A city investigation into alleged fraud by the proprietors of Covenant House New York, a shelter for youth homeless people, is throwing a wrench into the city’s Economic Development Corporation’s effort to find a developer for a major Hell’s Kitchen project.
Covenant House was accused by a tipster to an anonymous hotline of severely inflating the number of people it serves as part of an effort to secure city funding for a new facility for the group.
The EDC put out a request for proposals (RFP) in January for a two-site, 780,000-square-foot mixed-use project on 10th Avenue at 40th Street, including 700 apartments, retail space, and a new 150,000-square-foot facility for the shelter.
Now, the agency – which has been fielding proposals for months, according to the New York Times – is tapping the brakes.
“We have learned that certain allegations have been made against Covenant House,” EDC spokesperson Anthony Hogrebe told the Times, “and we do not plan to make a developer selection until the facts are more fully known.”
A spokesperson for Covenant House said the shelter would press on regardless.
“Even if the redevelopment project does not proceed — and that is a very big if,” Marcia Horowitz told the Times, “Covenant House is moving forward with the development of a new site, and Mr. Drury is leading that effort.” [NYT] – Ariel Stulberg