L+M Development Exploring Purchase of Knickerbocker Village
Knickerbocker Village, one of the largest residential complexes in the city, is exploring a possible sale to L+M Development Partners, several tipsters tell us.
Current management has reportedly been in ongoing negotiations with the prospective buyer, price unknown. And even though the deal is not yet final, tenants are concerned about the fallout. Namely the proposed 2.5% to 3.0% annual rent increases, and the rents on vacant units (determined by the AMI of the surrounding area).
Knickerbocker Village, which consists of twelve 13-story buildings, has long been the most affordable housing option in the Chinatown area. Several years ago, management explored the idea of conversion to co-op, a move which drew opposition and concerns of potential real estate speculation. However, that proposal was eventually squashed when New York State intervened and ordered the potential buyers at the time to cease and desist. Then, in 2019, City Council passed a bill that keeps the complex affordable for the next fifty years in exchange for an annual tax abatement of $3 million.
This latest deal comes months after L+M sold its stake in another Two Bridges housing complex – Lands End II – for a collective $435 million.
Knickerbocker Village residents were devasted during hurricane Sandy when the basement flooded, causing extensive damage to the electrical systems. As a result, several buildings went without power for over a month and management scrambled to repair. The district’s elected officials fought for, and netted Knickerbocker Village the aforementioned tax abatement to stave off proposed rent increases (allegedly to fund repairs). Apparently the abatement was an attractive selling point in what appears to be a bait and switch.
Meanwhile, Chinatown has lost its appeal to new immigrants as a settlement point due to increasing rents caused by property tax assessments and gentrification. This possible loss of nearly 1,600 affordable housing units would be further devastating.
Councilwoman Margaret Chin’s office is aware of the talks, and purportedly involved, there remains a trust issue with her due to her past pro-development stance.