Setai

ok, let me rephrase this. yes they may or may not have the right to be a glorified bookie.

but do you think that's what their high level clients were looking for when they hired their investment advisors and bought their bonds? no? exactly.

you don't pay the big bucks to get reamed. or you do. and then you might or might not wonder whether or not it's worth it. and the drama queens may have prompted some people to wonder.

It is a joke that people blame the mortgage bankers like Mozillo or the Wall Street bankers like Blankfine. Why is the buyer of a house who didn't pay interest every month or postponed a higher interest by using an ARM or a multi billion international investor who bought synthetic CDOs not responsible for their actions? Were they tricked by slick salesmen or the unicorn fairy? Now stupid people are blaming others when they are responsible themselves. The international banks that bought the CDOs and put their citizens assets at risk without any investigation should be in jail. The owners who bought expensive houses and expensive kitchens, let they stay in their houses because who else will live there, but make their payments for 40 years and trade down their cars and take away their cable televisions.

AR
When it comes to ALL investment firms, I already know they are selling me shit. Goldman Sachs is no different and not special. There is a reason I have a stupid amount of cash in straight savings and checking accounts for the last 2 and a half years. I saw the sewage tank was full.
I even got stuck with Citibank tax free auction rate Nuveens that were advertised "as good as cash" that took almost a year to get rid of. The fault is still, mostly mine.

The problem still remains and not addressed. The deregulation of the nineties(without getting into who was President and who was in Congress) that allowed "regular" banks to merge, comingle, marry with brokerage houses and everything else under the sun was a mistake.
We have to have banks go back to being "real" banks and stop this sideshow nonsense. Mandate a timeframe 2,3 even 5 years for "real" banks to split away from the wild west elements and reverse all those ridiculous mergers.
Because the "real" banks no matter the size are always too big to fail and the only ones (fair or not) that should ever be bailed out.

Let's throw this into a real estate arena;
You feel your raw loft condo space in the East Village with a value of @ 2M in 2007, will dive in value,so you get a broker to sell it.
Next, your broker solicits a European buyer who feels the bull market has no chance of waning and will continue for 5 years and decides to buy the place. Your broker agrees with your opinion that it is a soon to be bad asset.
Next,your broker confirms the price is fair through an independant appraiser with the buyer's bank who's giving the mortgage.

Your broker (and you) give any information that is asked by the buyer, but not disclosing any misgivings about the future of the real estate market you or your broker may have.
He buys the property and a year, a year and a half later the property is worth 1M.

If you didn't lie about any info you and your broker were asked, are the two of you guilty of anything?

the broker has an explicit legal duty to the seller. the seller is the broker's client, not the buyer.

if GS wants to take the position that their buying clients aren't really clients, your scenario might work. i'm not so sure that's what GS wants to represent.

also, if they intentionally hired an unethical appraiser or coerced the appraiser in any way, then yes.

the interesting story, i think, is the purported pressure placed on the ratings agencies to inflate ratings. in a normal environment the shittiness of the deal would be reflected in the ratings, the price and you would select the investment based on perceived potential reward/risk tolerance.

AR
That goes without saying,let's face it, appraisers magically appraise to the contract value nearly all the time. Appraising has become a mere formality. How has the SEC been operating with already substancial laws?

To further make my RE point with your additional input, let's add that it was one brokerage house, say ABC Realty, and your broker conveyed to the european buyer "I am Bob the seller's broker, I recommend Neil at ABC Realty to be your buying broker." And the buyer takes Neil on. Asking all the wrong questions, "How much will a kitchen cost, how much will bathrooms cost." Will it take 2 months? 4 months?
What questions did Goldman Sach's clients ask? WHat is the yield? What are the taxes?

Sorry but I find there are plenty of rules in place,with not enough personal due dilligence.
There is just too much co-mingling all around.
And government should not be in business, it should be in enforcement only. If we can't put people like Charles Rangel in jail who flat out didn't pay his taxes among his other ventures, why should anyone else pay taxes?

