$3B Debt Forces Tishman and Blackrock to Return Peter Cooper/Stuyvesant Town Property to Creditors

Peter Cooper and Stuyvesant Village residents are wondering what is next after Tishman Speyer and BlackRock returned their keys to creditors.

February 1, 2010
By Barbra Murray, Contributing Editor

A little over three years after having acquired the 1,000-unit Peter Cooper Village/Stuyvesant Town (PCV/ST) multifamily complex in Manhattan from MetLife Inc. for a record-breaking residential price tag of $5.4 billion, joint venture partners Tishman Speyer L.P. and Blackrock Realty have agreed to relinquish control of the property to lender CWCapital Asset Management. With a $3 billion first mortgage on the apartment property hanging over their heads, Tishman and Blackrock will get some relief from the pressure through the deed-in-lieu of foreclosure transaction.

Consisting of 56 structures occupying 80 acres along First Avenue between 14th and 23rd streets downtown, PCV/ST was developed more than 60 years ago. The $3 billion debt on PCV/ST entails five Commercial Mortgage Backed Securities Trusts. Tishman and Blackrock missed a payment on the aforementioned loan–which was transferred to special servicing in early November 2009–on January 8, leaving the partners in default status.

Transfer of control and operations of PCV/ST to CWCapital notwithstanding, Tishman and Blackrock still financial commitments on the property. There is an additional $1.5 billion of mezzanine debt outstanding.

Tishman and Blackrock’s handing over of the apartment community to creditors has left residents wondering how the change will impact them. “This property is not a football for various real estate moguls to fight over as a prize for their portfolios,” Al Doyle, president of the Stuyvesant Town-Peter Cooper Village Tenants Association, said at a press conference held by New York Sen. Charles E. Schumer on January 31. “To us, Stuyvesant Town and Peter Cooper Village are our homes.” PCV/ST occupants have had to deal with a management merry-go-round for quite a while now, having experienced for changes in teams over the last nine years.