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Like Father Like Son (In Law): Ivanka Trump's Husband About To Experience His First Real Estate Default

Tyler Durden's picture


Over two years ago, when discussing the absolutely top ticked purchase of one 666 Fifth Avenue by under-30 real estate mogul extraordinaire, NY Observer owner and now Donald Trump son in law, Jared Kushner, we said: "Looks like the commercial mortgage apocalypse is about to claim its next victim, this time in the form of the appropriately numbered 666 Fifth Avenue building, home to such previously flourishing tenants as Citi Private Wealth Management...the building's DSCR
has fallen to an abysmal 0.69. Even when taking into account
the $98 million (or much less) reserve fund the building has set aside
to cover rent shortfalls, one can assume it won't be long before the 666
insignia again prominently graces the roof, especially since it would
have to replace a laughable Citi sign." Ah, the good old days of 2009, when news mattered, data actually flowed through models, hedge funds traded on constant inside information, markets actually dipped, POMO was a clown, and central planning was merely a drop of unrecycled ink in Ben Shalom Mugabe's toner cartridge. But we digress. As usual Zero Hedge may have been just a little bit ahead of the curve, though still better late in our prediction than never. With little surprise we read in the WSJ, that after an artificial delay of over 2 years, the inevitable is about to catch up with reality, confirming that no amount of Vissarionovichian market manipulation can make up for the complete absence of cash flows. "As of March, the aluminum-panel-clad skyscraper was about $3.5 million-a-month short on debt
service, say people familiar with the matter. Only $10 million remained in a
reserve fund used to service the property's $1.22 billion mortgage, which is
tied to the office portion of the building. Its revenues are only one-fourth
the amount forecast in 2007." Next steps: technical and/or full blown default.

More from the WSJ, which describes what in a normal world would have happened lliterally years ago:

Mr. Kushner is now facing off against a set of lenders that include private-equity heavyweights Starwood Capital Group and Colony Capital LLC. Talks have accelerated recently, with Mr. Kushner offering to put in tens of millions of dollars to recapitalize the property in exchange for some form of relief, people familiar with discussions said.

The Kushner family appears to have significant financial resources, and lenders don't expect other backers, including Mr. Trump, to come to Mr. Kushner's aid.

"The Kushners are ready and willing to invest more money into the property as soon as they can come to mutually satisfactory terms with the servicing agent," a spokesman for Mr. Kushner said.

Talks are fluid, but several people familiar with the talks say that outlines of a deal could be agreed upon within weeks.

New to the New York office market, Mr. Kushner, then 26, took the lead in buying 666 Fifth Ave., at 52nd Street, from landlord Tishman Speyer. The price—paid for with $1.75 billion in debt and $50 million in equity and $100 million in reserves from the Kushner family and family business partner George Gellert—assumed that a string of below-market expiring office leases would be replaced with companies paying far higher prices, according to loan documents. They also planned to sell a stake in the retail portion of the building and paid off junior debt.

The retail sale turned out well. In 2008, Mr. Kushner sold a controlling 49% stake in the space in a deal that valued it at $525 million. Earlier this month, Spain-based Inditex Group agreed to buy a portion of that retail at a significantly higher price, valuing it at about $8,300 a foot. It used to house an NBA store and will soon house the clothing brand Uniqlo's flagship store.

Once projected to take in nearly $120 million in annual office rent, the 39-story building will post income of close to $30 million this year, down from $60.1 million in 2007, people familiar with the rents said.

But the higher office rents haven't materialized and vacancies have increased. If Mr. Kushner were to miss a payment after the fund is depleted, he would be in default and representatives of the lenders could eventually attempt to seize the building if a deal isn't worked out, people involved with the talks said.

The commentary from the future presidential candidate now is oddly comparable to that uttered by young Master Kushner back then. Compare: "He is a very smart young man," Mr. Trump said of Mr. Kushner in an interview Tuesday. "I think it will come out well for him and everybody" (as of March 29, 2011) with: "We are well capitalized and conservative and feel confident that we
will do well
with this over time.” Kushner said (as of January 15, 2009). At least one has been proven wrong. Of course, sooner or later, everyone else who bets on the fortuitous alignment of the stars (ahem Gideon Bernanke) will end up bankrupt. The only question is how much of other people's money will be used up in the process- the Kushner cash legacy is about to find out first hand. "The bulk of the mortgage, $929.5 million, was securitized and sold off to investors as bonds. Private-equity firms Starwood Capital, Colony Capital, Area Property Partners and Paramount Group each bought stakes of the remaining $285.5 million in debt at a roughly 30% discount over the past two years, according to people familiar with the deals. Loan special servicer LNR Property Corp. has been taking the lead for all debt holders in the talks." And all will demand a piece of the pie.