So yes investigate GS if you like, but this banker witchunt is laughable. Without our governemnt cleaned up first, and enforcing existing rules and regs, what good is cherry picking who to punish in the GRAY arena.

i don't know if they're cherry picking or if they're just starting. probably the former because the latter would be too destructive to the too big to fail institutions.

but i do know this. the arrogance and greed demonstrated has been both breathtaking and awe-inducing. allowing it to go entirely unpunished is a slap in the face, and bad precedent going forward. will the punishment process be fair? of course not.

to extend your rangel analogy, if banks can get free money as a result of behaving as though risk doesn't exist, why can't others? etc. etc.

part of cleaning up our government is enabling, even requiring, the SEC to follow up on perceived criminal activities. did you read felix salmon's piece on the whistleblower who sent information on Fuld's income and never heard a thing, other than a thank you letter? yes, there have been significant regulatory capacity that has not been utilized. and now it's not such a bad thing to let the big boys know that it will be utilized going forward.

fundamentally i don't think we disagree that much. i just have absolutely no problem with something occurring for political reasons. you want rangel in jail. well, that's the one that bothers you the most. i think his orangeness destroyed lives, and many of them, so i'm heading my list with him. to each his/her own hit list.

Oh I know we dont disagree much and yes it's precisely that, one thing gets under one's skin more to one than another.
Rangel is just so obvious to me, he is a congressman. Hookers and bribes are one thing, paying taxes, the core of what enables our country to function has to be top of the list. Particularly by the very body that convinces us we have to pay them. It's as bad as cops who commit crimes. Zero tolerance.

I maintain again, this problem WILL happen AGAIN.....and AGAIN if we do not seperate the normal old school style bank from the investment banks.
The focus remains in the wrong place.

i agree. spin the investment arms of the banks back into partnerships. let the commercial banks be banks.

i'm not sure about bribes having less culpability than tax evasion, but it is rather interesting how and why spitzer was taken down. selective punishment at its most obvious.

Rental lobbyists like aboutready will go to such lengths to prevent home ownership that she is here in a discussion about a top downtown condominium talking about investment banks and our former Governor's resignation. What is the relevance to the Setai?

thanks...
has anyone any new information on the Setai?

yeah...any updates on how Setai is doing these days?
I see that they've been closing a fair amount of units in the past several months, does this indicate a comeback to normality for the building? Also, how is the new Setai in midtown opening up at the end of the year going to affect the prices of FiDi Setai? Any comments from current residents?

so quiet..anyone?

I closed on an apartment at Setai last month. The amenities are coming along nicely, and I definitely have high hopes for the building once construction wraps up. There have been dozens of closings in recent weeks, and I'm starting to see more move-in activity in the building. I'm an owner but also a broker, so feel free to contact me if you're interested in buying and I'll give you all the info. I know the floor and can definitely get rock-bottom pricing (they are definitely making deals). zach@urbanmktg.com

Aboutready, I saw you commenting on the Lucida too.

Why is there only one listing for the Setai. They have only closed 55 apts, so there are plenty available. Have they pulled the listings for a reason. It is often a sign of imminent foreclosure? Any news, inklings of foreclosure on the building coming?

One of the investors sued the developer. Not idea if that has anything to do with it or not.

http://www.observer.com/2009/real-estate/setai

Does anyone know why the tax appeal delayed? No one gave us clear answer.

Anyone have an updated point of view on the Setai? Or Spitzer?

From today's WSJ. Two things of note.

First, that sales have been suspended as a result of the construction loan being in default. I hate to say I told you so, but...
Second, the company that licenses the Setai name to the project is sueing the developer for using inferior products and materials.

Anglo Irish Bank Corp., the troubled bank at the heart of Ireland's controversial bailout, is raising cash by dumping New York real estate assets. Its latest move: putting up for sale a $147 million construction loan that financed the Setai Wall Street condominium and spa in the financial district.

