Billionaire hedge funder William Ackman, who runs Pershing Square Capital Management, has added a $22 million Bridgehampton estate to his personal portfolio. According to the Post, the eight-bedroom beachfront home sits on six acres with a tennis court and views of Sagg Pond. The Corcoran Group’s Susan Breitenbach had been marketing the property for just under $26 million. But while Ackman may have scored a deal on the East End, his bet on bookseller Borders fell flat yesterday, when the company filed for bankruptcy. Pershing’s stake — it bought 5.1 million shares of the company in 2006 at between $18 and $20 per share — will likely be wiped out in the reorganization, Bloomberg News reported. [Post] and [Bloomberg]
Posts Tagged ‘pershing square capital management’
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It’s no wonder hedge fund bigwig Bill Ackman put up such a fight for control of Stuyvesant Town and Peter Cooper Village: he thought he could squeeze a “$2 billion potential profit opportunity” out of a co-op conversion at the massive complex, he told attendees of the Bloomberg Link Hedge Funds 2010 Conference yesterday. Ackman’s Pershing Square Capital Management and joint venture partner Winthrop Realty put $45 million into their purchase of $300 million worth of defaulted junior debt on the property earlier this year and had attempted to foreclose. [more]
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Stuyvesant Town and Peter Cooper Village
The first appraisal of Stuyvesant Town and Peter Cooper Village since the complex went into default in January is in, and investors won’t be happy with the result: $2.8 billion. Tishman Speyer and BlockRock bought the 11-acre property for $5.6 billion in 2006, using a $3 billion first mortgage and $1.6 billion in mezzanine debt. According to the Wall Street Journal, special servicer CW Capital, which took control of the complex last month after reaching a buyout deal for some $300 million in mezzanine debt from a group of junior lenders led by hedge funder Bill Ackman, is likely to cut down on interest payments to subordinate CMBS debt holders now that the property is worth less than the amount owed on the loan. Prior to the new valuation, CW had been directing advance interest payments to all of Stuyvesant Town’s many investors with the assumption that they would eventually be recovered. [WSJ]
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The Stuyvesant Town and Peter Cooper Village foreclosure auction, — already rescheduled, and then rescheduled again, for tomorrow — could be postponed for a third time, according to the Post. A source in on the buyout negotiations between special servicer CWCapital, which represents the senior mortgage holders on the 80-acre complex, and Bill Ackman’s Pershing Square Capital Management, which is leading the junior lenders, told the paper that the talks are going so slowly that CW is unlikely to meet its own deadline. Last week, when the auction was delayed for the second time, an attorney for CW told The Real Deal that the company just “wanted a few more days” but was still “committed to the detailed planning required to assure the most favorable resolution and smooth transition of this highly complex property.” It’s unclear how long the possible third delay might last. [Post]
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Junior creditors Pershing Square Capital Management and Winthrop Realty Trust lost their bid to stop the planned foreclosure sale of the Stuyvesant Town and Peter Cooper Village apartment complex, Crain’s reported. The New York State appeals court declined a request by Pershing and Winthrop to delay the Oct. 4 foreclosure planned by senior debt holders, according to court papers. William Ackman, who runs Pershing, said he will appeal. Pershing and Winthrop asked to stop the lender foreclosure last week. A lower court judge issued a preliminary injunction Sept. 16 blocking their foreclosure of the property unless they first pay senior creditors the $3.67 billion that they are owed under the first mortgage. CWCapital Asset Management, the special servicer for the senior mortgage, sued Pershing and Winthrop to stop their foreclosure plan, arguing that an agreement between the two groups of creditors prohibits Pershing and Winthrop from taking control of the property without paying the senior lenders. Pershing and Winthrop disagree and believe they have the right to foreclose on their collateral, which is separate from the lenders’ collateral. [Crain's]
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Pershing Square Capital Management and Winthrop Realty Trust filed a request today with a state appeals court in Manhattan to stop the Oct. 4 foreclosure planned by senior debt holders at the Stuyvesant Town and Peter Cooper Village residential complex, Edward Weisfelner, a lawyer for Pershing and Winthrop, told Bloomberg News. Pershing, a hedge fund run by William Ackman, and Winthrop, both junior debt holders, lost a bid last week to pursue their own foreclosure sale for the property. A lower court judge issued a preliminary injunction saying they may only proceed if they first pay senior creditors the $3.67 billion that they are owed under the first mortgage. If the court grants a stay, Pershing and Winthrop will still have to argue the merits of their appeal. Senior lenders will respond to the appeal Sept. 24 and the appeals court will decide by Sept. 29 whether to stay the planned foreclosure. Meanwhile, CW Capital Asset Management, the special servicer for the senior mortgage, is seeking to move forward with its foreclosure after Stuyvesant Town owner Tishman Speyer Properties defaulted on a $3 billion senior loan and $1.4 billion of junior debt. CW Capital’s foreclosure would wipe out the investment by junior lenders, according to the filing. [Bloomberg via Crain's]
