By Maria Rocha-Buschel
Less than two months after the announcement of the sale of ST/PCV, the city came to a similar agreement with Riverton Houses’ new owner A&E Real Estate to protect almost 1,000 low and middle-income homes at the development in Harlem, announcing that the property was sold for $201 million last Wednesday.
CWCapital had been in control of Riverton, a sister property of Stuyvesant Town/Peter Cooper, since 2010 after taking over from Larry Gluck’s Stellar Management. Stellar had bought the development in 2005, hoping to bring in higher-paying tenants, but defaulted on its $225 million mortgage and its lenders foreclosed.
The property was sold under an agreement to keep the remaining rent stabilized units affordable and in exchange, the city will provide A&E with property tax breaks and other incentives worth about $100 million. Affordability is being preserved through a real estate tax exemption, which will be provided for 30 years and was approved by City Council.
The apartments still under rent stabilization in the complex will be locked into a minimum 30-year affordability program with a five-year transition period to market rate after the 30th year. Advocates argue that this new affordability system reduces financial incentive for the developer to push current tenants out to drive the rents to market rate by restricting the rent on the units upon turnover.
Of the 1,229 apartments at Riverton, 975 remain in rent stabilization. About 250 of the units on the property have left rent stabilization and converted to market rate through vacancy decontrol and under the agreement negotiated with the city, the remaining apartments at risk will retain their current protections.
Under the new agreement, a third of the apartments still under rent stabilization would be available and affordable for low-income families making up to $46,620 and another third would be available and affordable for moderate-income households earning up to $62,150 for a family of three. The last third of the rent stabilized apartments would be restricted and affordable for middle-income households earning up to $96,125.
A&E Real Estate is planning to invest up to $40 million in new capital improvements to upgrade critical systems like boilers and elevators, in addition to commitments to new youth and senior programming, maintenance of the complex’s open space and quarterly meetings between tenants and management. Tenants will be receiving an 18-month moratorium on all MCIs and no increases from the work done in the first year and a half will be charged retroactively.
“It’s been our mission to keep tenants in their homes and keep Riverton affordable for the next generation,” Mayor Bill de Blasio said following the agreement. “This is preservation on a grand scale, and it is going to protect the kind of economic diversity that’s always been part of Harlem.”
Unlike Stuyvesant Town-Peter Cooper Village, which was originally segregated, owner Metropolitan Life allowed non-white people to move into Riverton.