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

Mayor Zohran Mamdani’s effort to steer hundreds of deteriorating Manhattan apartments into nonprofit ownership has hit a wall — after creditors rejected a $110 million offer from a city-backed developer and pushed the buildings into foreclosure auctions.And despite City Hall insisting the fight isn’t over, the administration has yet to publicly explain how it plans to salvage the deal.At Tuesday’s auction, 14 of 15 East Harlem apartment buildings failed to attract outside buyers, with most reverting to plaintiff US Bank National Association for nominal bids of $500 apiece.One went for $1,000.The only building to draw an outside bidder, at 417 E.

114th St., sold for $826,000 — just $1,000 above the minimum bid and far below its original $1.9 million loan.The properties are part of a troubled 38-building portfolio containing roughly 850 apartments, most of them rent-stabilized, that was previously owned by Emerald Equity Group.The buildings had accumulated more than 2,300 housing code violations when the city became involved earlier this year, raising concerns about deteriorating living conditions and the future of desperately needed affordable housing.Mamdani’s administration had backed affordable housing developer Spatial Equity in its attempt to purchase the portfolio, with tenant advocates hoping the properties would eventually be transferred to the nonprofit East Harlem El Barrio Community Land Trust.The Post previously reported that Spatial Equity was seeking to evict eight tenants from a separate Brooklyn housing complex, even as the administration backed its bid for the East Harlem properties.The developer initially offered $68 million before raising its bid to $110 million last month.Creditors rejected both offers, and the properties proceeded to foreclosure.The setback came on the very day Mamdani signed the Community Opportunity to Purchase Act, or COPA, a law intended to give qualifying nonprofit housing organizations a better shot at buying ...