The developer behind a major affordable housing project in New York's Bronx borough has sought bankruptcy protection, throwing state-backed plans for thousands of units into uncertainty. Dynamic Star LLC, the owner of the Fordham Landing development, filed for Chapter 11 bankruptcy on December 1 in a New York court.
Bankruptcy Halts Foreclosure, Puts State Funds on Hold
The filing comes just weeks after New York state officials agreed to commit a substantial $55 million to support infrastructure construction for the project's southern phase, known as Fordham Landing South. This phase alone promises roughly 900 affordable housing units. A person familiar with the matter confirmed that the state has not yet disbursed this funding and will complete its due diligence before releasing any money.
The bankruptcy filing was strategically timed to halt a foreclosure sale initiated by project lenders, including an affiliate of commercial real estate firm CREMAC Asset Management LLC. According to Dynamic Star's bankruptcy lawyer, Kevin Nash, the Chapter 11 action has successfully paused the foreclosure and preserves the project's value. "We're planning to proceed with the development and still think it's going to be successful," Nash stated on Thursday.
A Massive Two-Phase Development Along the Harlem River
The ambitious Fordham Landing project is split into two distinct parts. Fordham Landing South is further along in development. The larger-scale Fordham Landing North will take longer to complete. Combined, the development along the Harlem River aims to build thousands of affordable homes.
In a court filing, Dynamic Star co-founder Brad Zackson expressed confidence in the project's future, stating that the plan to develop thousands of affordable units aligns with the political climate in New York. He revealed the company has spent the past two years seeking zoning approvals for 4,000 affordable housing units planned for the North phase. Zackson believes that once this re-zoning is approved, the project will attract new investors and construction partners.
Legal Challenges and Official Response
Beyond the foreclosure threat, the developer faces other legal hurdles. In August, AECOM Tishman, the contractor and construction manager for the Fordham South project, filed a complaint seeking to recover money it claims it is owed for work performed.
The New York City Department of Housing Preservation and Development acknowledged the situation. A spokesperson said, "We are aware of the bankruptcy filing, and we look forward to receiving an update from the development team later this week. We expect to be building housing at this site and delivering much-needed affordable homes for New Yorkers."
The project's fate is being closely watched, as making housing more affordable was a central pledge of Mayor-elect Zohran Mamdani's campaign. The case, Dynamic Star LLC (No. 25-23154), is proceeding in the U.S. Bankruptcy Court for the Southern District of New York.