The 34-story former office building, developed by Zamir Equities, was one of the most ambitious efforts by New York developers to transform the sleepy financial district into a thriving residential area. Units have sold for as much as $7.8 million, a record amount in the area, the developers say.

The Setai Wall Street towers over 40 Broad St. in downtown.
But the Setai Wall Street has run into problems. It got off to a fast start with about three-quarters of 162 units in contract, brokers say. But many buyers got out of their contracts last year after the project ran aground with construction delays and cost overruns.

Construction was completed earlier this year, and the developers kept marketing the project. Asher Zamir, a principal at Zamir Equities, says that buyers have closed on nearly 40% of the condos and another 10% are in contract.

The New York attorney general has halted any additional closings until the lending group, led by Anglo Irish, provides more information about the project's financing, according to Mr. Zamir. The Anglo Irish loan is in default, according to court papers.

Debt on troubled projects throughout the city has attracted investor interest since the downturn because it typically is sold for significantly less than the face amount of the loan. Brokers say there are a number of firms expected to make offers on the Setai Wall Street debt by Tuesday, the bidding deadline. The sale is being run by Holliday Fenoglio Fowler.

The sale comes as Anglo Irish has been trying to raise money by exiting some of its New York projects. The bank was nationalized last year after suffering huge losses from commercial property loans abroad that soured when global markets collapsed.

The bank already is trying to figure out a strategy for the $270 million in debt it holds on the Mark, a hotel and co-op conversion project on the Upper East Side. The developer of that project, Alexico Group, has spiffed up the hotel with a full renovation, including a new marble lobby and a trendy Jean-Georges Vongerichten restaurant. It's also been struggling to convert some of the hotel's 160 units into luxury co-ops. Alexico is in discussions with Anglo Irish about buying back its own debt from the bank, according to people familiar with the matter.

Also, earlier this year, Anglo Irish sold loans on two other Alexico New York hotels, the Alex Hotel and Flatotel.

Ireland on Sunday reached an agreement with European governments and the International Monetary Fund for an €85 billion ($113 billion) bailout. The funds will help recapitalize Irish banks that have been hit by bad loans. Anglo Irish and other large Irish banks have been under pressure to purge their portfolios of risky loans.

The Setai Wall Street, situated at 40 Broad St., is a converted office building that includes a private club, spa, fitness center, library, lounge, wine cellar and private screening room. It's also home to SHO Shaun Hergatt, an opulent Asian fusion restaurant. Like many other new developments, the project has struggled to find new buyers in the post-boom period.

The development also has run into problems with the Setai Group, a hotel and development company that is providing branding and design for the project. Setai filed a lawsuit in State Supreme Court in September alleging that some of the building's features are below Setai standards. The suit, seeking unspecified damages, alleges breach of contract for the developers not using "the highest quality equipment, fixtures, furnishings, finishings and supplies," among other things.

Mr. Zamir declined to comment specifically on the suit. But he said the property was a "five-star project."

According to the complaint, the developers initially asked between $815,000 and $7.9 million for condos.

In September 2008, the developers announced they had achieved a record price for a single-unit sale in the financial district with a penthouse apartment going for $7.82 million.

Closings were originally supposed to start in 2007. But the condo conversion suffered construction delays that postponed the initial closings. After several condo purchasers sued to get out of their contracts, the developers in the summer of 2009 offered buyers the right to rescind their contracts and get their deposits back. Most buyers took them up on the offer, brokers say.

The developers defaulted on the Anglo Irish debt in 2009, according to the Setai complaint. That loan was restructured but now that loan, too, is in default, the complaint states. Mr. Zamir declined to comment on the project's financing.

The Setai's lawsuit against the Setai Wall Street's developers is unrelated to a separate breach-of-contract lawsuit that the Setai Group recently brought against the Setai Fifth Avenue, a condo and hotel project near the Empire State Building, and a different developer.

yep, saw jrw sweeping chimneys the other day, but he's not upset....still best croissants south of Fulton.

