Howard Michaels in his office at 560 Lexington Avenue last month.From the October issue: Thirty-four years ago, Howard Michaels was knocking on doors in the 2.3 million-square-foot Starrett-Lehigh office building, hawking copy machines for the 3M Company.

“I was making bupkis,” Michaels recalled.

Those days are undoubtedly over. In 2004, he arranged a $219 million recapitalization of that same building, earning a seven-figure commission for his company, a real estate investment advisory firm known as the Carlton Group.

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A Morgan Stanley portfolio of eight high-end CNL Hotels & Resorts properties has been seized by a group of lenders in a $600 million debt restructuring deal, sources told Bloomberg News. The lenders, New York-based hedge fund Paulson & Co., Winthrop Realty Trust and Capital Trust, had originally ponied up $1.5 billion in senior debt, $1 billion in mezzanine debt and another $800 million in corporate debt to help finance Morgan Stanley’s $6.7 billion acquisition of the resorts in 2007. But Morgan Stanley has since been struggling with the health of boom-time real estate acquisitions, having racked up $4.4 billion in such losses in 2008 and 2009. [more]

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]

Tishman Speyer and BlackRock have 10 days to make a payment on their troubled Stuyvesant Town and Cooper Village complex before lenders step in to foreclose, sources told Bloomberg. The owners missed a $16.1 million payment on the property last week, putting them in technical default, and as a result, a group of senior mezzanine debt holders, led by Winthrop Realty Trust, said in a letter that it would pursue “rights and remedies,” including a possible foreclosure sale. The group holds $300 million in debt on the property and could act within 90 to 180 days. Tishman Speyer and BlackRock Realty purchased Stuyvesant Town, the city’s largest apartment complex with 11,200 units, for $5.4 billion in 2006, investing $112.5 million each. It was valued at just $1.8 billion in October. The $3 billion mortgage from Wachovia Bank was packaged and sold as securities to several investors including Fannie Mae, Freddie Mac and the Government of Singapore Investment Corporation, which has already reported losses in the aftermath of last week’s default. [Bloomberg]