NEW YORK CITY — The Blackstone Group (NYSE: BX), in partnership with Ivanhoé Cambridge, has acquired Stuyvesant Town-Peter Cooper Village, a 110-building multifamily complex in Manhattan that includes more than 11,000 units. Although the purchase price wasn’t disclosed in a press release issued today by the mayor’s office confirming the deal, the Wall Street Journal lists the sales price at approximately $5.3 billion.
Ivanhoé Cambridge is the real estate arm of Canadian pension fund Caisse de dépôt et placement du Québec.Since 2010, a group of creditors led by CWCapital Asset Management, owned by Fortress Investment Group LLC, has controlled the complex, the Journal adds.
As part of the deal, Blackstone signed a regulatory agreement with the City of New York to preserve 5,000 units of the complex as affordable housing for the next 20 years. Some 4,500 of the two-bedroom units will be reserved for families of three earning up to $128,210 per year. They will pay rent of $3,205 per month. An additional 500 two-bedroom units will be reserved for families of three earning up to $62,150 per year, who would pay approximately $1,553 per month.
The remaining half of the units of the complex would rent at market rate, or more than $4,200 per month for a two-bedroom apartment.
“It is a tremendous honor and responsibility to become co-owners of Stuyvesant Town and Peter Cooper Village,” said Jon Gray, global head of real estate for Blackstone in a press release. “We and Ivanhoé Cambridge are pleased to have reached this agreement with the City of New York, Mayor Bill de Blasio, Councilman Dan Garodnick and the Stuyvesant Town and Peter Cooper Village Tenants Association to preserve its heritage of affordable rental housing. We intend to own Stuyvesant Town and Peter Cooper Village on behalf of our investors for many years to come.”
“We have been an important real estate investor in New York City for over 20 years,” added Daniel Fournier, chairman and CEO of Ivanhoé Cambridge. “Today, we have more capital at work in New York than in any other city in the world. We are delighted to invest in this exceptional property in partnership with Blackstone and, together with them, we look forward to building sustainable long-term relations with the community and our tenants.”
For its part, the City of New York has agreed to waive $77 million in mortgage recording taxes, as well as to provide Blackstone with a $144 million low-interest loan through its Housing Development Corp.
Blackstone has also agreed not to convert units to condos or build additional towers on the property.
Tishman Speyer Properties purchased the complex, which was built in 1947 by MetLife for returning war veterans, in 2006 for $5.4 billion.
In 2010, REBusinessOnline.com reported that Tishman Speyer and its partner BlackRock had handed over control of the complex to CWCapital. At the time, the partnership renovated many units in an attempt to raise rents quicker than New York rent controls allow, but was unable to increase its revenue fast enough to cover loans.
CWCapital hired Douglas Harmon of Eastdil Secured last year to market the sale of the property.
New York-based Blackstone is a multinational private equity, investment banking, alternative asset management and financial services corporation founded in 1985.
Blackstone’s stock price closed on Monday, Oct. 19, at $33.93 per share, up from $29.41 per share a year ago.
— Scott Reid