Trailer parks are banned from Stuy Town … and 3 other things we learned from the $5.3B deal’s term sheet

Senior activities, loans that aren't really loans ... & more

TRD New York /
Nov.November 06, 2015 02:05 PM
 

Last month, the city and the Blackstone Group signed an agreement to keep 5,000 units at Stuyvesant Town-Peter Cooper Village affordable. The term sheet for the agreement is publicly available. But it’s 12 pages long and a pretty dry read. For your convenience, we’ve summarized the main points in a listicle:

1. No trailer parks

 
 

“None of the Affordable Units will be used by Purchaser on a transient basis or as a hotel, motel, hospital, nursing home, sanitarium, rest home or trailer park.” I guess if you’re spending $5.3 billion, you want to be absolutely sure there are no misunderstandings.

2. Under the deal, there may be no affordable apartments left in Stuy Town 25 years from now.

 

This is no secret, but it deserves to be hammered home. Under the agreement, Blackstone can likely reduce the number of affordable units from 5,000 to almost zero between 2035 and 2040.

Here’s why: Blackstone committed to keeping 5,000 units rent-controlled. If, say, vacancy decontrol brings the number of affordable units down to 4,500 next year, Blackstone will have to make sure 500 extra units become affordable for new tenants. But Blackstone only has to keep these new “future affordable units” rent-controlled until 2035 – not for as long as the tenants stay there. Between 2035 and 2040, it can raise the rent for all “future affordable units” to market level in annual installments.

According to Deputy Mayor Alicia Glen, Stuy Town has been losing about 300 affordable apartments per year to vacancy decontrol. If this trend continues, almost all current affordable units in Stuy Town will be either market-rate or “future affordable units” by 2035. By 2040, these will likely all be market-rate units.

3. Funtivities!

 

Under the term sheet, Blackstone has to offer a “targeted schedule of senior activities and interest groups to engage the senior community. Some examples would include book clubs, movie nights, dance/exercise classes, etc.”

I have a few questions: Will those dance classes be taught by Blackstone executives? Is Jonathan Gray good at dancing? And what would the reading list for a Blackstone book club look like? (Email me at [email protected] if you have any suggestions)

4. About that $144 million city “loan” …

 

Is a loan still a loan if it carries no interest and you never have to pay it back?


Related Articles

arrow_forward_ios
Blackstone CEO Steven Schwartzman and Stuyvesant Town (Credit: Getty Images)

After authorities vowed review of Stuy Town deal, Blackstone changes course on vacancies

After authorities vowed review of Stuy Town deal, Blackstone changes course on vacancies
Blackstone COO Jonathan Gray and Club Quarters Chicago at 111 W Adams Street (Getty, Google)

Blackstone misses payment on $274M hotel loan

Blackstone misses payment on $274M hotel loan
Blackstone’s Jonathan Gray

TRD Insights: Here’s how much tenants pay for space at Blackstone’s massive industrial portfolio

TRD Insights: Here’s how much tenants pay for space at Blackstone’s massive industrial portfolio
Blackstone’s Jonathan Gray, Starwood Capital Group’s Barry Sternlicht, and Oaktree Capital co-chairman Howard Marks (Getty)

“Phenomenal returns” for some distressed real estate investors in stocks

“Phenomenal returns” for some distressed real estate investors in stocks
Hudson Commons and 444 N. Michigan Ave. 

TRD Insights: Can CLOs recover from the pandemic?

TRD Insights: Can CLOs recover from the pandemic?
Blackstone's president Jonathan Gray and CEO Stephen Schwarzman (Credit: Gray via Drew Angerer/Getty Images; Schwarzman via Himanshu Bhatt/NurPhoto via Getty Images)

Blackstone: “We don’t need financing to get things done”

Blackstone: “We don’t need financing to get things done”
Blackstone’s Jonathan Gray and Starwood Capital Group’s Barry Sternlicht (Credit: Gray by  Drew Angerer/Getty Images; Sternlicht by Cindy Ord/Getty Images for 1 Hotels)

Blackstone, Starwood pick up stakes in Extended Stay America

Blackstone, Starwood pick up stakes in Extended Stay America
Clockwise from bottom left: 62-60 99th Street in Rego Park, 850-870 Third Avenue in Sunset Park and Square Mile Capital’s Craig Solomon with renderings of 550 Clinton Avenue in Brooklyn (Credit: Google Maps; Getty Images; Morris Adjmi Architects)

These were the top outer borough loans last month

These were the top outer borough loans last month
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...