Quebec’s pension fund manager is building its presence in New York City by partnering in a US$5.3 billion deal to buy Manhattan’s largest apartment complex.
Ivanhoe Cambridge, the real estate arm of the Caisse de dépôt et placement du Québec, and private equity firm Blackstone will buy the Stuyvesant Town and Peter Cooper Village complex from CW Capital.
The 32-hectare development on Manhattan’s east side has housed middle-income New Yorkers since it was built in 1947 for returning Second World War veterans.
About half of the complex’s apartments have seen rents increase to market rates of up to US$10,000 per month.
But under the terms of the deal, about 4,500 apartments are to be reserved for middle-income families for at least 20 years. Another 500 would be kept for lower-income families. None of the new tenants will pay more than 30 per cent of their income in rent.
The parties can revisit the deal between now and 2036 in order to create more affordable housing protections.
In addition, tenants in about 1,400 apartments whose regulated rents were set to expire in 2020 will see rent increases limited to five per cent annually for five years.
Ivanhoe Cambridge chairman and CEO Daniel Fournier said the company has been an important investor in New York City for more than 20 years.
“We are delighted to invest in this exceptional property in partnership with Blackstone and, together with them, we look forward to building sustainable long-term relations with the community and our tenants,” he said in a news release.
Original owner MetLife sold the complex for US$5.4 billion in 2006 but the new owners, Tishman Speyer Properties LP and BlackRock Inc., defaulted on their loan.
CW Capital Asset Management LLC has controlled the property since 2010.
With files from The Associated Press