Ackman to foreclose on Stuy Town for $45M

August 16, 2010 08:30AM

Stuyvesant Town

A new partnership led by hedge fund honcho William Ackman could buy the 110-building Stuyvesant Town and Peter Cooper Village complex in a foreclosure auction Aug. 25, paying as little as $45 million, real estate experts told Crain’s. Ackman announced last week that his hedge fund — Pershing Square Capital Management — had been tapped by Winthrop Realty Trust, one of Stuy Town’s creditors, to help it take control of the 80-acre, 11,220-unit complex. The partners paid $45 million –15 cents on the dollar — to scoop up a $300 million mezzanine loan, a key portion of the complex’s debt that stands between the owner’s equity and the first mortgage. Ackman also scheduled an auction for next Thursday, where he plans to foreclose on the property and take control of Stuy Town. If he succeeds, he intends to assume the complex’s nearly $4.5 billion in debts and begin a voluntary, noneviction co-op conversion on the rental property to generate cash to pay off its loans. [Crain’s]