Mr. Zamir declined to comment specifically on the suit. But he said the property was a "five-star project."

This was never a 5 star project. And when they close the spa, the owners will be left with dark, cramped apts with extremely poor layouts. Let's just assume they are all seriously underwater. If the buyers work on wall street they will have a short commute but little else will be left to them. And they probably can't sue because the Setai withdrew it's name. Managing contracts are usually exempt from liability in the condo contracts. Also the foreign investors who bought several apts in the building must surely have soured on NY real estate.

For someone who lives in Lincoln Square, you are very invested in a condo on Broad Street.

Today is the deadline for bids to be submitted to buy from the bank. A new developer with lower basis and new money to develop the hotel aspect of the project should result in a positive outcome.

Thus far the Spa is operating and the breakfast continues. The Setai suit had to do more with a small amount of money than issues of quality. The same action was filed on the midtown project.

If the note is purchased low enough, some developer may end up with a great purchase and significant upside.

From today's Real Deal...

FiDi Setai investor seeks to block deed transfer in $150M note sale
January 04, 2011 06:22PM

By Adam Pincus

Zamir principal Asher Zamir and the Setai Wall Street lobbyAn investor in the troubled Setai Wall Street condominium project in the Financial District filed a lawsuit against the developer and its lenders, including Anglo Irish Bank, to try and block the transfer of the deed which is being offered as part of a sale of the defaulted $150 million note.

Manhattan-based real estate firm Delshah Group filed suit in New York State Supreme Court, seeking a court order to block the transfer of a deed-in-lieu of foreclosure for Zamir Equities' Setai Wall Street, at 40 Broad Street. The deed transfer would follow the sale of the defaulted note. The note has not yet sold, court records indicate.

Delshah filed the lawsuit Dec. 20, its third lawsuit at the property, claiming it is the largest member of the entity that controls the deed and does not consent to a deed-in-lieu. Delshah asserts in a letter filed with the court that Asher Zamir, principal of Zamir Equities, agreed to a deed-in-lieu only in exchange for removing his personal financial guarantee.

Zamir Equities acquired the 34-story office property in 2005, and led the conversion that ran into cost overruns and construction delays. In 2007, Delshah paid $4.2 million for an ownership interest in the property.

In early July 2009, because of the building hold-ups, Attorney General Andrew Cuomo allowed rescission of 91 contracts totaling $110 million. In September of that year, the loans were restructured. As part of that arrangement, Anglo Irish claims in court papers filed in response to Delshah's latest lawsuit, that a deed-in-lieu was prepared in case of another default, permitting an easier sale of the property, court records show.

Sales continued and the building is now 50 percent sold, the Wall Street Journal reported last month.

In November, Anglo Irish Bank was said to be selling the note through Holliday Fenoglio Fowler as part of an effort by the Irish bank to unload its American portfolio.

Delshah was a bidder on the note, but did not win, Anglo Irish papers contend.

Delshah "is a disgruntled third-tied equity investor… in the failed 40 Broad Street rehabilitation project who is also a disgruntled bidder who sought to purchase (and now seeks to interfere with) Anglo's $150 million defaulted loan," the Irish bank said in its court papers.

Representatives from Zamir Equities and Anglo Irish did not respond to requests for comment. Broker Whitney Wilcox, a senior managing director at Holliday Fenoglio Fowler, said he could not comment on properties the firm is marketing.

Delshah's previous lawsuit in state court filed in October 2009 was rejected by a lower court judge but the company filed an appeal which is pending. A case filed in federal court in Manhattan in August 2009 is also ongoing.

Anglo Irish Bank is facing another recent lawsuit. Developers Isak Senbahar and Simon Elias of the Alexico Group are seeking $1 billion in a dispute over $500 million in loans from Anglo Irish.

