Charles V. Bagli, Dutton,

387 pages, $28.95


In 2009, Fitch Ratings valued the 80-acre Stuyvesant Town-Peter Cooper Village apartment complex in Manhattan at $1.8 billion. Unfortunately, it had been sold three years earlier for $5.4 billion.

The largest real-estate transaction in history had turned out to be a massive bust.

New York Times reporter Charles V. Bagli tells the horror story with clarity and authority in “Other People’s Money.”

The sale of the modest community by longtime owner MetLife to Tishman Speyer Properties LP and BlackRock Inc. was an ill-advised deal even before the financial crisis sent the property into a tailspin, Bagli explains. The buyers always knew rental income wouldn’t cover the payments on their massive mortgages for several years. So they put aside $400 million to cover the balance and counted on big rent increases that supposedly would kick in down the road.

Instead, the reserve fund ran out, and the owners missed $20 million in payments. They turned the property over to their lenders.

The infuriating problem brought to light in the book is a familiar post-financial-crisis tale: The buyers had only a small equity stake in the deal. The author says Tishman Speyer and BlackRock suffered relatively small losses — a combined $225 million, or 4 percent of the purchase price.

Five years after the 2008 credit crisis, we’ve had examples ad nauseam of the folly of financial transactions where dealmakers had no skin in the game. Often those stories lack the narrative that brings the devastation alive and sets your hair on end.

Not so Bagli’s account of the Tishman Speyer/BlackRock purchase. He takes readers on a walk through history’s biggest real-estate nightmare and lays out the facts in an evenhanded, no-hysteria style. But then again, he doesn’t need to hype the folly of his subjects, who handily hang themselves with their greedy actions and myopic decisions.