So asks the business info/analysis site Crain's New York. A new online article on Crain's has more on what's going on in New York, with foreclosures on properties providing opportunities for investment groups (including BlackRock!) to "swoop in" and gobble up these properties.
In Manhattan alone, there are 130 troubled properties worth $7.5 billion, according to Real Capital Analytics. With credit markets still frozen shut, many owners will be unable to refinance loans falling due and will have no choice but to default.
Eastdil Secured, for example, is currently marketing a $100 million debt position owned by insurer The Hartford that was used in 2006 to help finance the $5.4 billion purchase of Stuyvesant Town/Peter Cooper Village by Tishman Speyer and BlackRock. The owners had hoped to deregulate a substantial number of units in the sprawling rent-regulated complex and use the increased cash flow to pare down debt. That didn't happen, and the complex has been rapidly burning through rainy-day reserve funds. A default is possible as early as this fall, sources say.
Things may get very messy, however, because, as the article reasons, lawsuits are possible among a property's initial lenders. "Some lenders' positions will be completely wiped out in the event of a foreclosure," notes Crain's.
Somehow, I think, Stuyvesant Town and Peter Cooper Village will be saved from default, at least if papa Jerry Speyer can pull strings to help son Rob out of the embarrassment of such a downfall.