Fall of Istithmar's Union Sq W Hotel, and its $117 Mill Mezzanine Debt takeover
Started by takkyamaguchi
about 16 years ago
Posts: 45
Member since: Feb 2009
Discussion about
Thought the sale of the Silverdome for $583K was a steal? Perhaps this deal signs a mark of confidence for the future of RE investments. The latest too cheap to believe foreclosure news comes as the W Hotel in Union Square went for $2 Million at an auction this month. Dubai's private equity firm invested a generous $282 million for the 270 room hotel back in 06. Makes you wonder what's going to... [more]
Thought the sale of the Silverdome for $583K was a steal? Perhaps this deal signs a mark of confidence for the future of RE investments. The latest too cheap to believe foreclosure news comes as the W Hotel in Union Square went for $2 Million at an auction this month. Dubai's private equity firm invested a generous $282 million for the 270 room hotel back in 06.
Makes you wonder what's going to happen to the rest of Dubai's RE Investments in the US, as those middle eastern firms are starting to seek a 6 month-1year standstill on debt repayments while they attempt to restructure their business.
http://online.wsj.com/article/SB10001424052748704825504574583910724856806.html
The winning bidder by the way, is now responsible for curing the two other pieces of mezzanine debt, totaling $97 million. (but still under 50cents on the dollar.)
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Response by Fayek
about 16 years ago
Posts: 269
Member since: Jul 2009
According to the real deal article the debt assumed by LEM was $212 Million plus $2M according to many they overpayed for this deal!
This is correct. The mortgage note was $115 Million + capital improvements and the defaulted amount from the previous two months.
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Response by nyc_sport
about 16 years ago
Posts: 809
Member since: Jan 2009
All of this is a bit misleading. LEM did not pay anything, but bid $2MM out of $20MM of its (already underwater) debt. As the real deal article says, this is merely phase one of a debt restructuring that took out the equity.
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According to the real deal article the debt assumed by LEM was $212 Million plus $2M according to many they overpayed for this deal!
http://therealdeal.com/newyork/articles/lem-acquires-w-union-square-at-201-park-avenue-south-for-2-million-at-mezz-auction-in-wake-of-dubai-debt-crisis
This is correct. The mortgage note was $115 Million + capital improvements and the defaulted amount from the previous two months.
All of this is a bit misleading. LEM did not pay anything, but bid $2MM out of $20MM of its (already underwater) debt. As the real deal article says, this is merely phase one of a debt restructuring that took out the equity.