Settlement Approved, Stuy Town Seeks Income Boost
CWCapital Management, the company that controls the Stuyvesant Town and Peter Cooper Village, is reportedly planning to boost operating income at the complex before putting it up for sale. CWCapital has been in control of the complex on Manhattan’s East Side since early 2010, when prior owner Tishman Speyer Properties LP and its partners surrendered the property to creditors. The complex’s primary creditors are investors in bonds backed by the building’s mortgage, and Maryland-based CWCapital represents them.
CWCapital recently completed a settlement in a class action that concerned rents on luxury units, agreeing to pay $68.75 million in rent overcharges to tenants. Around 21,250 current and former market-rate tenants who were paying unjustly inflated rents as a result of misinterpreted rent stabilization laws will get checks for an average of $3,200 apiece. But because the case also resulted in rent reductions, the total take by residents comes to about $173.25 million. The company previously had cited the lawsuit as a roadblock to any potential sale, given the uncertainty it would create for buyers.
The company gradually has increased income by converting units with below-market rents into luxury units after they go vacant. Some luxury two-bedroom units go for more than $3,800 a month. Rent at unrenovated apartments can be half that or less. And as of 2009, the last data available, 60 percent of the apartments were below market rate.