1 Park Avenue and, from top, Scott Rechler of RXR and Norman Sturner of Murray Hill Properties (building photo source: PropertyShark)

Vornado Realty Trust spent a total of $180 million to recapitalize and gain control of the 925,000-square-foot office building 1 Park Avenue from Norman Sturner’s Murray Hill Properties, which was in danger of losing the property to lenders.

The cash infusion included about $30 million in tenant improvement costs and other reserves, while at the same time Vornado secured $250 million in debt from a major investment bank, a person familiar with the deal, which closed last night, said. Murray Hill retained a small portion of the equity on the 20-story building located between 32nd and 33rd streets, the source said.

The original capital stack was comprised of a $375 million first mortgage, $100 million in mezzanine debt held by three companies and $120 million in equity. [more]

1180 Sixth Avenue and Norman Sturner, president of Murray Hill PropertiesShorenstein Properties is foreclosing on its mezzanine debt at 1180 Sixth Avenue after owners Murray Hill Properties and the Carlyle Group defaulted on their mortgage payments last month, Crain’s reported. The joint venture purchased the 23-story property, between 46th and 47th streets, for $300 million in 2007, but ran into financial trouble there after the market crashed. As a result, Murray Hill Properties had recently hired the Carlton Group to help it hold onto the 400,000-square-foot tower, with chairman Howard Michaels reportedly hunting for another $245 million. [more]

1180 Sixth Avenue and Norman Sturner, president of Murray Hill PropertiesMurray Hill Properties has defaulted on its loan at 1180 Sixth Avenue and has tapped real estate investment bank the Carlton Group to help save its investment, sources told Crain’s, though Norman Sturner, president of Murray Hill, denied the reports. The mezzanine debt on the 400,000-square-foot property is currently owned by Shorenstein Properties, who has told real estate executives it may foreclose. Sources say that Carlton’s chairman, Howard Michaels, is looking for about $245 million. Murray Hill purchased the 23-story tower, between 46th and 47th streets, in 2007 for $300 million, public records show. [more]

Ofer YardeniFrom the December issue: At times, this city can seem like an ocean of distress without a drop to drink. Half-built or unsold condos abound. Office buildings dot marginal neighborhoods offering low rents to stay full. Loans secured by real estate are in trouble all over. Yet all this distressed commercial inventory can be elusive, kept off-limits by banks waiting for a full recovery and perhaps mindful that in the last downturn, in the early 1990s, they may have let go of valuable real estate too soon. Nonetheless, some are figuring out how to wrest control of these troubled properties, and this month The Real Deal compiled a scorecard of the big private equity funds clearly leading the way. [more]

From left: Norman Sturner, 509 Fifth Avenue and 1412 Broadway

Murray Hill Properties co-founder Norman Sturner is busy in the buy-and-sell game, according to the New York Post. Sturner has paid $32 million for Joseph Moinian’s 509 Fifth Avenue between 42nd and 43rd streets and has also recently inked a deal to sell his 1412 Broadway building at 39th Street for $150 million. The buyer of the 84 percent-occupied 1412 Broadway, Norfolk, Va.-based Harbor Group, snapped up 4 New York Plaza in 2009, subsequently signing the New York Daily News and U.S. News & World Report as tenants. Sturner said he expects the deal with Harbor to close before the end of the year. [Post, 1st item]

[more]

Broker David Greene has been named the president of the brokerage division with commercial real estate services firm Murray Hill Properties, the company announced yesterday. The move comes after founding partner Neil Siderow assumed the role of chairman of the company a few months ago, according to a Murray Hill spokesperson. The role of chairman had not previously existed at the firm, which is planning to relocate to 277 Park Avenue near the corner of 48th Street later this month. TRD

[more]

Norman Sturner and 450 Lexington Avenue (building photo source: PropertyShark)

Over
the last six years, Murray Hill Properties has grown in prominence and
now runs $265 million worth of high net-worth real estate funds,
co-founder Norman Sturner
told the Observer. Sturner built his business in 1971 together with
Neil Sidrow, and they have bought and sold over 150 buildings in the
last 40 years. “If I ever had seller’s remorse, it was one property:
450 Lexington Avenue,” Sturner told the Observer. He also just
completed capitalization at 1412 Broadway and approved two leases
there, both in excess of $40 a foot. Sturner believes that persistence
plays a crucial role in success. “The ability to keep your focus on
what it is that you want is extremely important, and it doesn’t matter
whether you’re a broker, an investment sales owner, a property owner or
anyone,” he said.”If you think you’re right, do it. Don’t let go. Do
not go quietly into the night.” [NYO]

[more]

160 Lexington Avenue and Howard Kessler of Newmark Knight Frank

The building that once housed Touro College at 160 Lexington Avenue on the corner of 30th Street is up for sale or net lease, with Newmark Knight Frank marketing the listing. Also, the Manhattan DA announces an expanded economic crimes wing that will target issues like mortgage fraud. And, DEP renews its lease at 1250 Broadway. Click here for more. TRD
[more]

From the October issue: New York City is at a peculiar crossroads. For months, investors have
marshaled unprecedented amounts of capital, salivating at the prospect
of snapping up distressed properties. “We’re fortunate this cycle to
have the most dry powder in our
history,” Blackstone Group president Tony James said last month at the
Barclays Capital Global Financial Services Conference, which was held
in Manhattan. The firm has about $28 billion in unspent capital, he
said. About $12 billion of that is earmarked for real estate. “We’re
just beginning what will be the best period in decades for private
investing,” he said. Dan Fasulo, a managing director at Real Capital
Analytics, estimated
that $50 billion has been raised and is ready to be deployed into
distressed real estate. Paradoxically, investors have found very little
worth buying so far, in large part because banks continue to hold
troubled loans on their books, hoping conditions will improve. [more]

While commercial real estate experts predict a rise in distressed securitized loans for New York City over the next year, new data shows the number of assets added to the tally last month actually fell. The quantity of loans transferred to special servicers dropped sharply last month, and those placed on servicer watchlists declined slightly, new data provided by financial tracking firm Trepp to The Real Deal shows. Only three New York City loans were transferred to a special servicer in September, down from 13 the month before, the figures indicate. At the same time, the volume of assets placed on a servicer’s watchlist fell slightly to 40 from 50 the month before. [more]