From Bistricer to Rockpoint: The new Starrett City deal is a far cry from what might have been “You couldn’t go at this like a piñata.”
From left: Doug Harmon, Andrew MacArthur, President Trump, David Bistricer and Starrett City (Credit: Starrett City and Getty Images)
Just 10 years ago, the largest federally subsidized housing development in the U.S. almost went market-rate.
At the height of the boom in 2007, with the owners planning to exit the Mitchell-Lama program, David Bistricer made a whopping $1.3 billion bid for Starrett City, the hulking 5,881-unit complex that straddles Canarsie and East New York. But the deal faced intense opposition from government officials and the community, and federal regulators ultimately blocked it.
“When they tried to sell it to us, the owners said they planned to take it out of the Mitchell-Lama program and officials were very upset,” Bistricer, who heads Clipper Equity, recalled. “At the time, the sellers weren’t considering affordability in order to achieve that price.”
Any similar play at Starrett City was seen as untenable, given the scrutiny that came with its status as a stronghold of affordability within an increasingly unaffordable city. That the 2006 Stuyvesant Town-Peter Cooper Village sale ultimately became a debacle didn’t help either. So when Rockpoint Group and Brooksville Company made a go at it this year, the only viable route was the affordable one. The price they agreed to pay for the complex reflects that – at $850 million, it is nearly 35 percent lower than Bistricer’s 2007 offer.
And while the Bistricer talks happened in an overheated market where the name of the game was leverage and aggressive destabilization, the climate in which this deal came together was starkly different, and so was the process by which the suitors were targeted.
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