Big Legal Setback for Tishman and BlackRock
Tishman-Speyer and BlackRock Realty, the partnership owners of Stuyvesant Town and Peter Cooper Village, the huge 110-building apartment community on the east side of Manhattan, were pushed one step closer on Thursday to defaulting on the complex’s debt after New York State’s highest court upheld a lower court ruling that the companies had wrongfully raised rents and deregulated thousands of apartments after receiving special tax breaks.
The decision is a major blow to Tishman and BlackRock, which bought the two sprawling apartment complexes in 2006 from MetLife at the height of the credit boom for $5.4 billion. The new owners thought they could raise rents high enough to cover their huge debt payments.
Instead, the New York State Court of Appeals ruled: “The current and former owners of the properties, respectively, were not entitled to take advantage of the luxury decontrol provisions of the Rent Stabilization Law (RSL)1 while simultaneously receiving tax incentive benefits under the City of New York’s J-51 program. We agree.”
via Big Legal Setback for Tishman and BlackRock – DealBook Blog – NYTimes.com.