Onyx Commences Development of Stuytown Solar Projects in New York City

November 8, 2017

Onyx Renewable Partners L.P., (“Onyx”), announces the commencement of development activities for the solar installations to be located at Stuyvesant Town and Peter Cooper Village in Manhattan. The projects were the subject of an article in the Wall Street Journal on November 7, 2017 which can be referenced online here:

Blackstone Group, Ivanhoé Cambridge to top 56 buildings in Manhattan apartment complex with 10,000 panels

By Peter Grant
7 November 2017
The Wall Street Journal

The Wall Street venture that purchased Stuyvesant Town and Peter Cooper Village two years ago for $5.3 billion is planning to turn the roofs of the sprawling apartment complex into Manhattan’s largest solar power producer.

Blackstone Group and Ivanhoé Cambridge are planning to spend more than $10 million to install close to 10,000 solar panels on the roofs of 56 buildings in the complex on the East Side. They will provide enough power for about 1,000 apartments annually, close to 9% of the total units in the 80-acre complex.

Blackstone executives say the project will triple Manhattan’s capacity to generate solar power. “You have 56 separate buildings with flat roofs,” said Nadeem Meghji, Blackstone’s head of real estate in the Americas. “That enabled us to roll out the largest private multifamily solar installation in the U.S.”

Blackstone, one of the world’s largest private-equity firms with over $385 billion of assets under management, has been aggressive in efforts to find energy cost savings in its global portfolio of commercial real estate, infrastructure, hedge funds and other investments. The company says it has been able to generate about $100 million in value through these efforts, which can be as pedestrian as installing more efficient toilet flappers in all the bathrooms of its hotel empire.

The company also recognizes the public-relations value of installing solar power in the heart of New York on a complex that has been a lightning rod for concern about affordable housing and other community issues. “When we made our original investment, we made a promise to be partners with the city and community,” Mr. Meghji said. “This is just an extension of that promise.”

The solar project isn’t likely going to produce a high return on the investment by Blackstone and Ivanhoé Cambridge, the real estate arm of pension fund giant La Caisse de dépôt et placement du Québec. Payback will be limited by the cost of installing panels on such tall buildings and the amount of power they can generate.

Still the owners of what is known as the Stuytown complex are very sensitive to the environmental concerns of its residents. It also runs one of the largest composting programs in the city.

“We take surveys of our tenants and we hear they care about these issues,” Mr. Meghji said.

Stuytown has long been considered one of the last middle-class bastions in a city that’s been faced with skyrocketing housing costs. Concern about its future intensified during the boom years when it was acquired by a venture led by Tishman Speyer and BlackRock Inc. for an eye-popping $5.4 billion.

That investment became a victim of the bust. After it ran into serious financial problems, the Blackstone venture swooped in and bought it.

New York has been a leader in building energy efficiency in the U.S., according to Russell Unger, executive director of the Urban Green Council. He said that between 2010 and 2015, existing buildings reduced energy use 10%, with a lot of the improvement coming from improvements to power plants and buildings converting from oil to natural gas.

Earlier this year, Mayor Bill de Blasio said that the city’s goal is to install 1 gigawatt of solar capacity by 2030, enough to power 250,000 homes. He said that the solar power generation in the city has more than quadrupled since the start of his administration.

The Blackstone venture has hired Onyx Renewable Partners as the developer of the Stuytown solar installation. It is expected to begin this winter and be completed in 2019.