Anglo Irish exec touts “extend and pretend” strategy for busted condos

Panel, from left: Eric Anderson of Tamarkin Anderson, Tom Nolan of the Radco Companies, Eric Anton of Eastern Consolidated, Garrett Thelander of Anglo Irish Bank, Avi Banyasz of Westbrook Partners and moderator Robert Knakal of Massey Knakal Realty Services (credit: Marc Becker)

After a couple of years of extending and pretending, Anglo Irish Bank is beginning to find that a healthier New York City real estate market was worth the wait.

“Extend and pretend… it’s actually been the right strategy,” Garrett Thelander, executive vice president of the embattled lender, told a crowd of investors, brokers and developers at GreenPearl’s Distressed Real Estate Summit yesterday.

Thelander, who spoke on a panel about busted condominium projects, explained that Anglo’s New York City investments have begun to rebound in value over the past six months as debt capital has grown cheaper and more available.

The bank, which was taken over by the Irish government in January 2009 to prevent its collapse amid billions of dollars in real estate-related losses, has been at the forefront of some of the city’s most high-profile troubled condos, including Yair Levy’s 225 Rector Place, which is scheduled for auction next month.

Anglo was also behind Maurice Mann and Lev Leviev’s record $426 million purchase of the legendary Upper West Side Apthorp building in 2007, which has since turned into one of the most fraught condo conversions in the city’s history, and the bank lent generously to the Alexico Group during the boom. Anglo has recently been unloading much of its distressed debt at Alexico-developed hotels like the Alex, Flatotel and the Mark.

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“Anglo is in a wind-down mode,” Thelander said. “We’re seeing improvement in the market and that’s giving us more reason to sell.”

But while distressed transaction volume may indeed be on an upswing, other panelists questioned the wisdom of some of the new investors.

“Sometimes failed projects are failed for a reason,” said Eric Anton, executive managing director at Eastern Consolidated. “Just because you’re buying cheap doesn’t mean you’re buying well.”

Panelists also included Tom Nolan of the Radco Companies, Eric Anderson of Tamarkin Anderson and Avi Banyasz of Westbrook Partners, with Robert Knakal of Massey Knakal Realty Services serving as moderator.

Nolan, a managing director at the Atlanta-based developer and workout firm, said he worries that overconfidence is bouncing back along with the market.

“People are becoming content and comfortable and they’re forgetting, in my opinion, that that’s how we got into [the real estate bust] in the first place,” Nolan said.