A Wall Street landlord has settled a lawsuit brought by its tenants over alleged rent-regulation violations.
Rockpoint Group, a Boston private equity firm, will pay a $5 million settlement to as many as 4,800 current and former tenants in two Financial District buildings, Crain’s reported.
Attorneys representing the tenants at 63 and 67 Wall Street filed a class-action lawsuit in November 2019, alleging that Rockpoint benefited from a state tax program for 14 years while offering market-rate leases. The 421-g program allows landlords to forgo property taxes, but requires them to offer rent-regulated leases.
Rockpoint’s two Financial District buildings have a total of 795 units, with rents going from $2,235 per month for a studio to $5,350 for a one-bedroom equipped with a home office.
The Rockpoint lawsuit followed a string of similar cases that have cropped up in the past 18 months. The lawsuits were filed after New York’s highest court ruled in June 2019 that because landlord Clipper Equity received the 421g tax break at 50 Murray Street, tenants in that building were legally owed rent-stabilized leases and possibly back rent.
Rockpoint has been an active investor in New York in recent years, partnering with Brooksville Company to buy Starrett City, the massive 46-building federally subsidized housing complex in East New York. The developers bought the building in 2018 for $905 million.
[Crain’s] — Georgia Kromrei