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In a transaction considered the biggest American real estate deal in history, a joint venture of Tishman Speyer Properties and BlackRock Inc. purchased two neighboring apartment complexes in New York City from MetLife Inc. for $5.4 billion. The sale, which closes at the end of 2006, will secure Tishman Speyer’s ownership and management of all 11,232 apartments-73% of them rent-stabilized-within 110 red-brick buildings, situated on 80 acres. The 8,757 units within the Stuyvesant Town complex are located between 14th to 20th streets in Manhattan and the roughly 2,500 apartments in the adjacent Peter Cooper Village, which are slightly pricier, lie between 20th and 23d streets. Both complexes cover a stretch of land that is more than half a mile wide. MetLife was represented by Greenberg Traurig partners Daniel J. Ansell, Robert J. Ivanhoe, Stephen L. Rabinowitz and Steven Shapiro, along with of counsel Steven N. Kirkpatrick. Reed D. Rubinstein, of counsel to the firm’s Washington office, was also involved. Jonathan Mechanic, a partner at Fried, Frank, Harris, Shriver & Jacobson of New York, advised Tishman Speyer and BlackRock, as did partners Daniel J. Bursky, Brian Kniesly, Jonathan F. Lewis, Richard M. Schwartz and Harry R. Silvera, and associates Daniel W. Finley, Ann Tyson, Jennifer A. Yashar and David A. Zilberberg. Former ‘Gashouse District’ The complexes were constructed by MetLife in 1947 on the site of the former Gashouse District, 18 city blocks occupied by public facilities, churches and, as the name implies, several gas tanks. The development was controversial for being built on predominately public premises, but eventually won favor because it provided affordable living quarters for returning World War II veterans. It also began to house middle-income groups such as police officers, nurses and teachers. At first, MetLife rejected nonwhite tenants. Three black veterans filed suit in 1947 but lost when the U.S. Supreme Court determined that private owners could discriminate freely. A few years later, MetLife voluntarily began accepting nonwhite tenants. As of now, just below 10% of the complexes’ population is black. Long-term tenants are still paying rents between $1,000 and $2,000 per month. But MetLife has been raising rents on vacant apartments. Currently, rents for nonstabilized one-bedrooms range from $2,625 to $3,050 per month; two-bedrooms are leased from $3,350 to $3,950; and three-bedrooms run from $4,700 to $4,950, a far cry from the 1947 rate range of $50 to $91 per month.

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