Private equity firm Fortress Investment Group, which owns special servicer CWCapital Asset Management, may face several obstacles in its pursuit of massive Manhattan apartment complex Stuyvesant Town-Peter Cooper Village.
The firm announced it would make an offer of $4.7 billion after it receives cash financing from equity partners.
Credit Suisse Group AG analysts said in a report last week that it is unlikely that the building will sell right away. Tenants, other bidders and city politicians may well intervene, which could drag out — or even scuttle — the bid.
Indeed, tenants of the complex have reportedly been working with private equity firm Brookfield Asset Management to put together a bid for the property, which was built in the 1940s to house armed forces personnel in the aftermath of World War II.
“There is still considerable uncertainty as to when it will ultimately occur and the path that it will take,” the Roger Lehman-led analyst group told Bloomberg News.
CWCapital has been running the complex since the owners defaulted a $3 billion loan in 2010. The servicer might have a conflict of interest in a sale to its parent company, Bloomberg reported.
“In theory, there could be a problem,” lawyer Scott Tross of Herrick Feinstein told Bloomberg. “You do have a public auction situation, so there is an opportunity for other people to get involved if they want to. So I don’t think it is necessarily a problem.” [Bloomberg News] — Mark Maurer