B
lueSky Management NY LLC, a Great Neck‑based real‑estate firm owned by Steven Kashanian, is ordered to pay a civil penalty of $672,578 after the New York Attorney General’s office uncovered more than 3,000 violations across its portfolio. The company operates 72 buildings in Brooklyn, Queens, Manhattan and the Bronx and has repeatedly breached city construction codes, exposing tenants to unsafe and unsanitary conditions.

    Under the settlement, BlueSky must reimburse tenants $100 for every day that heat or hot water was unavailable during the 2022‑23, 2023‑24 and 2024‑25 heating seasons. The firm is also required to eliminate all open construction violations, hire independent monitors to oversee ongoing projects, and correct any remaining infractions. The monitors will conduct unannounced inspections for a period of three years.

    The investigation, led by Attorney General Letitia James and the Tenant Harassment Prevention Task Force, traced the company’s misconduct back to a spree of acquisitions between 2018 and 2022. BlueSky purchased a large number of distressed properties and began construction without the necessary permits, leaving residents without basic utilities such as water, heat and gas. Complaints from 1,150 units—including rent‑stabilized apartments—highlighted a range of hazards: lead‑based paint, exposed wiring, leaking roofs, pest infestations, and missing or defective smoke and carbon‑monoxide detectors.

    The Task Force’s on‑site inspections and tenant interviews revealed that BlueSky had 798 open violations as of May 20, and that seven buildings still had 20 lead‑paint violations that had remained unresolved for extended periods. The firm also failed to register rent‑stabilized units, denied tenants their rights, overcharged rents, and attempted to deregulate apartments illegally. The commissioner stated the agency has zero tolerance for exploiting vulnerable tenants.

    In addition to the financial penalty, the settlement obliges BlueSky to provide affordable housing options in any building where tenants experienced harassment. The company will also be subject to ongoing oversight by an independent construction monitor, who will review all construction activity and conduct surprise inspections for three years.

    The Attorney General emphasized that families must feel safe in their homes, and that the penalties and corrective measures aim to restore safety and dignity to New York residents. BlueSky and its owner were not immediately available for comment.

    Maureen Mullarkey, a breaking‑news reporter for Newsday, previously covered Long Island stories for Patch, including the Diocese of Rockville Centre bankruptcy and the Babylon School District abuse scandals.