Landlord battles Sentinel over alleged rent-regulation fraud
NYC landlord locked in legal fight with Sentinel Real Estate over alleged scheme to inflate value of Washington Heights apartments.
A New York City landlord is locked in a legal fight with veteran multifamily investor Sentinel Real Estate over an alleged scheme to inflate the value of five Washington Heights apartment buildings. The landlord, an LLC connected to Michael Aryeh’s Heritage Realty, says Sentinel and its affiliates misrepresented the rent-stabilization status of dozens of apartments, allowing the company to sell the properties at artificially high prices, according to a lawsuit filed in state Supreme Court.
Aryeh claims he overpaid by at least $50 million when he purchased the buildings for $85 million between 2016 and 2017.
The case has been ongoing since 2018, with both sides filing multiple motions and counterclaims. Aryeh's LLC alleges that Sentinel and its affiliates "knowingly and intentionally" misrepresented the rent-stabilization status of the apartments and failed to disclose that the buildings were subject to a city inquiry.
Meanwhile, Sentinel has denied any wrongdoing and claims that Aryeh's LLC was aware of the rent-stabilization issues and the city inquiry prior to purchasing the buildings.
"We are confident that the court will find that Sentinel and its affiliates acted in good faith and did not misrepresent any material facts to the plaintiff," said a spokesperson for Sentinel Real Estate.
The properties in question are located at 800 Riverside Drive, 739 West 186th Street, 736 West 186th Street, 736 West 187th Street, and 1-3 Chittenden Avenue.
The lawsuit also alleges that Sentinel's affiliate, Sentinel Asset Management, artificially inflated the rents of the apartments, which ultimately led to the inflated sale price of the buildings.
The case is ongoing and is awaiting a