Mamdani Claims Win Despite Defeat in Pinnacle Auction

17 January 2026

The bankruptcy auction of Pinnacle’s 5,141-unit, Brooklyn-Manhattan portfolio so perfectly encapsulates the madness of rent stabilization in New York — and the politics of Mayor Zohran Mamdani — that I could write a book about it.

But in the interest of urgency, below are some quick thoughts on Summit USA’s winning bid of $451.3 million.

Let’s start with this statement by the mayor’s deputy mayor for housing, Leila Bozorg: “Thanks to our intervention and dedicated organizing by tenants, the new owner of these buildings has committed to invest $30 million and to cure all violations within six months.”

Is that spin? Of course it’s spin. Here’s why:

Summit’s Zohar Levy said he’d spend $30 million over five years for repairs and maintenance. That’s $97 per unit, per month. One owner of rent-stabilized buildings recently said he budgets $75 per month for maintenance. Levy pledged just $22 more to fix these supposedly decrepit properties. In the immortal words of Derrick Coleman, whoop-de-damn-doo.
Levy says it will only cost $10 million to clear all the violations within six months and the capex backlog within one year. His maintenance budget for years two through five is $81 per unit, per month. That’s a typical maintenance budget — and the “commitment” that Mamdani took credit for is not even legally enforceable.
Only 420 units — 8 percent of the portfolio — account for all of the violations. These may be the units with tenants who like to call 311, or who have been recruited by Mamdani’s head of tenant protection, Cea Weaver.
The Mamdani administration had claimed the buildings were in horrendous shape. But 92 percent of the units have no violations.
Given that Weaver has spent years recruiting tenants in Pinnacle’s buildings to fight the landlord, it’s surprising that only 1 in 12 units has a violation. Perhaps she told Mamdani the buildings were in worse shape than they actually were.
Levy says the only thing he needs from the Mamdani administration is help persuading tenants to let repair crews enter their units. If Mamdani agreed to this, I missed it. Perhaps the mayor doesn’t want to say in public that tenants can and do refuse access.
If cash flow proves insufficient, Levy says, he will get bridge loans and/or equity infusions to make up the shortfall. Flagstar says it will provide a $3 million line of credit. Not really worthy of a Mamdani victory lap.

Now, on to the bigger picture. What does the saga say about the rent stabilization system?

Summit’s $451.3 million bid works out to $87,614 per unit, which Mamdani argued was too much. He admitted that these buildings have little value, contradicting his narrative that their landlords are rolling in dough.
The median sale price of Brooklyn apartments last quarter was $840,000. If units discounted by 90 percent are not cheap enough for tenants, as the mayor said, the solution is probably not a larger discount. It’s creating a functional housing market, where homes are not either extremely expensive or nearly worthless.
Flagstar, the lender that took a bath on the Pinnacle portfolio’s $564 million mortgage, is also the lender on Summit’s purchase. Flagstar’s $338.5 million loan covers 75 percent of the purchase price. The lender, formerly New York Community Bank, is ripping off the Band-Aid on its bad loans to rent-stabilized buildings.

In politics, after losing a battle like this, the best thing to do is declare victory and move on — and if you can, turn people’s attention to something else. Which is what Mamdani did.
On Friday, he announced a $2.1 million (aka not very big) settlement reached by the Adams administration with the giant landlord A & E. Was the timing a coincidence? There are no coincidences in politics.