The Blackstone Group is seeking $2.3bn in financing for its acquisition of Stuyvesant Town-Peter Cooper Village, sources tell Real Estate Capital.
Blackstone and partner Ivanhoe Cambridge agreed this week to pay $5.3bn for Manhattan’s largest apartment complex after striking a deal with the city of New York regarding affordability guidelines for its 11,232 units.
Blackstone and Ivanhoe are said to be contributing $1.3bn of equity each.
“This is a very different situation from back then,” Jonathan Gray, global head of real estate for Blackstone, assured a crowd at a press conference this week, local blog Town & Village reported.
He called the leverage being sought “very low,” noting that the firm was seeking lower returns and less risk on the “long-term” hold.
The sale includes an agreement with Mayor Bill de Blasio’s administration reserving a block of 5,000 apartments as “affordable” under city guidelines for the next 20 years. Blackstone also cannot pursue a condominium conversion or build new towers on the property.
In return, the city is providing Blackstone with a $144m “low-interest loan” through the Housing Development Corporation and waiving $77m in mortgage recording taxes.
Tishman Speyer’s bullish projections for rent increases fell way short, prompting a default on $4.4bn of debt in January 2010, when CW Capital took control on behalf of lenders.
Blackstone declined to comment.