But the new rent laws made the regulatory agreement with Blackstone redundant by effectively regulating units that have been regulated as long as the rules remain in force, regardless of the sunset date of the 2035 agreement. A spokesman for Mayor Bill de Blasio did not respond to a request for comment. In 2015, de Blasio courted Blackstone, the largest of its kind, for the preservation of a bourgeois oasis. While some critics said the government had exaggerated the benefits, the agreement guaranteed a long period of accessibility for Manhattan`s largest apartment complex, built after World War II for returning veterans. Under the former owner, Tishman Speyer, who paid $US5.3 billion for the complex in 2006 – the same price as Blackstone in 2015 – Stuy Town had become a warning story of real estate speculation at a time when over-indebted landlords were aggressively trying to relocate tenants to relocate homes and increase rental income. “This is an opportunity to bring renters into new regulatory agreements that can bring in new affordable units,” he said. With respect to affordable housing, questions were raised about the impact of the new rent laws on landlords who may have entered into similar regulatory agreements in which regulated units would be deregulated at a later date. Asked about the impact in July, a spokesman for HPD gothamist said agency staff “continues to analyze the potential impact of legislation on current and future business and cannot speak to it at this stage.” Blackstone, however, said he was still fulfilling his pact with the city. Not all regulated units are covered by the 2015 settlement agreement.
Even owners of regulated rental apartments are not legally required to rent them permanently. The source on Blackstone said the company spent an average of about $100 per square metre on renovations for apartments that had previously been occupied by long-term tenants and remained largely intact. Despite facility regulations, more than half of Stuy Town`s units are leased at market prices. In 2015, a report by the Independent Budget Office estimated that Stuy Town had nearly 5,400 traditionally rent-adjusted units, with an average legal rent of $1,700. On Tuesday, HPD did not respond to questions about Stuy Town and what led to the audit. Instead, the Agency`s spokesperson made the same statement last week. “We take this very seriously and are conducting a thorough review in partnership with the state,” the spokesman said. “The city will do everything in its power to maintain housing availability and help hard-working New Yorkers find an affordable place to live.” “They`re doing an economic calculation,” he said.
Nevertheless, he said that in the face of the affordable housing crisis, the city should not allow homeowners to move units away from the market. “We will continue to meet our commitment to voluntarily secure 5,000 affordable housing units, and we will invest hundreds of millions of dollars in capital improvements, including the completion of New York`s largest solar project,” said Jennifer Friedman, a Blackstone spokeswoman. Friedman added, “Unfortunately, with the new legislation, we have to make difficult decisions and reduce some investment.” In one of the most dramatic measures taken by homeowners as part of the review of government rent laws, the owner of Stuyvesant Town-Peter Cooper Village chose to keep some of its regulated units empty, instead of potentially blocking tenants with significantly reduced rents.