Middle-class units saved in $5.3 billion sale of Stuyvesant Town-Peter Cooper Village

Tuesday, October 20, 2015
Middle-class units saved in $5.3 billion sale of Stuyvesant Town-Peter Cooper Village
Dave Evans has the latest details.

NEW YORK -- Manhattan's largest apartment complex will be sold for $5.3 billion in a deal that will preserve nearly half its 11,232 units for middle-class families, New York City officials said Tuesday.

"The teachers, the firefighters, the police officers, the nurse, the everyday people who make this city great can live here in the middle of Manhattan," said Mayor Bill de Blasio, who called the deal for Stuyvesant Town-Peter Cooper Village "the mother of all preservation deals."

Stuyvesant Town and Peter Cooper Village have housed middle-income New Yorkers since the 80-acre complex on Manhattan's east side was built in 1947 for returning World War II veterans.

The complex will be sold to Blackstone and Ivanhoe Cambridge, a subsidiary of Canadian pension fund manager CDPQ.

Officials said that about 4,500 apartments will be reserved for middle-income families for at least 20 years. Another 500 will be kept for lower-income families.

"The deal brings affordability and stability back to our community," said Susan Steinberg, head of the complex's tenant association. "Considering today's real estate forces, this is a solid outcome."

Original owner MetLife sold the complex for $5.4 billion in 2006 but the new owners, Tishman Speyer Properties LP and BlackRock Inc., defaulted on the loan.

CW Capital Asset Management LLC has controlled the property since 2010.

Just over half of the units have already been converted to market-rate. Under terms of the new deal, 90 percent of any vacancies in the remaining apartments will be set aside for families making around $130,000 a year, the average income for a family in the complex now. The other 10 percent will be for families making as little as $60,000.

The parties can revisit the deal between now and 2036 in order to create more affordable housing protections.

"Our agreement with the city preserves the heritage of this place," said Jonathan Gray, head of real estate at Blackstone. "The uncertainty and turmoil this complex has endured since the financial crisis is definitively over."

He added that we "want to own this for a very long time" and jokingly asked for no tenant complaints "until we actually close at the end of the year."