CW Capital is mired in paperwork in $173M in Stuy Town case

Special servicer gives no reason for delay or when tenants will see rent money
August 30, 2013 03:45PM

CW Capital is stuck in administrative hell as it works to return $173 million to tenants of Stuyvesant Town-Peter Cooper Village who paid too much in rent.

The firm does not have a date for compensating 27,000 tenants who paid market rates for apartments that were rent-stabilized. Earlier today, Crain’s reported CW Capital will miss an October deadline.

“A timeframe was never established,” said Brian Moriarty, a spokesperson for the building owner. “We hope that tenants are paid as soon as possible, but it is a lengthy administrative process given the number of claimants.”

The 11,000-unit complex and CW Capital negotiated a settlement to a 2007 class-action lawsuit, which a New York state judge signed off on in April. In June, some 2,000 tenants learned they would be spared mid-lease rent hikes as part of a deal between CW Capital and New York Attorney General Eric Schneiderman, as previously reported.

Former Stuy Town owner Tishman Speyer improperly raised the rents, but CW Capital is repaying the funds because it now controls the complex; Tishman Speyer charged the higher rates at the same time that it was enrolled in a tax abatement program intended to prevent significant rent hikes, Crain’s reported.

“This money belongs to tenants who overpaid and they should get it back without further delay,” said Dan Garodnick, a City Council member and Stuy Town resident, told the publication. [Crain’s]Mark Maurer

Correction: A previous version of this article incorrectly stated that CW Capital missed a court-ordered deadline for compensating Stuy Town tenants.