Famed Riverton Houses to be sold at foreclosure

February 3, 2010 3:50:57 PM PST
It's a sad day in Harlem for a historic housing complex. The Riverton Houses was ordered by a judge to be sold at foreclosure. The 13-building campus has been home to many famous residents over the years. So what happens to the tenants?

Grant Reid grew up in the Riverton Houses, and his mother still lives there.

"It was like the place to be," he said. "It has a great history here."

Indeed the private residential development has been a middle class enclave since the 1940s. Jazz musician Billy Talyor and former Mayor David Dinkins have called Riverton home. It was built by MetLife Insurance in response to criticism over its whites-only policy at Stuyvesant Town and Peter Cooper Village. Like those complexes, Riverton was sold to developers for big bucks. Now, it has now gone into foreclosure.

"This is the ultimate high-profile housing bubble collapse," said Harold Shultz, of the Citizens Housing and Planning Council. "This is the multiple-dwelling equivalent of sub-prime loans."

Like Stuy Town, the plan was to renovate apartments and raise non-rent controlled units to market rates, but the market dried up.

"Everybody was trying to get what they could from the market," Tenants Association member Robert Toussaint said. "As they say, greed will make you bleed."

Under a court order, Riverton will be auctioned off to the highest bidder next month. Though many residents are still protected by rent control laws, there is concern over who the new owner will be.

"Is somebody going to buy this who thinks I can own this for a couple years, the rents will go up, the value of the property will go up, and I will be able to flip it," Shultz said.

Housing advocates say another concern is whether the new owner will be experienced enough to run a complex with seven buildings and 1,200 units. It is no easy task at a place with a storied history and now an uncertain future.