The owners of Starrett City, a Brooklyn housing complex in which President Donald Trump has an ownership stake, announced Wednesday that they had found a buyer for the complex, which receives federal subsidies for affordable housing units.
The news that Trump could profit from the sale of the country’s largest federally subsidized housing complex prompted Democrats on the House Oversight Committee to demand information from the Department of Housing and Urban Development (HUD) on the potential sale.
Democrats on the committee previously sent a letter in July to HUD, raising concerns about the fact that Trump could profit if the agency approved the sale of Starrett City. The members asked the department for communications and documents related to Trump’s stake in the complex. In a statement issued Wednesday night, Rep. Elijah Cummings (D-MD) and Rep. Hakeem Jeffries (D-NY) said that while they’ve received some documents from HUD, they haven’t gotten any information about the potential sale.
“We warned months ago that President Trump and his family could receive a multi-million dollar windfall if officials in his Administration—who ultimately report to him—approve the sale of Starrett City, so we are deeply concerned by this new report that a secret deal may be in the works,” they said in the statement. “Both the Obama and George W. Bush Administrations opposed previous efforts to sell the property because the parties refused to guarantee that families who rent there would be protected, so we need to understand what actions the Trump Administration has taken—or is about to take.”
“We will again push for clarification concerning how President Trump would profit from this potential sale and how affordable housing for thousands of working class families will be protected,” they added.
Trump has a four percent ownership stake in Starrett City. The sale of the complex to a venture between real estate firm Brooksville Company and private equity firm Rockpoint Group must be approved by HUD, as well as by state regulators.
Some New York lawmakers already pledged to carefully examine the potential sale.
“We shouldn’t do this without a full vetting by the tenants,” state Assemblyman Charles Barron (D) told the New York Times. “There’s going to be a battle on this one.”
The owners of Starrett City previously tried to sell the complex in 2007, but federal and state regulators blocked its sale to a partnership that wanted to convert the complex into market rate housing, per the New York Times. A refinancing deal for Starrett City reached in 2009 requires that the complex maintain affordable housing units until 2039, per Bloomberg News.
Trump’s ownership stake presents a conflict of interest for the President, given that HUD would oversee any potential sale of Starrett City and helps set the amounts the federal government pays to subsidize affordable housing units. Trump appointed Lynne Patton, a former aide to the Trump family, to the position at HUD that oversees housing policy in New York and New Jersey.
Cummings and Jeffries also pointed out in their July letter to HUD that Trump’s budget proposal did not touch the program from which Starrett City benefits, while suggesting cuts to other affordable housing programs.
Kathleen Clark, an ethics expert at Washington University in St. Louis, told TPM that Starrett City is a “beautiful illustration” of why Trump should have divested from his financial interests upon taking office if he wanted to avoid such conflicts.
“HUD’s treatment of this potential sale may well reflect a desire to please the President, rather than a desire to do what’s the correct housing policy for the country,” Clark said.