Blackstone, a major private equity firm, is compensating some New York City tenants with payments in excess of $100,000 each to settle claims of overcharging for their rent-stabilized apartments. This was revealed Tuesday by court documents and a statement from a housing watchdog group.
The settlement, totaling nearly $15 million, involves dozens of tenants who will receive substantial payments in the range of thousands. Furthermore, according to the tenants’ legal representatives, this is one of the largest settlements in New York State history for cases of this nature.
The settlement ends a 2018 class action lawsuit filed by residents of Parker Towers in Queens against the property’s previous owner, the Jack Parker Corporation, and Blackstone, which acquired the complex in the same year. Parker Towers, a building with more than 1,300 housing units, had previously qualified for lucrative tax breaks under a municipal program aimed at supporting apartment renovations while maintaining rent-stabilized condition.
“This settlement is more than just financial compensation for these families,” stated Aaron Carr, founder and executive director of the Housing Rights Initiative. “It represents more resources for essentials like food, health care, and housing in one of the most expensive cities in the world.”
Specifically, Blackstone sought to resolve the case shortly after acquiring the complex but spent years negotiating with Newman Ferrara, the law firm representing the tenants.
While the settlement includes no admission of wrongdoing, Blackstone acknowledged in court documents that overcharges had occurred in the past. In a statement, the firm expressed satisfaction with resolving the dispute, noting that the case originated before it took ownership of the property. Blackstone highlighted its $70 million investment in the complex and reaffirmed its commitment to “delivering an exceptional resident experience.”
However, the Jack Parker Corporation declined to respond to requests for comment.
This settlement highlights the challenges renters face in navigating New York City’s complex rent-stabilization system, which often makes it difficult to hold landlords accountable. Covering approximately one million apartments, nearly half of the city’s rental units, the system serves as a crucial source of affordable housing.
Tenant advocates and city and state officials urge residents to obtain their apartment’s rent history from the New York State Division of Housing and Community Renewal, which oversees the rent-stabilization system, to identify potential irregularities. However, these records can be difficult to interpret, and the state does not guarantee their accuracy.
Aaron Carr criticized the state for not taking a more proactive role in investigating such cases, noting that many others like Parker Towers remain unresolved.
“The burden is unfairly placed on everyday people who don’t have the time or expertise to navigate thousands of pages of real estate law,” Carr claimed.
The New York State Division of Housing and Community Renewal reported that it has recovered nearly $13.2 million in rent overcharges for tenants over the past five years. In the fiscal year ending in 2023, the division handled 800 rent overcharge complaints—more than twice the number processed just two years earlier. Additionally, the division’s Tenant Protection Unit launched over 2,800 investigations statewide during the same period, according to the department.
In 2019, Blackstone agreed to pay over $1 million to current tenants of the complex who alleged they had been overcharged.
Now, an additional $14.75 million is being distributed to more than 100 households, including former residents, according to court documents. The settlement was approved by a judge in September.
