Tishman Speyer and BlackRock's Interest Reserve on STPCV Could Deplete in Four Months

From Reuters:

NEW YORK, Aug 14 (Reuters) - The borrowed interest reserves that were part of the loans used to buy Manhattan's Peter Cooper Village and Stuyvesant Town apartment complexes could run out in four months, according to a Credit Suisse report.

The interest reserves on the property fell to $56.5 million at the end of July, down from the $400 million at the time of the underwriting, according to the report.

About $13.3 million of is was used in July, the analysts said in the report released on Thursday.

"If interest reserve drawdowns continue at this rate, there are about four months left until the reserve is depleted," analysts wrote in a research note.

Tishman Speyer and BlackRock Inc (BLK.N) purchased the 110 apartment buildings on 80 Manhattan acres from MetLife Inc (MET.N) in 2006 for $5.4 billion. They intended to boost revenue by converting rent-stabilized apartments into market rent apartments.

As of March 2009, 61 percent of the units were rent stabilized, unchanged from the end of 2008.

At the time of the purchase, the $3 billion senior mortgage loan was broken into parts and spread across different commercial mortgage-backed security (CMBS) trusts.

Tishman Speyer Properties is trying to appeal a recent New York State appellate court decision that could return certain recently deregulated apartments back to regulated status. (Reporting by Ilaina Jonas. Editing by Robert MacMillan)