As reported in the NY Post and subsequently on the Lux Living Blog, there's new legislation sponsored by Barney Frank making it's way through Congress that can theoretically help Tishman Speyer out with its financial problems with Stuyvesant Town and Peter Cooper Village. Titled "H.R. 3068: TARP for Main Street Act of 2009," here's the pertinent section of this bill that may help Tishman Speyer:
SEC. 5. MULTIFAMILY MORTGAGE RESOLUTION.
(a) Use of TARP Funds- Using the authority available under section 115(a) of division A of the Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5225(a)), the Secretary of the Treasury shall transfer $2,000,000,000 to the Secretary of Housing and Urban Development for use under the program developed under subsection (b) to stabilize multifamily properties that are in default or foreclosure, or have recently been foreclosed.
(b) Multifamily Mortgage Resolution Program- The Secretary of Housing and Urban Development shall develop a program under this subsection to ensure the protection of current and future tenants of at-risk multifamily properties, where feasible, based on criteria that may include--
(1) creating sustainable financing of such properties, that may take into consideration such factors as--
(A) the rental income generated by such properties; and
(B) the preservation of adequate operating reserves;
(2) maintaining the level of Federal, State, and city subsidies in effect as of the date of enactment of this Act;
(3) providing funds for rehabilitation; and
(4) facilitating the transfer of such properties, when appropriate and with the agreement of owners, to responsible new owners and ensuring affordability of such properties.
(c) Definition- For purposes of this section, the term ‘multifamily properties’ means a residential structure that consists of 5 or more dwelling units.
While I don't think Tishman Speyer could get its hands on this money (after all, TS can certainly get private capital to reinvest in STPCV and the company is not, overall, in dire straits), one can never tell how these things will go. No way should Tishman Speyer receive such funds unless there'd be a legal commitment to maintain affordable middle-class housing here.
This website tracks the progress of this bill through Congress.
As drafted in doesn't matter that TS is not in financial distress. The owners of STPCV are 2 special purpose entities set up by TS and those entities are likely in financial distress. Also TS can't get private capital to invest more money in STPCV.
ReplyDeleteI suggest everyone call Carolyn Maloney's office to have her add an amendment barring TS from these funds, at least unless they agree to stop deregulating apartments
I am going to do precisely as the first commentator suggested; this is an absolutely atrocious idea: Tishman Speyer don't need to be bailed out, they need to suffer the ignominious consequences of their own mismanagement. It is us, the tenants of Stuyvesant Town & Peter Cooper who need to be "bailed out" - saved from the continuing "mercies" of T/S.
ReplyDeleteIn reference to your closing statements: you might want to consider reading Free Lunch by David Cay Johnston.
ReplyDelete