With dozens of 20-story apartment towers looming behind her, Lashonda Carmichael looks out over a frozen inlet to the bay and the world beyond Brooklyn.
"This is where I come for peace of mind," she says as she balances her 2-year-old son on her hip.
Since she was a child, Ms. Carmichael has roamed these shores on the edge of this massive, affordable housing complex where she grew up. Most New Yorkers know it as Starrett City. Global economic forces now threaten to disrupt her calm and that of the almost 14,000 other tenants, almost 90 percent of whom pay rents below market rates.
That's because the complex is still on the auction block for a whopping $1.3 billion, despite Friday's decision by the federal government to block the sale. While the decision is a major blow to the proposed buyers, they insist they are committed to making the deal work.
Starrett City, although privately owned, is the nation's largest affordable housing complex because of various state and federal low-interest mortgages and subsidies.
In many residents' estimations, it's also the most successful – a racially and ethnically diverse, well-maintained community that operates with its own schools, parks, power plant, and shopping center. They see it as a safe city within a city. Most tenants pay up to $1,200 monthly for the apartments. But the proposed $1.3 billion price tag has fueled tenants' concerns that rents may skyrocket.
"I just hope I'll be able to pay the rent," says Fred MacKenzie, a retired garment industry worker who has lived here since 1993. "That's the world today, those with the money buy what they want, and I can't stop them."
Economists chalk up Starrett City's high price to the billions of investment dollars pouring into the nation's commercial housing market from places like Australia, India, and China. That money is now driving prices for apartment buildings in hot real estate markets such as New York to historic highs. In November, investors paid a record $5.4 billion for Peter Cooper Village and Stuyvesant Town, adjacent affordable housing complexes in Manhattan.