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Bill Ackman of Pershing Square Capital Management
Pershing Square Capital Management and Winthrop Realty Services, the Stuyvesant Town and Peter Cooper Village junior debt holders whose attempt to gain control of the massive residential complex through foreclosure was stymied yesterday by a New York State Supreme Court judge, aren’t walking away without a fight. The joint venture officially announced plans last night to appeal the decision, which allowed the complex’s senior lenders to proceed with their planned foreclosure auction early next month. In a statement, the venture said it “strongly disagrees with the trial court’s ruling and will appeal the decision to the New York appellate court and will seek to stay the mortgage lender’s planned property foreclosure. If [Pershing Square and Winthrop are] unsuccessful on appeal, or if the mortgage lender is permitted to foreclosure prior to a successful appeal, the value of [the partners'] investment in the mezzanine loans may be lost.” Pershing Square has invested roughly $36 million in the loans, while Winthrop has put in around $10.5 million, the companies said. TRD
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Though Stuyvesant Town and Peter Cooper Village, the 80-acre apartment complex on the East Side, is facing foreclosure, the nearly 150 New York University graduate students who rent apartments there will likely not be affected, and NYU has no plans to purchase the properties, said John Beckman, a university spokesperson. “Currently, everything is status quo ante,” Beckman told NYU News. “Buying the apartments is not currently under consideration.” Winthrop Realty Trust and Pershing Square Capital Management have collaborated to purchase the complex for $45 million, calling for a co-op conversion of the property, which has garnered interest from several developers who want to bid on the project, most recently Gerald Guterman. But NYU students who live there are only minimally affected by the ongoing legal and financial struggles plaguing the complex. “As far as when I was living there, NYU basically told us to disregard all info about the situation,” said Andrew Cardenas, a student. “All our rent was paid directly to NYU and even super-related work requests were always made through NYU, never using the Stuy Town services.” [NYU News]
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Gerald Guterman, whose Condo Recovery firm bought more than 12,000 New York-area rental apartments and turned them into condos and co-ops in the 1970s and 1980s, is preparing a bid for a co-op conversion of Stuyvesant Town and Peter Cooper Village, Bloomberg News reported. Stuy Town has been embroiled in a dispute between creditors after owner Tishman Speyer Properties defaulted on a $3 billion mortgage in January. Guterman said he met with agents of the more than 25,000 tenants who live there and he has discussed the proposal with CW Capital Asset Management, the representative for the senior debt holders. Condo Recovery’s plan is dependent on CW Capital winning a lawsuit against junior lenders who are trying to seize control of the 80-acre complex. Bill Ackman’s Pershing Square Capital Management and Winthrop Realty Trust want to lead their own co-op conversion after buying $300 million of junior debt. [Bloomberg]
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A New York state Supreme Court judge postponed ruling today on whether a joint venture can foreclose on Stuyvesant Town and Peter Cooper Village. Judge Richard Lowe indicated he would likely rule later this month in the case over the 11,000-unit East Side complex, Crain’s reported. Over the summer, a joint venture between hedge fund manager Bill Ackman’s Pershing Square Capital Management and Winthrop Realty Services acquired a $300 million mezzanine loan for just $45 million, with plans to foreclose on the property in an auction Aug. 25. However, Bank of America and U.S. Bancorp, acting as trustees for the complex’s senior lenders, sued to block the foreclosure, alleging that the venture was breaching terms of the inter-creditor agreement, The senior lenders, who hold the $3 billion mortgage on the complex, also want to foreclose on the property. Earlier this year, a Tishman Speyer-led partnership defaulted on the mortgage. Since then, special servicer CW Capital, representing the interests of the senior lenders, has been working to ensure the property is maintained and preparing for an orderly foreclosure. [Crain's]
