Brooklyn real estate speculator Steve Kaufman hasn’t had much luck in court lately. Last fall, city lawyers beat back his efforts to take ownership of several decrepit Manhattan apartment buildings destined for city-funded rehabs. Then, early this year, he was sued by 125 Brooklyn tenants who allege that he evicted them in order to profit from city contracts to house the homeless.
Finally, City Limits has learned, Kaufman several weeks ago quietly withdrew a lawsuit that had been blocking the federal government from handing over a troubled Brooklyn housing project to a nonprofit-tenant development team.
Now that Kaufman has backed off his claim that he is the rightful owner of Medgar Evers Houses in Bedford-Stuyvesant, the federal department of Housing and Urban Development is quickly moving to finish its deal and transfer the project. Closing is scheduled for May.
“Justice prevails,” said Carol Lamberg, executive director of the Settlement Housing Fund, which along with the Community Service Society, Long Life Information and Referral Network and the tenant associations of both Medgar Evers and its sister project, the Dr. Betty Shabazz Complex, will soon be the new owners of the sprawling development that includes 11 buildings and 465 apartments — plus a storied gym, the Bed-Stuy Boxing Center.
The new owners, who’ve put together funding from HUD grants, Section 8 vouchers, and loans from banks and the city Housing Development Corporation, will soon begin a full rehabilitation of the 30-year-old project. The nonprofits and tenants plan to maintain the Medgar Evers and Shabazz apartments as affordable housing — and also to add an array of social and educational services.
Last April, Kaufman filed a lawsuit in Eastern District Court claiming that his $14 million offer for the Medgar Evers Houses at a federal auction should have been accepted as the winning bid — a claim HUD disputed. The disagreement was heading to a hearing when, on February 7, Kaufman suddenly withdrew his action. Fifteen days later, Judge Nicholas Garaufis endorsed a dismissal agreement.
“In the global scheme of things, I felt it just wasn’t right,” said Kaufman of his lawsuit. “I folded my cards and walked away.”
Kaufman still has other legal business to attend to, though. Currently pending is a suit that the Legal Aid Society filed in January on behalf of 125 former tenants of the Noble Drew Ali complex in East New York. The families allege that Kaufman and his company Eshel Management evicted them in order to free up apartments for a Department of Homeless Services program that pays Eshel $95 a night in rent. In March, a judge granted Legal Aid a preliminary injunction that prevents Kaufman from evicting any additional tenants, or renting any additional units to DHS, until the full case can be heard.
That suit follows on the heels of yet another effort by Kaufman to hone in on a government housing program — in several separate legal actions, state judges in the fall of 2002 dismissed his efforts to take over six different troubled northern Manhattan properties that the city department of Housing Preservation and Development was looking to put into its third party transfer program.