Favoritism and political influence tainted the city’s pick for a development team to transform the Kingsbridge Armory in the Bronx, according to a lawsuit filed Friday by a developer whose bid was rejected due to funding problems.
Mayor Eric Adams’ administration announced in January that it had chosen Joy Construction and Maddd Equities to spearhead a roughly $600 million rebuild of the huge Bronx building, which has sat vacant for years and been the target of several failed renovation attempts. Their winning proposal, boosted by $100 million commitments from both the state and city, includes event space, youth sports fields and a workforce development education center, with 450 housing units to be built in a second phase.
But Manhattan-based Agallas Equities claims in its suit that its own proposal was nearly chosen — evidenced by a draft December 2024 press release in which the Adams administration appeared ready to name Agallas and its partners — the McKissack Group, Exact Capital Group and JV Construction & Consulting — as the winners. Agallas claims that the city’s Economic Development Corp. wanted Maddd-Joy to win and tipped the scales in their favor by allowing those developers to borrow ideas from Agallas’ proposal.
“The procurement process conducted by EDC was arbitrary and capricious, and tainted by political influence, conflicts of interests, procedural irregularities, and the misappropriation of Petitioner’s intellectual property in their proprietary proposal,” reads the suit, filed in Manhattan state court. Agallas and its leader, Manuel Tavarez, are asking a judge to annul the contract for the winning bidders’ contract and halt the redevelopment, which is known as El Centro Kingsbridge.
In a statement, EDC spokesman Nico Agular said: “After a rigorous evaluation of all proposals, NYCEDC selected El Centro Kingsbridge’s proposal, which is consistent with the values of the Kingsbridge Vision Plan and the requirements of the RFP.”
EDC declined to respond to the suit in detail, citing the pending litigation, but said the winning bid would generate $2.6 billion in economic impact over 30 years and create 360 permanent jobs.
A spokesman for the winning bidders, known collectively as 8th Regiment Partners, said in a statement that the developers are “proud of the restorative plan we have put forward for the historic Kingsbridge Armory — a plan that includes many community priorities that were laid out during the public visioning process.”
“In line with our long-standing, successful track record executing public-private projects in New York City, we look forward to continuing to work with the Bronx community over the coming months and years to deliver the jobs, housing and economic benefits of this city-supported project,” spokesman John DeSio said.
Maddd and Joy are prominent firms that have teamed up frequently on projects in the Bronx. Agallas is less known — the firm’s website appears to be non-functional — although records show the company has retained the lobbying firm Capalino to press city officials on the Armory redevelopment since 2022.
Agallas’ proposal would have included community space, 275 units of housing, a four-star hotel, an “International Salsa Museum” and sports fields, the latter of which it later replaced with a live entertainment venue, according to the suit. It responded to the city’s request for proposals in January 2024.
Agallas believed it had an initial leg up, citing an early conversation in which EDC Executive Vice President Jennifer Montalvo told another city official that Agallas’ bid was “the one,” since it matched the community priorities laid out in the RFP and a visioning document released by the city. (Agallas says its lawsuit is based on information it received from another unnamed EDC vice president, who has since left the agency but told the developer about the alleged improprieties, the suit says.)
By August 2024, Agallas said it had signed a term sheet with EDC and began negotiating a pre-development agreement. But things took a turn in the ensuing weeks: Agallas was told by its architecture firm, FXCollaborative, that EDC had asked them to join Maddd Equities’ proposal, and Maddd CEO Jorge Madruga began recruiting other organizations involved in Agallas’s bid, the suit says. In those conversations, Madruga showed a detailed knowledge of Agallas’s still-confidential proposal, which the suit alleges had been shared by EDC.
Maddd and Joy were allowed to amend their proposal after the official deadline to add elements that hewed more closely to the city’s original vision, the suit states.
The suit does not spell out the political influence that allegedly tainted the process, but notes that a Deputy Bronx Borough President, Janet Peguero, formerly represented Maddd Equities as a lobbyist in a prior stint at the firm Constantinople & Vallone in 2021 and 2022. The Bronx Borough President’s office, which is named as a defendant, dismissed the claims as sour grapes from an “unhappy” applicant.
“There have been no valid claims made involving the office of the Bronx Borough President, and it is evident that the office was named merely in an attempt to generate news and attention,” spokesman Michael Ivory said. “The redevelopment of the Kingsbridge Armory is a long-overdue investment in The Bronx, promising thousands of jobs, hundreds of affordable housing units, and numerous safe community spaces. Attempting to obstruct this development for selfish business and political reasons is nothing short of disgraceful.”
By January, the city announced Maddd and Joy as the winning project, with construction slated to begin by 2027. Agallas pressed EDC in vain to reconsider, informing EDC CEO Andrew Kimball in a February email that it had lined up two new capital partners, Procida Funding Advisors and Kingspoint Heights Development, that would help it cover pre-development costs. EDC was unmoved and said the process was closed, the suit says.
Agallas had only a 20% stake in its own proposal, with Exact Capital holding a 58% stake and the McKissack Group a 20% share, according to their term sheet with EDC. None of those firms have signed onto the lawsuit, however.
The lawsuit is the latest chapter in the long history of the armory, which opened in 1917 and was used by the U.S. military until 1994. Attempts to find a permanent use for it have failed: Michael Bloomberg’s administration hoped to convert it into a shopping mall, and later an ice-sports center.
The ice-rink plan remained alive for years as its backers sought hundreds of millions of dollars in financing, but ultimately fell apart.
