Paramount Realty’s Misha Haghani, m127

Paramount Realty USA has closed on the last unit at Cardinal Investment’s m127 condominium — a three-bedroom duplex penthouse — for $2.18 million, or $965 per square foot. “We are very pleased to have totally sold out the entire building,” said Misha Haghani, a principal at Paramount Realty USA, the auction company that sold the building’s five other units at a June 27 auction, netting a total sale of approximately $9 million. Paramount Realty USA’s June auction of the m127 condo units — at 127 Madison Avenue between 30th and 31st streets — was attended by 400 people, and was the first developer auction of a Manhattan condominium development in almost 20 years. “The auction model is a powerful way for sellers to regain leverage in a buyer’s market,” added Scott Burman, another principal at Paramount. TRD

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Troubled community lender Smithtown Bancorp has entered a deal to be
acquired by People’s United Financial of Bridge [more]

The last six apartments at the 12-story M127 condo — which had been on the brink of foreclosure after a failed sales attempt — sold out at a Roosevelt Hotel auction yesterday in a little more than an hour, according to the Wall Street Journal. It was the first successful auction by a Manhattan developer — Cardinal Investments — in over two decades, said Misha Haghani of Paramount Realty USA, who ran the event. More than 100 registered bidders attended, and winners paid an average of $840 per square foot for the apartments — a major discount. A 1,577-square-foot apartment sold for $1.24 million, 25 percent less than what a similar apartment fetched in 2008. Cardinal, which had sold only three units in the nine-unit building at 127 Madison Avenue in early 2008 and had nearly $9 million in debt on the property, yanked the remaining six homes from the market during the downturn. As The Real Deal reported last year, Cardinal was illegally renting those homes in the interim to short-term and extended-stay hotel guests. [WSJ]

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The last six apartments at the 12-story M127 condo — which had been on the brink of foreclosure after a failed sales attempt — sold out at a Roosevelt Hotel auction yesterday in a little more than an hour, according to the Wall Street Journal. It was the first successful auction by a Manhattan developer — Cardinal Investments — in over two decades, said Misha Haghani of Paramount Realty USA, who ran the event. More than 100 registered bidders attended, and winners paid an average of $840 per square foot for the apartments — a major discount. A 1,577-square-foot apartment sold for $1.24 million, 25 percent less than what a similar apartment fetched in 2008. Cardinal, which had sold only three units in the nine-unit building at 127 Madison Avenue in early 2008 and had nearly $9 million in debt on the property, yanked the remaining six homes from the market during the downturn. As The Real Deal reported last year, Cardinal was illegally renting those homes in the interim to short-term and extended-stay hotel guests. [WSJ]

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Six units at M127, a newly developed condo at 127 Madison Avenue between
30th and 31st streets, will be auctioned off Sunday afternoon, as The Real Deal reported last month. Five two-bedroom units are available, plus a 2,255-square-foot duplex penthouse. Developer Cardinal Investments decided to put the nine-unit development up for auction after its sales attempts failed, Crain’s said. After selling only three units in early 2008, the developer took the remaining six units off the market for a year during the recession. Last year, Cardinal Investments appeared to be illegally renting out the unsold condos in the building. The Bank of Smithtown filed a foreclosure action on the property, whose debt was valued at nearly $9 million. Sources told Crain’s that the auction was a way to help the firm work out its problems with the bank while avoiding lengthy litigation. The auction, the first of its kind in Manhattan, will be conducted by Paramount Realty at the Roosevelt Hotel in Midtown.[Crain's]

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Six units at M127, a newly developed condo at 127 Madison Avenue between
30th and 31st streets, will be auctioned off Sunday afternoon, as The Real Deal reported last month. Five two-bedroom units are available, plus a 2,255-square-foot duplex penthouse. Developer Cardinal Investments decided to put the nine-unit development up for auction after its sales attempts failed, Crain’s said. After selling only three units in early 2008, the developer took the remaining six units off the market for a year during the recession. Last year, Cardinal Investments appeared to be illegally renting out the unsold condos in the building. The Bank of Smithtown filed a foreclosure action on the property, whose debt was valued at nearly $9 million. Sources told Crain’s that the auction was a way to help the firm work out its problems with the bank while avoiding lengthy litigation. The auction, the first of its kind in Manhattan, will be conducted by Paramount Realty at the Roosevelt Hotel in Midtown.[Crain's]

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127 Madison Avenue

Reflecting signs of a turbulent market, property fund Cardinal Real Estate Investments will hold a one-day auction in June for the six remaining units in its nine-apartment building at 127 Madison Avenue, called M127, the New York Times reported. “There’s going to be some discount for this transpiring in an auction format,” said Kyle Ransford, a founder of Cardinal Investments. “But the upside for us is that it happens quickly.” Open houses will be held starting Memorial Day. On June 27, the rest of the apartments will be auctioned off at the Roosevelt Hotel, in an event organized by Paramount Realty USA. There is no minimum bid for the two-bedroom units, some of which have been listed for as much as $1.9 million, but there is a “suggested opening bid” of $599,000. In February of last year, The Real Deal reported that Cardinal Investments had been renting out unsold apartments in the M127, and in one of its other buildings on the Lower East Side. [NYT]

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From left to right: Kent Swig, Yair Levy, Harry Macklowe and Aby Rosen could be personally liable to lenders.

From the November issue: Contrary to popular belief, commercial lenders did not throw out all of their standards in the recent cycle of easy credit.
When developer Aby Rosen structured his $133 million loan for the
acquisition and development of the Shangri-La hotel at 614 Lexington
Avenue in April 2007, the mortgage document included a personal
guaranty to cover losses in the event of a default. Similarly, when Kent Swig negotiated $49 million in loans with
Lehman Brothers Holdings to develop a hotel and condo project at 45
Broad Street in the Financial District in 2006 and 2007, the bank
demanded a similar guaranty in the mortgage documents.
And other big-time borrowers such as developer Yair Levy and
investor Steven Elghanayan have made the same types of commitments to
convince banks to make loans on their projects. [more]