Brookfield sale at $3.5B could look like $68M added to affordable housing with transfer fee
A $3.5 billion sale of Brookfield Asset Management was announced Monday, with about 90 percent of the office space it owns in Cambridge – part of the company’s purchase of Forest City two years ago. The buyer is Blackstone, a global company with Cambridge offices at 101 Main St., Kendall Square. The deal is expected to close early in 2021, it is reported.
When people started talking in October about a potential Brookfield sale, the Toronto company was said to be seeking around $3 billion.
The City Council has been seeking a real estate transfer fee on large commercial and residential sales, but slow response from city staff has kept it from making its way to the state Legislature for the needed home rule petition. A transfer fee, which would contribute to the Affordable Housing Trust Fund that builds affordable housing citywide, was most recently tried in July, when the council agreed unanimously to send it off to the Ordinance Committee; it was heard there Oct. 28. But that committee report hasn’t made it back to the council.
The committee hoped to get the home rule petition before the Legislature as early as January, councillor Marc McGovern said in October. Boston and Somerville have their petitions filed – though they’re meaningless without a state transfer fee, said councillor Dennis Carlone, McGovern’s co-chair on the Ordinance Committee.
Efforts began four years ago. The council approved policy orders “requesting the city solicitor draft a Transfer Fee Home Rule Petition on Feb. 26, 2016; Jan. 7, 2019; and March 16, 2020; but no draft was ever produced,” the July order notes.
The fee could represent up to 2 percent of a real estate transaction. If it were in place for the Brookfield sale, councillor Patty Nolan said Monday, Cambridge’s efforts to build affordable housing could swell by up to $68 million.
“Hearing about this transaction makes me frustrated with city delays. Before I was on the council there was a request for a transfer fee. Had that been enacted in a reasonable time frame, the city would have between $34 million and $68 million – assuming the fee was 1 percent or 2 percent – more dollars for the Affordable Housing Trust,” Nolan said Monday.
In July, as McGovern spoke to ensure commercial property was included in the order, he said that “from 2014 to 2018, we would have generated $137 million for affordable housing, or roughly close to $28 million a year. We can’t leave big-time commercial developers off the hook.”
But the language includes commercial property such as Brookfield owns. It speaks to the transfer of “any real property interest or a controlling interest in a trust, limited liability company or other entity that directly or indirectly holds such real property interest in any real property” in the city.