The Real Deal New York

From the July issue: In 2006, a young Brooklyn developer envisioned selling 130 units in a
building he was about to construct, called the Viridian, in the
emerging Brooklyn neighborhood of Greenpoint. The developer, Joel
Schwartz, borrowed money at the height of the market and managed to
complete his project this past January. However, the lender on his $36 million first mortgage, Bank of New
York, withheld its final payment. Subsequently, the lender of a $12
million mezzanine note, which counted basketball legend Magic Johnson
as an investor, wanted to take over the property, so Schwartz was left
with little choice but to file for Chapter 11 protection in early
February. Schwartz’s attorney, Kevin Nash of the firm Goldberg Weprin Finkel
Goldstein, said his client made the right decision because he has a
viable restructuring plan and needed protections from New York
Community Bank and Canyon-Johnson Urban Fund, the joint-venture fund
between Canyon Capital Realty Advisors and Johnson’s development
corporation.