WSJ Online
JANUARY 27, 2011
Developer Strikes Again .By CRAIG KARMIN

A New York City developer with a taste for busted property deals is back at it, acquiring the loan used for the conversion of the Setai Wall Street condominium and spa.

Ziel Feldman, head of HFZ Capital Group, had the winning bid for the $147 million construction loan for the Setai, say people familiar with the matter. His bid of about $80 million beat out more than a dozen other investors.

Mr. Feldman, a Queens-born former real-estate attorney, declined to comment on his plans for the Setai. But other property developers and lawyers say he will likely reach a deal with the developer, Zamir Equities, to take control of the building.

Asher Zamir, a principal at Zamir Equities, didn't respond to a request for comment on Wednesday.

.The loan, which is in default, was sold by Anglo Irish Bank Corp., the troubled bank that was nationalized last year after suffering losses on property loans abroad when the market collapsed. Holliday Fenoglio Fowler ran the sale.

In recent months, Mr. Feldman has picked up a number of other projects that had previously gone awry, acquiring them at sharply discounted prices.

He gained control of a prime development site near Bryant Park by buying the debt for $41 million and then cutting a deal with the owner, paying him an undisclosed amount.

The owner had been planning to build New York's first "green" luxury hotel there. Mr. Feldman has put the site, currently a 12,000-square-foot parking lot, up for sale, according to a person familiar with the matter.

Before that, Mr. Feldman paid about $38 million for the debt on a stalled residential development on East 51st Street that was the site of a crane accident in 2008 that killed seven people.

Mr. Feldman's HFZ Capital also is teaming with Cevdet Caner, a real-estate developer currently living in Monaco, in vying for control of a long-stalled high-rise project called One Madison Park, according to court documents and a person familiar with the matter. The unfinished 50-story Manhattan condo, which is in Chapter 11 bankruptcy protection, became a potent symbol of how quickly the housing boom turned to bust, leaving once-promising projects in the lurch.

Ross Moskowitz, a real-estate partner at Stroock & Stroock & Lavan, says HFZ could either look to flip the Setai building, as Mr. Feldman appears to be doing with the Bryant Park site, or invest in the project with a view toward a three- to five-year investment plan.

Part of that decision could also depend on whether his financing is long or short term. Mr. Feldman, like many developers these days, often raises money rather than putting a lot of his own equity into a deal.

Given that the Setai already has tenants, including a spa and an Asian fusion restaurant, Mr. Feldman has incentive to run it for the longer-term, Mr. Moskowitz says. He would be able to cut prices to boost sales because his debt load is about half what the developer faced, Mr. Moskowitz says.

The 34-story former office building initially had sales contracts for more than half of its 162 condo units. But the New York attorney general released buyers from those obligations in 2009 after the project ran aground with construction delays and cost overruns, according to condo documents.

Mr. Zamir said in November that buyers have closed on about 40% of the units, and another 10% are in contract.

The New York attorney general's office has halted any additional closings because of questions about the project's financing. The developer also ran into problems with the Setai Group, a hotel and development company that alleged in state court that some of the building's features are below Setai standards.

The Setai, seeking unspecified damages, alleges breach of contract. Mr. Zamir has declined to comment on the suit.

The sale of the Setai loan was part of Anglo Irish's plan to raise cash by dumping real-estate assets. The bank previously sold loans for Manhattan's Alex Hotel and Flatotel, and is trying to find a buyer for a $270 million loan for the Mark, a hotel and co-op conversion project on the Upper East Side.

Anybody know what is going on with this building? I heard sales have resumed. Anybody heard any details about pricing, etc?

hi all, i am seriously considering buying there. when they quote square footage, are they including common areas / spa / gym, etc. I know many places like this do. live and work in chelsea and frustrated with what is available in downtown for the money. seems like setai is a good "deal"?

