How a city program stripped minority families of generational wealth

Wealth & Business · Published 20 October 2026 Swipe more like this →

In short: New York City's Third-Party Transfer (TPT) program was framed as a way to rescue derelict buildings. However, a forensic investigation revealed a harsher reality: the process systematically targeted black and brown-owned properties, stripping owners of their equity without compensation and dismantling community wealth.

To enable the Department of Housing and Preservation (HPD) to hand over buildings with tax debts or in disrepair to non-profit groups, the Giuliani government established the Third-Party Transfer (TPT) scheme in 1996. The stated goal was to rehabilitate these properties for working-class residents, theoretically freeing the city from the responsibility of maintaining blighted structures.

A 2019 joint committee forensic investigation, involving Ritchie Torres and Robert Cornegy, exposed a mechanism of systemic malfeasance. The investigation found that HPD and the Department of Finance (DOF) followed a rule to select every other building in a tax block with a lien—even if the lien was only a few hundred dollars. This broad net resulted in the targeting of numerous black and brown-owned properties.

The distinction between TPT and standard foreclosure is significant. While a foreclosure typically allows a property owner to receive a share of the proceeds from a sale, the TPT process allows the city to completely strip the owner of all equity. By taking over these properties, the city effectively mitigated the sweat equity and resources invested by minority owners, resulting in the loss of millions of dollars in generational wealth.

This investigation highlights a critical tension between the administration's characterization of the TPT as a tool for urban renewal and the actual impact on community stability. For many residents, it represented a mechanism of displacement that bypassed the protections usually afforded to property owners, creating a permanent loss of assets for underserved communities.

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