Pat O'Connell
3:07:28
Thank you very much, council member Brewer and all other council members for the hearing today.
3:07:33
My name is Pat O'Connell.
3:07:35
I've been living and working in New York City for 41 years.
3:07:39
Currently live in the Upper West Side here representing a number of neighbors who are on the street, where an old school building was recently purchased by a private equity company that is starting to make tens of 1,000,000 of dollars on a small investment.
3:07:55
So the way I see the problem is what I call an arm's length relationship between the city and these private equity funds.
3:08:03
So my heart was breaking today when I heard, the commissioner as well as this lady here, you know, the people about the challenges in the health or in the shelter business, I should say.
3:08:15
But I think we're not really discussing what the what I call the elephant in the room, which are that some of these private equity fund, firms making, you know, collectively 100 of 1,000,000 of dollars.
3:08:26
So specifically, would I mention any company or any place, but you have a combination of, real estate companies selling buildings to private equity companies under one guise, and then the private equity company does a deal with one of the shelter providers.
3:08:43
And in this particular case that I'm talking about, the building was sold for 15,000,000.
3:08:50
The private equity company put on 5,000,000 with a, mortgage of 9,600,000 and they're gonna stand to make something like 28,000,000 in 9 years.
3:09:01
So not only will they get the pay off their mortgage, they'd also be able to, you know, get back their investment, but they're making, you know, essentially $28,000,000 and 5,000,000 investment.
3:09:13
As best we know, this company is doing this in multiple places in the city.
3:09:19
So this one private equity firm stands to make 100 of 1,000,000 of dollars.
3:09:25
And I don't blame anybody here, but it's a case of inadvertently the city is giving money into private hands.
3:09:32
So I would just ask you to think about that as you look at other issues.
3:09:35
And thank you very much for your attention.
