NEW YORK CITY (WABC) — Isabel Adon worked hard to buy into an affordable housing co-op in the Bronx back in the late 1970s. It was something she was proud of and something she planned to pass down to her children.

“That was the legacy for my kids,” Adon said.

But overnight, she and dozens of other families in her building on Nelson Avenue learned they lost their homeownership. They became renters instead of owners with little to no notice and without being paid a cent.

“It pains me,” Adon said. “Overnight, we went from an owner to unknown status and none of us knew what was going on or what was happening.”

Back in 2018, the city of New York did what’s called a third party transfer.

That’s where the city picks buildings it believes are “distressed,” meaning it says it has physical and financial problems and transfers the deed to a non-profit to operate.

“They just like totally disrespected us, not just me, but the community,” Adon said.

Another former co-op owner, Junior Gonzalez, bought into the building after serving in the Marine Corps.

“It caused a lot of sleepless nights,” Gonzalez said. “It’s like I’m fighting another battle, fighting another war and now the people around me are affected, not just the people around me but the people who look like me are affected.”

It’s not just their building. The city did this to more than 500 properties in multiple rounds over the past three decades.

A City Council investigation found most of the properties were in minority communities and “half of the properties selected…were not statutorily distressed.”

The process wasn’t legally challenged until attorneys Yolande Nicholson and Matthew L. Berman filed a lawsuit against the city in federal court in 2019. Since then, other law firms have helped in the litigation.

“I was shocked initially that no one even understood it,” Nicholson said.

“There’s a clause in the constitution which says that government shall not take private property for public use without just compensation,” said Berman of Valli Kane & Vagnini.

After fighting in court for seven years, the city recently agreed to a $60 million proposed settlement.

It’s not for all of the residents impacted. It’s for the hundreds of people impacted by the latest round of deed transfers like Adon and Gonzalez.

“I hope that bringing this out and this settlement is a catalyst for change,” Nicholson said.

The city said, while the program was run under former administrations, it wants to continue the program with reforms.

A spokesperson for the NYC Housing Preservation & Development sent a statement saying in part:

“The Mamdani Administration and the City Council are working together closely to update and strengthen TPT in a way that addresses the concerns outlined in these suits and that better serves New Yorkers and our goal of creating and preserving safe, stable housing for tenants.”

Attorneys representing the plaintiffs don’t believe the program should continue.

“I don’t know how you reform something that’s been shown not just in our litigation but by the U.S. Supreme Court, to be widely, systemically illegal,” Nicholson said.

“I would advocate against that because the government already has the eminent domain power, and that is the appropriate vehicle for enacting and furthering the government policies that it wants to further,” Berman said.

The settlement still has to be approved by a judge and they’re still fighting for the hundreds of other families who had their ownership rights taken.

“We’re not jumping for joy, we’re just a little bit relieved that at least this got a little bit of attention,” Gonzalez said.

Affected residents said they’ll believe there’s a settlement when they see it. And their fight, isn’t over.

“This is a systematic way of not allowing people who look like me to have intergenerational wealth,” Adon said. “It’s not allowing me to have for my children, not allowing me to have a piece of the American dream.”

A judge and the residents have to all sign off on the proposed settlement which could be resolved by next summer.

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