Buyers of Huge Manhattan Complex Face Default Risk
The New York Times reports: Three years ago, the sale of the 110 red brick apartment buildings at Stuyvesant Town and Peter Cooper Village in New York City amounted to the biggest American real estate deal of all time.
Now the buyers are running out of time and money. Tishman Speyer and partner BlackRock Realty, who together paid $5.4 billion for the quiet middle-class redoubt near the East River, have nearly exhausted an additional $890 million set aside for apartment renovations, landscaping and interest payments. Rents are down 25 percent from their peak.
Real estate analysts say that the partnership’s money will run out as soon as December and that the owners are at "high risk" of default on $4.4 billion in loans. Two real estate executives who have been briefed on the finances insist that the owners can hold out, but only until February.
The deal has become a "poster child" for all that was wrong with that era of easy credit, highly speculative deals and greed, said Ben Thypin, an analyst at Real Capital Analytics, a research firm.
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View the full article on The New York Times: Buyers of Huge Manhattan Complex Face Default Risk
Posted by: Matthew Stone