Of the many blows the 21st century has so far dealt to tenants in New York, few were as bruising as the one that landed on Stuyvesant Town–Peter Cooper Village. “It was,” New York senator Chuck Schumer told tenants on Saturday, “one of the most despicable acts of corporate greed I have ever seen.”

Between 2002 and 2015, a succession of owners systematically dismantled the affordability of Stuy Town, the largest complex of rental apartments in Manhattan – a near-mythical urban village that stood for nothing less than the achievements of New York’s middle class.

The collection of 110 red-brick towers remained physically intact, but its character changed dramatically, as its owners ended a 50-year commitment to rent-stabilised, middle-income housing in order to profit from New York’s housing crisis. In 2001, fewer than 100 of Stuy Town’s 11,000 apartments were rented on the open market. Today, more than half of them are.



It was one of the most despicable acts of corporate greed I have ever seen Senator Chuck Schumer

But last week’s announcement of the sale of Stuy Town to Blackstone, America’s largest rental landlord, will fix that ratio for the next two decades. The deal stipulates that 5,000 apartments will remain rented to middle- and low-income tenants.



It’s a victory beyond numbers – proof that affordable housing can still be a municipal priority on Manhattan island if determined tenants and public officials make it one. But it’s also a coda to a cautionary tale.



Since it opened in 1947, this miniature city on the East River has had lofty aspirations. It was the fruit of a partnership between New York mayor Fiorello La Guardia and the Metropolitan Life Insurance Company, whose chairman, Frederick Ecker, described the goal: that “families of moderate means might live in health, comfort and dignity”. His words were engraved on a plaque at the centre of Stuy Town.

The plaque disappeared in the early 2000s. The complex was sold. Now a one-bedroom apartment, 15 minutes from the subway, fetches $3,300 (£2,150) per month.

Jonathan D Gray of Blackstone (centre) is joined by New York City mayor Bill de Blasio (left), council member Dan Garodnick and Stuyvesant Town Tenants Association president Susan Steinberg. Photograph: Mary Altaffer/AP

As a result of the Blackstone deal, Stuy Town will be cleaved into two divergent communities. The first will be paused in time, an inaccessible exhibit of mid-century progressive values; the second, an expensive urban neighbourhood in the tumult of market efficiency.

It was the grey-haired residents of that first Stuy Town who packed an auditorium on Saturday afternoon to hear Schumer, New York City mayor Bill de Blasio and local council member Daniel Garodnick praise their perseverance. (The 43-year-old Garodnick, a lifelong Stuy Town resident, might have been the youngest person in the room). Susan Steinberg, the president of the Tenants Association, endorsed the deal. “I feel that we have saved our community as a middle-class enclave,” she said.

De Blasio, meanwhile, called it the largest affordable housing preservation agreement in the city’s history.

In 2001 fewer than 100 of Stuy Town’s 11,000 apartments were rented on the open market. Today more than half are

Many longtime residents, however, were apprehensive. In 2006, after commercial real estate company Tishman Speyer bought Stuy Town, president and CEO Rob Speyer cordially assured residents that he valued the community and its culture. Then the company launched a frenzied hunt to drive up revenues. “There was a terrible feeling that the sword was going to fall,” said a retired teacher who has lived in Stuy Town for 39 years. “Especially for old people who’ve lived here all their lives. It’s late to start your life all over again.”



Looking at its exterior, it’s not obvious that Stuy Town is split between two classes of tenants. The unadorned brick towers are arrayed over 20-odd blocks of Manhattan, like a city planner’s lost Tetris game. They appear to be as monotonous in culture as in architecture. The luxury apartments aren’t all in one block, but are sprinkled between floors and between buildings. There are few visible “rich-poor” contrasts here: no dive bars abutting boutiques, no homeless men beside condo doorways.



Stuy Town has always stood apart: in the early days, a bulwark against the surrounding slums; more recently, as Lower Manhattan became one of the world’s most expensive places to live, one of the last bastions of downtown’s middle class. According to the Tenants Association, in 2000, more than 20,000 families were on the waiting list for apartments in Stuyvesant Town-Peter Cooper Village.

Since its construction, Stuy Town made money for “Mother Met,” as tenants called their benevolent landlord Met Life. But when the company went public in 2000, it was already obvious that the 80-acre tract was a potential goldmine. Enterprising landlords began to eye the property, knowing that if they were able to pay for sufficiently costly renovations to an apartment (a percentage of which could legally be added to the rental value) and push the rent above $2,700 – thus removing that apartment from New York’s rent stabilisation program – they could then hike the rent to whatever the market would pay.

“I think most young people would say there are too many old people here, and most old people would say there are too many young people” ... Stuyvesant Town. Photograph: Bloomberg via Getty Images

After Met Life announced in 2006 that it would sell Stuy Town, prospective buyers made wild projections of potential residential turnover. No bet was more ambitious – or more wrong – than that of Tishman Speyer, whose winning bid reached $5.4bn. To meet their optimistic figure, the company had to move hundreds of rent-stabilised apartments into the market each year. Met Life had already begun to convert hundreds of apartments to market-rate value when tenants died or moved away. Tishman Speyer’s strategy, however, explains Benjamin Dulchin, the director of affordable housing advocacy group the Association for Neighbourhood and Housing Development, was “predicated on kicking out the majority of the tenants as soon as possible”. To this end, they hired investigators to find out if tenants were abusing lease terms, such as by subletting or living elsewhere most of the year.

As the New York Times’ Charles Bagli reported in Other People’s Money, Tishman Speyer issued more than 1,000 eviction notices based on that research, and, whether after a court fight or not, roughly half of these residents left. In 2009, a New York State Appeals Court ruled that Met Life and Tishman Speyer had illegally deregulated more than 4,000 units.

The company declined to discuss Stuy Town or the new sale. But in 2009, a spokesperson denied being too aggressive in eviction efforts, telling the New York Post: “We do our homework without violating our residents’ privacy.”

Many of the new tenants – including a good number of New York University students – now pay enormous sums to live in apartments that have been subdivided to accommodate more people in smaller bedrooms. In another world, they might have been the natural allies of their tenured neighbours. But the relationship, while not quite fractious, hasn’t been productive.



“Instead of a place to put down roots, they see it as a stopgap,” said Steinberg, the Tenants Association president, who moved to Stuy Town in 1980. Merrick Bursuk, a writer who moved to Stuy Town in 1981, was more blunt: “You have people who don’t give a damn. They’ll be out in two years.”



The sense of division is mutual. “I think most young people would say there are too many old people here, and most old people would say there are too many young people,” one younger tenant ventured.



That gap will be hard to bridge. Market-rate tenants might be criticised for lacking the sense of community involvement that is considered a classic Stuy Town virtue – but their rents are climbing steeply each year. They’re most likely to leave not because of generational or cultural differences but because they can no longer afford to live there. The 5,000-unit victory doesn’t belong to them.



That mythical middle-class village where parents passed apartments to their children? It still exists. It’s just half as big as it used to be, and harder to join than ever before.

“It’s a good moment for Stuy Town,” said Dulchin. “It’s good that the city fought there, used the leverage they had and got some affordability saved. But the long-term story of Stuy Town is a tragic one.”

Follow Guardian Cities on Twitter and Facebook to join the discussion