By Sabina Mollot
Brookfield bosses set out this week to allay concerns of the nearly 30,000 Stuyvesant Town and Peter Cooper Village tenants they aim to partner with on a multi-billion dollar bid to buy the East Side complex.
Last week, Brookfield Asset Management announced it would partner with the tenants of the sprawling East Side middle-income housing complex to put together a bid to buy the 11,000 apartments and convert them to condos.
The Toronto-based investment firm that is also downtown New York’s biggest office landlord, took part in a tenant meeting on Saturday to answer tenant questions about the buy-out plan.
Barry Blattman, senior managing partner for Brookfield, insisted his firm was getting into the deal “as a white knight rather than a vulture-type investor,” noting how tenants have been caught in a maelstrom since the 80-acres property had been handed to the lenders CW Capital.
Tishman Speyer Properties and BlackRock Inc. defaulted on their mortgage loan after the global economic collapse turned their $6.3 billion purchase of the property in 2006 into one of the biggest busts of the boom.
“We want to go where we’re wanted,” Blattman told tenants at the weekend meeting. “We like to sleep at night in terms of what we own and the risks we take… We’re wary of debt.”
At the packed Mason Hall auditorium at Baruch College, Blattman outlined Brookfield’s 30 years of experience investing in New York’s higher profile properties, including the World Financial Center.
“You may know we’re the owners of Zuccotti Park,” he said. “If this is a complicated situation, believe me, we’re used to them.”
Outlining his company’s global real estate experience with over $150 billion in assets, Blattman said, “We think it’s a very good time to be involved in [the multi-family] sector,” adding that he hoped an offer would be ready to put to the lender by April, although he said he could not guarantee another, more attractive offer would not be presented to CWCapital.
Developer Gerald Guterman last year outlined a plan to take the complex co-op. Last Friday, he sent out letters to every resident in ST/PCV explaining why his plan to convert to affordable co-ops was preferable to Brookfield’s condo option.
The developer, one of over 50 parties who have each reached out to the Tenants Association with some sort of buyout plan, expressed his disappointment that he had to find out about the new partnership through the media.
Guterman told REW that converting to condos would take far longer (due to there being over 11,200 individual tax lots) and that, in order for tenants to take advantage of certain tax benefits, they would need to go co-op to benefit.
“We’ve done this our whole lives,” said Guterman, founder of Guterman Westwood Partners. “We understand conversions of rent-controlled and rent-stabilized properties.”
Guterman, a 43-year veteran of the real estate industry, has conducted conversions of thousands of units in the city, including John Adams on Sixth Avenue, the Park Vendome on Columbus Circle and Glen Oaks Village in Queens.
“The tenants have an absolute right to make their own decision at the time that anybody offers a plan to them,” he said. “It’s simply a matter of three things: price, affordability and financing.”
Guterman has said previously and in the letter to tenants that the company was willing to provide financing of up to 85 percent to those tenants who want to buy their homes.
City councilman Dan Garodnick, who has helped broker the Brookfield partnership, dismissed Guterman’s claims that his plan would work out cheaper for tenants, saying, “That is the kind of come-on you would hear on late night TV.”
“It is greatly misleading, and if something sounds too good to be true, it probably is,” said Garodnick, adding that the Tenants Association’’s decision to partner with Brookfield has been made after months of meetings with potential partners, many of who didn’t share tenants’ goals of stability and long-term affordability.