Lev Leviev (left) and the former New York Times Building

A private equity firm that helped fund the $525 million purchase by Lev
Leviev’s AFI USA of the former New York Times Building in 2007 is
accusing the buyer of scheming to wipe out the lender’s $79 million
mezzanine position. The mezzanine lender, Stamford-based Five Mile Capital Partners,
charged in a 30-page breach of contract lawsuit that AI Holdings (USA),
a subsidiary of AFI USA, is overstating a loss in value of the building
to trigger a technical default that would permit the senior lender,
Banco Inbursa of Mexico, to foreclose on the property. The property value was marked down from $690 million following the
purchase to $315 million as of December 2008, the filing says, creating
the event of default.  More

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SL Green Chairman Stephen Green (left) and NYU’s Barry Hersh

The city’s largest office building landlord SL Green Realty is holding firm on 50 percent
renewal commissions in office leases despite a downturn in the economy
and competition from other large property owners who are paying full
commissions. The real estate investment trust headquartered in Midtown pays a 50
percent commission on renewals, a consistent fee the company has paid
for a decade, the company said in a statement released to The Real Deal. “We welcome the participation of brokers and have had a consistent
decade-long policy during both strong and weak market conditions to pay
a one-half commission on renewal transactions,” the statement said. Several leasing brokers said they were chafing under the policy. [more]

 Left to right: Robert Knakal, Patrick Hanlon, Barry Hersh

Brokerage and financial advisory firms are studying the recently
released federal Public-Private Investment Plan to see how they can
profit from the complex program. The two-part plan provides loan
guarantees for the purchase of troubled loans under the Legacy Loan
Program and securities under the Legacy Securities Program, including
those written on commercial real estate. The Legacy Securities Program
would tap into funds created through the Term Asset-Backed Securities
Loan Facility, known as TALF. The government hopes that credit will
free up as bad debt is removed from bank balance sheets. Experts say
that because the plan is still under development it is difficult to provide
specific examples to New York City, but The Real Deal spoke to three real estate pros to get their take on the local commercial real estate implications. [This is the first in a two-part series on how the federal loan guarantee plan affects New York City real estate. The second part will be on the residential market.] [more]