Real estate investment firm Summit Properties USA has successfully secured court approval for its $451 million acquisition of apartments from Pinnacle Group LLC, a company that filed for bankruptcy in May. The transaction received the green light from U.S. Bankruptcy Judge David Jones on Friday, effectively overcoming legal objections raised by New York City Mayor Zohran Mamdani.

Pinnacle Group LLC initiated Chapter 11 bankruptcy proceedings, listing over $564 million in debt. Advisers for Pinnacle attributed the bankruptcy filing to several factors, including the impact of higher interest rates, increased operating costs stemming from inflation, and a notable decline in rent collections. The court had previously approved sale deadlines, which were supported by lender Flagstar Bank NA, long before the mayor’s administration intervened.

Mayor Mamdani, who assumed office on January 1, actively challenged the deal. His administration argued for a pause in the sale to allow for further review and engagement with the tenants residing in the properties. However, Judge Jones rejected these efforts by city and state officials to delay the hearing and the transaction.

The approved sale package includes $113 million in equity contributed by Summit Properties and $338.5 million in financing provided by Flagstar Bank NA. The acquisition encompasses approximately 5,200 apartments, which are predominantly rent-stabilized and located across various New York City boroughs, including the Bronx, Manhattan, Queens, and Brooklyn.

Addressing a key concern, Summit Chief Executive Officer Zohar Levy testified that his firm has committed $30 million specifically for repairs and maintenance at these acquired properties. Pinnacle's lawyer, Ken Fisher, commented on the outcome, stating in an emailed statement that the sale was the result of an