not able to keep up on repairs and maintenance in this huge portfolio of buildings they own. They were racking up thousands of Housing Code violations. At the start of 2025, they defaulted on their loans, so Flagstar, the lender, started the foreclosure process. To forestall that, Pinnacle declared bankruptcy in May of 2025, and that's an accelerated, more efficient process for selling off these properties. That's what came to a head last month in December when a new buyer lined up a bid for this huge 90-some building portfolio.

This other company, Summit, steps in and says, "We're going to place a $451-million bid for these properties." Summit ended up winning the auction, and that's what the city tried to intervene to stop the sale or at least to slow it down, to say, "Maybe we could come up with an even higher bid, or we could give low-interest loans to a nonprofit or another private entity that'll work with us to get these buildings back up to shape, to guarantee tenant protections, and to address all these thousands of violations." That's what Mamdani stepped in to try to do. It didn't work the way he had planned.

Janae Pierre: Yes. I can't help but think about tenants in this situation. What are the consequences for them?

David Brand: You're absolutely right, tenants are extremely important in this situation because they're the ones who are actually living in these buildings where conditions are deteriorating, where there's vermin infestations, rats, and roaches. Their ceilings are crumbling. There's problems with their flooring. In at least two of the buildings, Pinnacle stopped paying their Con Ed bill, so the lights were out in the common areas. Back in May, tenant associations from dozens of Pinnacle buildings across the city united into one organization called the Union of Pinnacle Tenants. Their goal was to try to slow a bankruptcy sale and to have a say in who the buyer would be. There wasn't one clear goal of, "We want this specific company or this nonprofit take over." Instead, they said, "We want to work with the city to see what's possible."

Janae Pierre: Tell me about Summit Properties. They just swooped on in and bought everything?

David Brand: Yes, pretty much. Summit worked with the lender and with Pinnacle on this deal, so that the lender said, "Okay, we're going to cut $275 million in debt. You can take over the buildings." The thing is, Summit already owns property in New York City. They partnered with these companies called Chestnut Holdings and Denali Management to purchase and manage 90 buildings, mostly in the Bronx, back in 2021 and 2022. Tenants in those buildings have been complaining about management and ownership for years.

Executives from those companies, Chestnut and Denali, have appeared on the city's Worst Landlord list repeatedly. Last year, I had done a story on how the city was transferring property from an owner in the Bronx who owed tens of millions of dollars in unpaid property taxes and unpaid violations, and the city used this program to move that building to who they termed "a more responsible owner." A couple of days later, Mamdani, inspired by that story, held a press conference outside another building in the Bronx and said, "If I'm elected, we're going to do more of that." The building he chose to do that was actually a Summit building.

People didn't really realize that at the time because all of the property records and the financial records identified these other companies, Chestnut and Denali, but it turns out that building, back then, was a Summit building. It shows this company has a track record, and it's not good, and that is what has worried tenants and worried the Mamdani-Administration city officials as well.

Janae Pierre: David, it's time for you to drop that bomb, because I know that you found another connection between Chestnut, Denali, and Summit, right?

David Brand: That's right, and this was really interesting. Chestnut and Denali are both owned by a guy named Jonathan Wiener.

Janae Pierre: Wait, Wiener? Like Joel Wiener?

David Brand: Exactly like Joel Wiener. Stay with me here.

Janae Pierre: Okay.

David Brand: I found that Jonathan Wiener and executives from his companies, Chestnut and Denali, signed over 80 deeds for buildings owned by Summit, and Jonathan Wiener is the brother of Joel Wiener, the Pinnacle CEO.

Janae Pierre: No way. No way.

David Brand: Small world of New York City real estate. Tenants, the city, and even Attorney General Letitia James actually questioned whether, "Is it a small world or is there something fishy going on here?" And whether this is an insider relationship. That, did Pinnacle declare bankruptcy as a maneuver to try to steer the properties to Summit, which they're also involved with?

Janae Pierre: Yes. Am I my brother's keeper?

David Brand: Exactly, and that was the concern. Summit and its attorneys said, "No, that's absolutely not the case." Their CEO, Zohar Levy, testified in court, saying he didn't know the properties were in such a bad state, and he swore that Jonathan Wiener has nothing to do with the buildings that he's purchasing, that his companies are not going to own or manage these new Pinnacle buildings that Summit is purchasing.

During the court hearing, a judge said this was a very legitimate line of questioning. This does smell weird. I think his quote was that, "The seeming proximity was raising a lot of eyebrows."-

Janae Pierre: You see mine?

David Brand: [chuckles] -but the judge did say that he thought Summit and Zohar Levy, their CEO, had proven that Chestnut and Denali won't be involved, so maybe this was just a coincidence.

Janae Pierre: All right, so we know that after taking office, Mayor Mamdani tries to intervene in all of this. It didn't work out the way that he wanted. My question for you, as we wrap up, what does this mean for Mayor Mamdani and his pledge to hold landlords accountable?

David Brand: Well, that's what I'm going to be paying attention to, moving forward here. There's no doubt this is a setback for Mamdani. His very first day in office, he says, "We're going to set a precedent here for how to intervene in a bankruptcy case through the City Law Department. Didn't work out quite the way they wanted to, the judge said no, the sale is going through, but they are framing this as a win in a way, and so are the tenants, because they're saying, "Look, if it wasn't for our intervention and if it wasn't for all of this organizing the tenants had been doing for many months, then Summit probably never would have promised in court documents to fix half the violations in 2 months and then the other half in 6 months, and they also discussed this $30 million plan to make repairs and address the thousands of violations across this portfolio."

They say, "Look, we didn't get exactly what we wanted, but we got this stuff on the record that they say they're going to do." I think they're going to try to use this case as a blueprint or learning experience for what they're going to do for landlords in similar situations. We talked about, earlier, how a lot of property owners are in similar financial straits here because they have these loans they can't handle based on current rents, they're letting their properties fall into disrepair, neglecting tenants, neglecting the problems in their properties.

Probably going to be more opportunities for the city to intervene again, and this time, they're going to have more time. By the time Mamdani came into office and said, "We're going to intervene," it was already eight months after the bankruptcy process started, the new buyer, Summit, had already made their bid back in December, about a week-and-a-half before Mamdani took office. Be interesting to see what the city does if they intervene from the very beginning to try to steer these deals and these purchases.

Janae Pierre: Yes. Please keep us posted, David.

David Brand: Well, this is a big deal, so I think we'll be talking about this again.

Janae Pierre: That's WNYC's housing reporter, David Brand.

David Brand: Thanks, Janae.

Janae Pierre: Thanks a lot. Thank you for listening to NYC Now. I'm Janae Pierre. See you soon.

[MUSIC - NYC Now: Outro]

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