The two firms agreed to buy 2,800 market-rate rental apartments, with a plan to make them affordable.
(Bloomberg)—L+M Development Partners and Invesco Real Estate agreed to pay $1.2 billion for 2,800 Manhattan market-rate rental apartments, and plan to return the bulk of them to affordability.
The partnership is buying five buildings in Harlem and Roosevelt Island, according to a statement by L+M. The properties were developed under the state’s Mitchell-Lama affordable-housing policy, but left the program in 2005 and were no longer subject to rent restrictions.
All of the units will be subject to some type of rent regulation, according to James Yolles, a spokesman for L+M. About 1,800 of the apartments will be restricted to lower- and middle-income rent levels, with the rest remaining as market-rate units. The buyers agreed to restrict any rent increases for existing market-rate tenants, he said.
“This landmark transaction will reclaim a large portfolio of once-affordable housing and provide thousands of New Yorkers the security of knowing that they can afford to stay in their communities for years to come,” Louise Carroll, commissioner of New York City’s Department of Housing Preservation and Development, said in the statement.
The purchase was funded through the L+M Workforce Housing Fund, which raised $500 million to invest in affordable housing in New York City. The deal commits L+M and Invesco — and any future owner — to long-term rent regulation. Any future development on the sites would be restricted to affordable housing.
The seller was a partnership including Brookfield Asset Management Inc., according to a person with knowledge of the deal, who asked not to be identified because the details are private. A representative for the company declined to comment. A representative for Invesco didn’t immediately return an email.
The properties were built between 1975 and 1980 and include: River Crossing, the Heritage, the Miles and the Parker in East and Central Harlem; and Roosevelt Landings on Roosevelt Island.
A team at Cushman & Wakefield led by Doug Harmon and Adam Spies marketed the portfolio.
–With assistance from Natalie Wong.