A joint venture between New York developer Tishman Speyer and BlackRock Realty, which was recently acquired by Merrill Lynch, has acquired Manhattan’s Stuyvesant Town and Peter Cooper Village from MetLife for $5.4 billion (€4.2 billion), one of the largest real estate transactions of its type.
The partnership’s bid topped a field of more than a dozen competitors, including prominent private equity real estate firms and real investors, such as Apollo Real Estate Advisors and partner Dermot Company, Related Companies and Lehman Brothers and Vornado Realty Trust, as well as a bid from a tenant’s group.
Tishman Speyer and BlackRock will gain control of New York’s largest apartment complex, a virtual city within the city. Between the two communities, there are 110 buildings with 11,200 apartments that cover nine city blocks on the East Side of lower Manhattan—rising between First Avenue and the East River from 14th Street to 23rd Street.
Metlife will gain $3 billion on the properties, which it held for close to 60 years, according to a statement. The life insurer built Stuyvesant Town and Peter Cooper Village in the 1940s to house veterans returning from World War II. The communities have served as bastions of New York’s middle class even among the fast-rising rents of recent years. Approximately 75 percent of the apartments reportedly fall under some kind of rent control or rent stabilization rule, prompting concern among tenants groups.
Tishman Speyer president and chief executive Jerry Speyer said the firm appreciated the place of Stuyvesant Town and Peter Cooper in New York history and would be “stewards of the property.”
“The thousands of tenants in rent-stabilized apartments are completely protected by the existing system,” he said in a prepared statement. “No one should be concerned about a sudden or dramatic shift in the neighborhood’s make-up character or charm.”
By adding Stuyvesant Town and Peter Cooper, Tishman Speyer has added to its portfolio of trophy real estate properties in New York. It also owns landmarks including the Chrysler Building and Rockefeller Center.