Lobbyist gets city to OK turning an AIDS nursing home into luxury condos—then gives Mayor de Blasio $50,000

Lobbyist who steered $50,000 to Mayor de Blasio turned AIDS nursing home into luxury condos

By GREG B. SMITH

A powerful lobbyist steered $50,000 in donations to Mayor de Blasio after pressing the city for a deed change that allows one of his clients to turn a building restricted for use as a nursing home into luxury condos.

Since October lobbyist James Capalino has collected $40,000 in checks for de Blasio’s 2017 re-election bid and personally wrote a $10,000 check in May to Campaign for One New York, the non-profit de Blasio uses to promote his causes. 

Capalino represented both the original seller of the nursing home at 45 Rivington St. on the Lower East Side and the developer who will turn it into luxury condos.

On Friday the city said they were misled by a middleman in the transaction, a deal which is now being scrutinized by city Controller Scott Stringer. Stringer’s involvement was first reported by the Wall Street Journal. 

In January 2014 Capalino was hired by the building’s owner, VillageCare, which had operated an AIDS-care facility there for years. VillageCare needed to sell the building to generate cash.

Capalino “met with DCAS (Department of Citywide Administrative Services) employees and others” three times between February and July 2014. Officials declined to say whether the “others” worked in the mayor’s office.

He also sent a Feb. 19, 2014 letter to former DCAS Commissioner Stacey Cumberbatch “regarding a potential sale of the Rivington House property without the deed restrictions imposed by the City.”

Capalino said VillageCare preferred selling to a for-profit nursing home but was also considering making “an unrestricted sale for the ‘highest and best use.’”

In February 2015, VillageCare sold the building for $28 million to a nursing home operator called the Allure Group, which assured the city they’d run a for-profit home there, officials said.

At the time, the deed restriction was still in place. Then in April 2015, Manhattan-based condo developer Slate Acquisitions hired Capalino.

Risa Heller, a spokeswoman for Capalino, says Capalino “did not represent Slate on this transaction,” but on May 11, six weeks after Slate hired Capalino, Slate went to contract to buy 45 Rivington from Allure Group.

DCAS soon agreed to lift the nursing home restriction, and on Nov. 11, Allure paid the city a $16.1 million fee and was awarded a modified deed with no restrictions. 

Three months later, Allure fulfilled its May 11 contract of sale and sold the building for $116 million to Slate and their newly revealed partners, China Vanke Co. and Adam America Real Estate.

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