NEW YORK, NY July 10, 2007 —The Starrett City sale is no more. The federal government has quashed the $1.3 billion sale of the largest subsidized housing complex in the nation. WNYC's Cindy Rodriguez reports.

REPORTER: Clipper Equity, a local investment group spent the last few months trying to convince the Department of Housing and Urban Development it would keep Starrett City affordable. But in a letter yesterday, HUD Secretary Alphonso Jackson said the buyer did not demonstrate the organizational or financial capacity to manage the sprawling complex near Jamaica Bay in Brooklyn. Almost all local, state and federal officials opposed the deal including Brooklyn Congressman Edolphus Towns. He says the owners of Starrett will likely continue to look for another buyer.

TOWNS: We can't stop people from making money. We understand that but at the same time we must be about protecting people. Especially all those senior citizens who have been there for all those years.

REPORTER: A congressional hearing on preserving affordable housing will be held at Starrett City today. Towns says federal legislation that would further protect tenants at the Brooklyn complex will be discussed. Clipper Equity was not available for comment. For WNYC, I'm Cindy Rodriguez.