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Following Backlash, Stuy Town Owner Now Commits To Renting All Of Its Vacant Affordable Apartments
By
Elizabeth Kim
Published Sep 6, 2019
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Mary Altaffer/AP/Shutterstock
By
Elizabeth Kim
Published Sep 6, 2019
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The owner of Stuyvesant Town-Peter Cooper Village is now saying that it is not purposely keeping rent-regulated apartments empty, following criticism from elected officials, including Mayor Bill de Blasio, over a strategy that seemed to suggest they did not want to lease certain vacant units amid new laws that have reined in rent increases.
Jennifer Friedman, a spokesperson for the private equity landlord Blackstone, told Gothamist on Friday, “We are renovating and leasing all vacant units, and we will continue to fulfill our commitment to voluntarily preserve 5,000 affordable apartments.”
The statement represents a shift for the company, which as recently as Tuesday, made no such pledge, even after multiple reports and questions about its approach with recently vacated units. It also comes shortly after Mayor de Blasio said city officials were planning to have “some serious conversations” with Blackstone over an agreement it signed four years ago with the city to keep roughly half of the apartments at the sprawling complex affordable.
Although landlords are not mandated to keep rent-regulated apartments continually rented, back in 2015, the city struck a landmark agreement with Blackstone that gave the company $220 million in subsidies in exchange for keeping 5,000 of the roughly 11,200 units affordable for a 20-year period. At the time, de Blasio hailed the deal as preserving a middle-class haven for New Yorkers.
During his weekly appearance on WNYC's "The Brian Lehrer Show" on Friday, de Blasio acknowledged that the rollback of landlord-friendly rent laws passed in June was having unintended consequences.
“But at the same time, a deal is a deal,” he said, adding, “That obviously requires the apartments to be available to people.”
In the wake of the news about Blackstone, the city’s housing preservation and development agency has said that it is “conducting a thorough review in partnership with the State” of the 2015 regulatory agreement. HPD did not respond to a request for comment on Friday. The state Homes and Community Renewal agency oversees regulated apartments, but it is not a party to the city's regulatory agreement with Blackstone.
Earlier this week, a source close to Blackstone had said the company was assessing the costs of renovating units vacated by long-term tenants, which have typically not received any upgrades. Among the changes in the rent laws is the amount that landlords can claim in renovation expenses, a fraction of which can get passed along to tenants in the form of rent increases. In the past landlords of small buildings could claim as much as $40,000. The new rules placed a cap of $15,000 over a 15 year period.
The news that Blackstone was “warehousing” or intentionally keeping units vacant suggested a pattern of scaled back investment in the sprawling Manhattan complex. Back in July, Crain's New York reported that Blackstone was suspending its plans for apartment renovations. In response, the company released a statement that did not deny they were engaging in the practice: “In light of the recent legislation, we are in the process of evaluating capital investments at Stuy Town.”
State Senator Brad Hoylman, who represents the Stuy Town’s district, told Gothamist that on Friday Blackstone officials told him that they would not hold back any regulated units from being leased.
“I’m glad that Blackstone has reconsidered their approach toward rehabilitating and renting units of much needed affordable housing,” he said. “It would be unconscionable for any landlord to hoard apartments in hoping that a new state law might be overturned by the courts.”
Elizabeth Brown, a policy analyst at the Independent Budget Office who worked on a report analyzing the city’s 2015 Stuy Town agreement, said the reports of warehousing raised questions as to how the city would know if the landlord was in fact fulfilling its promise to keep 5,000 units affordable. Blackstone is required to produce a report twice a year for the city that says how many units are currently being leased. The next report is due next week.
But among the criticisms IBO made in 2015 was that the reporting requirements and due diligence procedures were insufficient.
“We noted that oversight would be difficult given the complicated structure of the deal,” Brown said.
Blackstone did not respond when asked how many units at the complex are currently vacant and what the rents on those units were.
Tagged
landlords
rent laws
HPD
stuy town
blackstone group
affordable housing
bill de blasio
Stuyvesant Town Peter Cooper Village
Elizabeth Kim
Elizabeth Kim is a reporter on the People and Power desk who covers mayoral power. She previously covered the pandemic, housing, redevelopment and public spaces. A native of Queens, she speaks fluent Mandarin. Got a tip? Email [email protected]
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