CRE firms battle for future of Stuy Town
The historic Stuyvesant Town-Peter Cooper Village apartment development in Manhattan remains the subject of much debate as sparring firms try to pull the property out of default and allocate more homeownership power to residents.
As HousingWire reported, Stuyvesant Town-Peter Cooper Village Tenants Association and Brookfield Asset Management reached a deal in which the asset management firm agreed it would acquire the development and turn the community into a property that operates on the principles of tenant ownership. In other words, residents would actually buy their apartments -- a development that rent-controlled residents started supporting in recent months.
CW Capital is the special servicer for the property and represents the interests of senior commercial mortgage-backed securities bondholders.
Stuy Town Tenants and Brookfield Asset Management started lobbying CW Capital in late November to approve the deal. If finalized, the deal would let Brookfield finance the acquisition and convert the living quarters.
Still, there's a company with a competing interest. This week, real estate and property management firm Guterman Westwood Partners sent a letter to Stuy Town residents, saying the Brookfield Asset Management deal is not the premium choice for tenants. Instead, GWP is reminding tenants of their long-standing plan to turn the development into a co-op.
In a letter to tenants, the firm said "per our proposal, the cooperative corporation would become the actual borrower of approximately 45% of the total sales' price to buy your apartments. As a result, the carrying costs for that portion of the purchase price, would be lower by approximately 2% per year than if each of you had to qualify for much larger condominium mortgages."
The tenants association for the development's residents previously indicated that the residents living in the rent-controlled apartments wanted to buy their units.
Stuy Town, which was built for World War II veterans, was sold by MetLife ($43.28 0.71%) to Tishman Speyer Properties and BlackRock Realty for $5.4 billion in 2006.
MetLife received a 25-year tax abatement for providing affordable housing to Manhattan residences. When state courts said the tax abatement disqualified Tishman from raising rents, the firm defaulted on its loans.
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