Adam Rose of Rose Associates and the Riverton Houses

Rose Associates is taking over leasing this week at Aire, the new 310-unit luxury rental building on the Upper West Side. The project is the latest in a string of new consulting and management roles for the 82-year-old family firm, which Crain’s reported is doing better than most during the downturn. “We don’t have a single bad loan, no workouts and no distractions,” said co-president Adam Rose. Rose’s property management arm grew by 24,000 units, or 30 percent, during last year alone. The company was recently brought in to manage Harlem’s 1,230-unit Riverton Houses and to consult on the transfer of Stuyvesant Town and Peter Cooper Village by special servicer CWCapital Asset Management. [more]

Property manager and developer Rose Associates has been named the exclusive managing agent for the Riverton Square apartment complex in Harlem, as The Real Deal first reported as a likelihood last month. The 1,230-unit complex, which is located between Fifth Avenue and the Harlem River and runs between 135th and 138th streets, is infamous for the rise and fall of its former landlord, Lawrence Gluck, who bought the property for $135 million in 2005 and refinanced it with a $225 million mortgage. The complex’s title was sold to special servicer CWCapital Asset Management at auction March 11 for $125 million. Jeffrey Heifetz, managing director with Rose Associates, said that cooperation with tenants will be of paramount importance to the company. “We are currently in the process of evaluating services at the property and identifying ways to enhance resident satisfaction,” Heifetz said in a written statement. “We look forward to maintaining a dialogue with residents and community leaders.” As manager, Rose will be responsible for the day-to-day management and upkeep at the 13-building, 12-acre complex. TRD

While it’s just taken over as special servicer at the Riverton Houses in Harlem, special servicer CWCapital may soon be under new ownership, according to Crain’s. Caisse de depot et placement du Quebec, a Canadian pension fund manager, is poised to sell its controlling shares in the company, which is also known for its role as servicer at Stuyvesant Town and Peter Cooper Village. The value of the interest is not immediately clear and CWCapital officials did not comment.

The Riverton Houses and Larry Gluck

The new owners of the rent-stabilized Riverton Houses in Harlem that sold at auction yesterday will have to pay a hefty transfer tax of just under $4 million after they take title to the property in the next couple of days, real estate experts said. Financial firm CWCapital Asset Management, the special servicer for the loan on the 1,228-unit complex between 135th and 138th streets and Fifth Avenue and Harlem River Drive, won the property at an auction yesterday with a bid of $125 million. Since it was representing the commercial mortgage trust that held the Riverton loan, it effectively put the foreclosed property back into the hands of the lender. Tom Fink, senior vice president of Trepp, which tracks mortgage-based securities, estimated the tax liability to be $3.8 million. [more]

Riverton Houses, Steven Sinatra (top) of Greenberg Traurig, and Howard Comet (bottom) of Weil, Gotshal & Manges

Update (1:50 p.m.): David Bistricer’s Morgan Capital was the other bidder. Comments regarding and from Bistricer added.

Special servicer CWCapital Asset Management won the bidding this
morning to take title to the Riverton Houses in Harlem at a price of
$125 million, following a short bidding war with an attorney
representing a company controlled by real estate investor David Bistricer, called Morgan Capital. About 75 people, including brokers, potential buyers and residents of
the 12 13-story apartment buildings, attended the brief auction in the rotunda of the State Supreme Court building at 60 Centre Street. The property has a loan with a judgment valued at $240.6 million that is held in a
commercial mortgaged-backed security. CWCapital is the special servicer
for the loan.
[more]

The W Hotel

The Moinian Group is negotiating with lenders after defaulting on a collateralized $25 million mezzanine loan last October, backed by the W New York Downtown Hotel & Residences, The Real Deal has learned.

Fitch yesterday downgraded a $942 million collateralized debt obligation issued by Realty Finance, a Rocky Hill, Conn.-based lender. Two of the three largest loans in the pool were backed by the W New York and the Riverton, a 1,230-unit multi-family complex in Harlem.

Moinian, led by developer Joseph Moinian, defaulted on the loan amid budget problems and construction delays, according to Fitch. Fitch said it “modeled a full loss on this highly-leveraged mezzanine loan,” however the ratings agency told The Real Deal that Moinian is currently negotiating with CW Capital Asset Management, the special servicer on the loan.

Moinian confirmed through a spokesperson that he is in talks with CW Capital and said he is continuing to make interest payments.

“No action has been taken against them and they are continuing to work with the special servicer to arrange new terms,” the spokesperson said in an e-mailed statement. [more]

The California Public Employees’ Retirement System, otherwise known as Calpers, is raising eyebrows for its investment in real estate developments across the country making the transition from rent-stabilization to market-rate, according to the Wall Street Journal. While Calpers took a major hit on its investment with the Stuyvesant Town and Peter Cooper Village apartment complex, experts say the organization, which handles approximately $200 billion in California state retiree funds, has profited off of numerous similar developments, like the Riverton Houses. Calpers, for its part, says it’s taking a critical eye to its investment trend. “These historical investments were made under previous investment leaders,” Brad Pacheco, a Calpers spokesperson, said. “Nevertheless, our current investment staff has the issue under study.”

The long-awaited $240.6 million foreclosure auction for the Riverton Houses complex in Harlem will be held March 11, according to an advertisement published this weekend in the New York Times. The auction will take place in the Rotunda of the State Supreme Court building at 60 Centre Street at 11 a.m., the notice said. A New York State Supreme Court judge ordered the complex to be sold at auction earlier this month, but the date was not given at the time. The amount of the judgment was set at $240.6 million, although a recent valuation for the property said it was worth just $108 million. Laurence Gluck bought the 12, 13-story buildings that lie between 135th and 138th streets and Fifth Avenue and Harlem River Drive, for $135 million in 2005, then refinanced the property with a $225 million mortgage. [more]

Harlem’s 63-year-old Riverton Houses will be sold in a public foreclosure auction, following orders from State Supreme Court Justice Richard Braun yesterday. The seven buildings, which lie between 135th and 138th streets, Fifth Avenue and the Harlem River, were purchased by developer Laurence Gluck for $135 million in 2005, at the height of the housing boom. He refinanced the property in 2006, recouping his own $44 million investment plus more with a new, $225 million mortgage and a $25 million loan. Gluck had then planned to make a profit on the 1,228-unit middle-class housing complex by converting most of its rent-stabilized apartments to market-rate rentals. He renovated the buildings and landscaped the property, but when, by 2008, only 10 percent of Riverton apartments had been deregulated, Gluck was left without enough rental income to cover debt payments. In 2009, he defaulted on the mortgage and offered to hand in the keys to Riverton in a deed in lieu of foreclosure. The property, recently appraised at just $108 million, has $240.6 million in debt. The foreclosure sale is expected to take place in March, and several groups have already expressed interest in buying Riverton, which is still managed by Gluck. [NYT]

Infamous landlord Larry Gluck is in hot water again. His
company, Stellar Management, which owns the Riverton Houses in Harlem,
faces imminent default a loan on a Silver Spring, Md. residential
development. The 890-unit Georgian Towers had just undergone a $35
million renovation when its $58 million loan went to a special
servicer. This spells bad news for Gluck, who recently refinanced
Riverton Houses with $225 million of mortgage debt, only to see the
complex later appraised at $52 million, putting it deep underwater.