Do you have any idea what the new owner's plans/intentions with the building? What is the status of the Setai Group law suit? If the name Setai is dropped from the building, would that affect the value of your purchase. If the spa turns into just another "gym" without the fancy services, would that affect your decision on value? Square footage seems like the easiest decision. Measure the apartment, that is what you will be living in and what you will be paying for

I looked at the Setai a few weeks ago. The person who showed me the apartment (he worked for the new owner) said the lawsuit had been settled and the building had use to the Setai name in perpetuity. If I was to have considered buying there, I would have had my lawyer verify that. I ultimately didn't make an offer. While the price per sq foot is pretty good, the lay-outs were just not user friendly. Way to much wasted space. Plus the common charges seemed high to me. While you get a lot of amenities, it just didn't justify the price.

anybody have thoughts now with the new price drops?

"Everyone knows that “there ain’t no such thing as a free lunch.” But what about a free breakfast? That’s what one New York lawyer is insisting upon in a $730,000 lawsuit filed on Tuesday against his posh gym, the Setai Club & Spa Wall Street…."

http://abovethelaw.com/2011/11/theres-no-such-thing-as-free-breakfast-when-youre-a-lawyer/

I assume croissants still on the menu.

G-d I miss this thread.

If he succeeds then new buildings might think twice before they scrap the perks that attracted the buyers in the first place. Think of it as Occupy Wall Street Setai.

>G-d I miss this thread.

There was actually a poster here named whorecounty1??

I'm considering buying a 1 bedroom at the Setai. Saw a few units and the price per sq. ft seems reasonable but the common charges are high! Anyone knows what's driving the higher than average common charges (even for FiDi which averages around 1.20-1.30 per sq. ft) - I'm looking at close to 1,500 for a 1 bedroom in common charges. Any insight or views about the building would be appreciated. Thanks.

Considering manahattan's tight inventory, there are a lot of units available here.
Common charges are already ridiculous, expiring tax abatement is going to crush this building.

Nick: It might be the free croissants for breakfast flown in from I believe Paris. Maybe they should bring them in from Montreal instead.

Why on earth wouldnt you rent here instead of own.

"licenses the Setai name"

That's pretty hilarious. "Setai" is a thoroughly-generic Japanese word for "home" or "household". There are literally millions of "households" who can claim prior art on this trademark.

Well T-zero you know it doesnt work that way.
Same reason you can't just put "La Yogurt" on your brand of yogurt.
Regular words in a secondary language are easily trademarked in the host country.

It would be fairly easy to to own the word "Home" in Japan. You could even do it here with a specific font and logo.

Hmm -- I wonder what's happened to jrw293 and Mota, now 5 years later...

I had Setai for dinner last night, mmmmmm

Too bad these haters didn't buy 4 years ago, they'd be up 30% now. Oh well.

30% in 4 years!

Now its 30% up from 10 years ago! LOL
My god this thread was funny but on a serious note, why is this condo building only trading in the $1100 per square foot these days?
You would have fared better with a T-bill.

I come back to this thread sometimes to re-read the whole thing. Easily one of the finest examples of StreetEasy wit and humor from the good ol’ post-bubble days. Great escapism from the world of COVID...

This one was a gem lrschober. Thanks for making me reminisce through the thread.

It will be interesting to see how Feldman copes with potentially being on the other side of one of these with The XI.

truthskr10, I have to give you credit, I've used your line from this thread before, "This place has the best croissants south of Fulton" in the real world in conversation, and it always gets a laugh.

Looking back at this thread makes me think back on the other recession characters that came through these forums.

Who remembers Junkman, champion of Downtown Brooklyn and an overly-zealous prophet of the Toren condo on Myrtle Ave? He must have eaten dirt on a closing that never happened.

Or rufus, aspiring New Yorker and dejected Chicagoan who wanted nothing more than to get into Columbia University and move here, and coped with his college rejection by focusing on the lack of alleyways NYC has to store building trash awaiting pickup.

Jim Hones was a huge jerk, and I never could figure out what his deal was.