The city comptroller is scrutinizing the Bloomberg administration’s relationship with a Manhattan real-estate mogul who purchased four Brooklyn buildings with the intention of converting them into homeless shelters.
Luxury hotel developer Shimmie Horn has been working with the Department of Homeless Services to turn buildings in Greenpoint, East New York and Brownsville into 200-bed shelters since March, potentially earning millions of dollars in the process.
A spokesman for Comptroller John Liu said only that the city’s auditor would work with elected officials to “hold the Department of Homeless Services accountable to a fair, transparent and equitable siting process.” But a source added that Liu has agreed to review at least one of the contracts for “irregularities.”
That said, a spokesman for Horn, who owns several facilities for the homeless throughout the city and a handful of boutique hotels, flatly denied the city has a contract the hotelier and that he instead contracts with nonprofit groups who run the shelters.
“There is no contractual relationship between Mr. Horn and the Department of Homeless Services, any suggestion of an inappropriate relationship is patently absurd,” said Horn spokesman Stefan Friedman.
That “suggestion” comes from local elected officials, among other sources.
Councilman Steve Levin, for example, chastised the city for “pre-approving” Horn’s purchases without a public review and called on city comptroller John Liu to review all contracts between the city and shelter operators in Horn’s buildings.
“The city has a responsibility to site public facilities through a transparent and equitable process, yet the Department of Homeless Services seems intent on contracting with one private developer in order to avoid public scrutiny,” said Levin (D–Greenpoint).
The Department of Homeless Services has wanted to put a 200-bed shelter in northern Greenpoint since last August, when it approached the Manhattan-based social services provider HELP USA about operating a shelter on the site.
Greenpointers began protesting the city’s push to turn an artist-filled McGuinness Boulevard warehouse last year and negotiations unravelled in February.
But one month later, its owner sold the building for $5 million to Horn, who said he would work with a new provider, the Bowery Residents’ Committee to open a shelter on the site.
Since the city does not own the site, its plan to open a shelter on McGuinness Boulevard does not have to go through a lengthy land use review process.
“They don’t want to own any properties,” said a Council source. “So they have nonprofit providers buy the building or they pair up the provider with the developer. In this case, they found a developer.”
It’s unclear why the city would even want to deal with Horn, who was a board member of a corrections company that was forced to cough up $300,000 in fines after being implicated in a bribery scandal that resulted in the resignation of two state assemblymembers in 2002.
The city has not yet reached an agreement with the Bowery Residents’ Committee, but work at the site has already begun.