One Madison Park

Judge Kevin Gross, in an opinion released yesterday, said the case involving the luxury tower at 23 East 22nd Street, is placing an untold burden on his courtroom and cited an inability and unwillingness of the various parties to resolve several key disputes in the bankruptcy. The decision forces part of the case to start from scratch in New York state court after 1.5 years in bankruptcy court in Delaware.

“These adversary proceedings are extremely contentious and there is minimal cooperation among the parties,” Gross wrote in his opinion. “It’s fair to say the parties won’t agree on what day it is.” [more]

Related has purchased a portion of restaurateur Danny Meyer’s Union Square Events, Business Week reported. The pair will partner on future ventures, the first being Related’s Hudson Yards.

Meyer, of Shake Shack fame, sees it as an opportunity to extend his brand to stadiums and other properties that his products don’t currently reach, and Related gets the cachet that Meyer’s popular chains bring. [more]

Snowmass Village, Colo.

Related Cos. is facing a $32 million fraud lawsuit from German lender Hypo Real Estate, stemming from the collapse of a multi-million dollar ski resort in Snowmass Village, Colo.

According to the suit, filed last Wednesday in New York state Supreme Court, Hypo led a syndicate of banks on a $520 million loan to finance the Base Village project at Snowmass Village. Part of the financing included $32.55 million in municipal bonds. [more]

From left: One Madison Park, Stephen Ross of Related and Ziel Feldman of HFZ Capital Group

Related and HFZ Capital Group cleared a key hurdle in their effort to take over the beleaguered One Madison Park condominium tower on Thursday, after the deadline for parties to file competing bids passed with no additional offers.

Related, through an entity known as One Madison FM, had initially been HFZ’s rival to become the sponsor of the 50-story tower at 23 East 22nd Street, which creditors pushed into bankruptcy in June 2010. But in September, Related and HFZ joined forces to bid for control of the property through a bankruptcy auction, which had been scheduled for Dec. 13.

The lack of competing bids allows the entity that controls One Madison, FKF Madison Group Owner LLC, to move ahead with Related and HFZ’s proposal to pull the 69-unit property out of bankruptcy. [more]

From left: Mary Ann Tighe of CBRE, Jimmy Kuhn of Newmark and 3 Columbus CircleAdvertising behemoth the Young & Rubicam Group will move into 340,000 square feet at SL Green’s 3 Columbus Circle, in a commercial condominium purchase and lease, the New York Times reported. The move marks the last major advertising agency to defect from Madison Avenue, the street that is synonymous with the industry as a whole.

Young & Rubicam took a condo interest in 214,372 square feet on floors three through eight, and signed a 20-year lease for 124,760 square feet on floors 9, 10, 18 and 19 at the 26-story tower. Three Columbus Circle, also known as 1775 Broadway, occupies the entire block between Eighth Avenue and Broadway at 59th Street. The deal includes naming rights for the building.
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The Related Companies has secured a $200 million construction loan for a 30-story apartment house on a lot on West 30th Street and 10th Avenue it’s developing with partner Abington Properties, Crain’s reported. The loan is slated to close in early 2012.

The 400-unit property, located close to Related’s Hudson Yards project, will be constructed under New York State’s 80/20 program. It was not immediately clear when the building would be completed, though sources said it would most likely be before the Coach building at Hudson Yards opens in 2015. [more]

Real estate developers, brokers and attorneys are gathered for the third annual Massey Knakal Multi-family Summit for the tri-state area at the McGraw-Hill Conference Center on Sixth Avenue. The focus of this year’s summit is the acquisition, disposition, financing and management of multi-family properties in the greater New York City area, with a special emphasis on the political environment, trends in rents and operations, as well as a discussion of cap rates, financing and interest rates.

Bruce Beal, executive vice president of the Related Companies, talked about about the rental market and Related’s current projects.

“We’ve been doing everything from looking at distressed opportunities — projects that failed, retail projects that weren’t leased, half built condominium buildings — mostly in our core markets like New York, Boston, California,” he said. — Katherine Clarke [more]

From left: FHFA Inspector General Steve Linick and Related Companies Chairman Stephen Ross

The Related Companies has been served with a subpoena as part of a federal inspector general’s investigation of a transaction the company did with Fannie Mae that allowed Related to invest a stake in several apartment buildings that had been foreclosed upon by Fannie, according to the Wall Street Journal. Related retained Kenneth Breen, a New York-based litigator at international law firm Paul Hastings, in the case.

As previously reported, the inspector general began a limited investigation into Fannie Mae in October; the agency responded by putting employees on leave until the investigation is completed.

“The investigation is limited in scope and we are cooperating fully,” a Fannie spokesperson commented.
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Fannie Mae staffers have taken leave as the Federal Housing Finance Agency’s inspector investigates an agency transaction believed to involve the Related Companies. The Wall Street Journal reported that the FHFA Office of the Inspector General began a limited investigation into Fannie Mae last Thursday, and that the agency responded by putting employees on leave until the investigation closes. [more]

Stephen Ross, chairman of the Related Companies, and Ruppert playground

The Related Companies is bringing a state-of-the-art cancer treatment center to its Upper East Side development site occupied by a beloved park, the Wall Street Journal reported.

The site, at 205 East 92nd Street between Second and Third Avenues, is currently home to Ruppert Playground, which Related took over in 1983 from the city and agreed to preserve for 25 years. Now that the period has expired and Related is moving forward to develop the site, neighbors are rallying to save the public space (note: correction appended). While Related is in the process of trying to find a suitable compromise with residents of the neighborhood, the firm has exceeded its legal obligation to the playground and can begin development without interference. [more]