Blackstone is in final negotiations to acquire Kips Bay Court, an 894-unit market-rate rental property, for $620 million. Owned since 1975 by affordable housing developer Phipps Houses, the eight-building complex between 26th and 29th streets east of Second Avenue changed hands for almost $700,000 per unit. It was developed by Phipps Houses featuring apartments with up to three bedrooms and rental rates ranging from $2,720 to $6,507 per month. Common-area amenities include a fitness center, a tennis court, a children’s playroom, a rooftop terrace, covered parking, along with 19,550 sqf of retail space. Forty percent of the units in Kips Bay Court are occupied by Section 8 subsidized tenants which deliver rents that are nearly market rate. The number of Section 8 apartments has fallen from 651 to 344 in the past dozen years. The offering memo forecasts that just 69 could remain by 2027, a number that represents just 8 percent of the complex. The purchase would represent the largest multifamily transaction in New York City in 2016.
