Lenders give Apthorp one week extension on business plan

By David Jones | January 30, 2009 06:47PM

Anglo Irish Bank and Area Property Partners have extended the
deadline by one week for the new management team at the Apthorp
condominium to come up with a revised business plan, according to
sources familiar with the negotiations.

After settling a long
simmering legal dispute
, owners Lev Leviev and Maurice Mann were
scrambling to develop a new plan with the Broadwall Management Corp., a
unit of the Feil Organization, which replaced Mann as managing agent of
the building.

The plan, originally due at the end of January,
would lay out a schedule to rescue the Apthorp from foreclosure
proceedings. In December, Anglo Irish Bank, the senior lender on the
Apthorp mortgage, and Area Property Partners, a mezzanine lender known
as Apollo Real Estate Advisers until two weeks ago, threatened to
foreclose on the building unless Mann forked over about $23 million in
additional equity amid concerns that the building would not be able to
sell in the current market.

Mann refused and filed suit against
Apollo and Anglo Irish Bank for $500 million, leading to a protracted
legal fight with Lev Leviev, who partnered with Mann on the  $426
million acquisition of the building in 2007.

The Feil
Organization, an investor in the Apthorp, was brought in to replace
Mann as managing agent of the building earlier this month after Leviev
filed for an emergency injunction in New York State Supreme Court to
have him removed. Leviev, an Israeli diamond and real estate mogul,
argued that his agreement with Mann required that a rabinnical
arbitration court settle the dispute.

Sources familiar with the
talks say that the Apthorp, a 163-unit landmark building at 390 West
End Avenue, at 79th Street, will likely see significant price cuts if
it continues as a condominium. The owners originally planned to sell
the units for $3,000 a square foot.

Prices are already lower than the developers initial plan. Prudential
Douglas Elliman, the exclusive listing broker, is offering the units
starting at $3.4 million for a 1,750 square foot two-bedroom, which is
the equivalent of $1,943 a square foot. Sources say the Apthorp could
be converted back to a rental building, however a final decision has
not been determined.