Then again, with Kushner investing virtually zero equity in the project (thank you idiot CMBS investors), we are fairly confident he will promptly walk away leaving Starwood et al fight over who gets to defect next.

This is especially true if the updated remittance report indicating that 666 Fifth is now a ghost town, is true, and where Izzy Englander's Millennium Partners may be the largest tenant left.


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Tue, 03/29/2011 - 22:04 | 1115309 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

On a long enough time line, the survival rate for everyone, including the Trumps, drops to zero.

Tue, 03/29/2011 - 22:03 | 1115335 Howard_Beale
Howard_Beale's picture

Well yeah that, and every girl wants to marry the image of their daddy. Looks like she was spot on.

Tue, 03/29/2011 - 22:33 | 1115439 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Hmmm...good point.  Really says something about Dick Cheney then, doesn't it?

Tue, 03/29/2011 - 22:46 | 1115506 willien1derland
willien1derland's picture eyes!!!! Where is my Xanax?!!!

Tue, 03/29/2011 - 23:26 | 1115634 Howard_Beale
Howard_Beale's picture


Wed, 03/30/2011 - 01:27 | 1115997 Michael
Michael's picture

I see a shit load of financial services sector workers sweeping streets in NYC before the complete and total economic collapse is said and done.

Wed, 03/30/2011 - 08:38 | 1116406 bonddude
bonddude's picture

Jet flies into building in 3...2...1...

"luckily the building was just insured..."

Tue, 03/29/2011 - 22:19 | 1115388 Popo
Popo's picture

... unless of course he gets a bailout.

Tue, 03/29/2011 - 22:26 | 1115415 jeff montanye
jeff montanye's picture

speaking of survival rates, the vissarionovich reference above has an interesting irony.  it's the middle name of a minor russian/finnish official and of his executioner, stalin.

Tue, 03/29/2011 - 22:56 | 1115545 Hedge Jobs
Hedge Jobs's picture

with these credentials he will either get a bailout or access to the discount window:

"Jared graduated from the Frisch School, a private, yeshiva high school. He graduated from Harvard University in 2003. Prior to his admission, his father had donated $2.5 million to the university, in what The Boston Globe claimed was an "egregious example of pay-for-Crimson."[2] In 2007, Kushner graduated from the New York University Stern School of Business and the New York University School of Law where he earned both JD and MBA degrees. Prior to admission, the family donated money to create NYU's Seryl Kushner Deanship, named after his mother.[4]

Kushner married Ivanka Trump, daughter of Donald Trump, on 25 October 2009. Kushner is an observant Jew"

Tue, 03/29/2011 - 23:27 | 1115646 YouBetYourLife
YouBetYourLife's picture

Haaaavard and NYU.  Success assured, right? 

Then he entered the real world, stepped off the curb without knowing enough to look both ways, and got hit by a bus.

Sadly, it happens all the time.

Maybe the family can donate money to build a new wing on the US bankruptcy court for the Southern District.

Wed, 03/30/2011 - 01:02 | 1115957 Yancey Ward
Yancey Ward's picture

Maybe the family can donate money to build a new wing on the US bankruptcy court for the Southern District.



Wed, 03/30/2011 - 08:12 | 1116345 cbaba
cbaba's picture

I think he is successful, his aim was to screw the investors and he did a good job for that.

That's all he learned in ivy league.

Wed, 03/30/2011 - 08:39 | 1116408 bonddude
bonddude's picture

The guy selling dirty waters and pretzels on the corner knows more about business.

Tue, 03/29/2011 - 22:05 | 1115311 FOC 1183
FOC 1183's picture

Met the Donald a few times on bond selling road shows back in the nineties. Pure ass. How many chapter 11s does a feline get, anyway?

Tue, 03/29/2011 - 22:06 | 1115341 Howard_Beale
Howard_Beale's picture

That is a terrible insult to felines of all sizes. The Donald is closer to the lizard variety although fishface was a name for him for many years.

Tue, 03/29/2011 - 22:52 | 1115519 Dr. Porkchop
Dr. Porkchop's picture

He did invent the comb-forward. Not only is he the president, but also a client.

Wed, 03/30/2011 - 08:07 | 1116332 Harlequin001
Harlequin001's picture

I can't see what women see in him to be honest...

Wed, 03/30/2011 - 08:13 | 1116350 cbaba
cbaba's picture

they see only "$"

Tue, 03/29/2011 - 23:48 | 1115742 LowProfile
LowProfile's picture

The lizard lobby is forming a picket line outside your door as I write.

Wed, 03/30/2011 - 00:01 | 1115782 Yen Cross
Yen Cross's picture

Low pro. Hope all is well. I'm still over seas. I like 7777. I owe you an appology. Thanks.

Tue, 03/29/2011 - 22:10 | 1115353 MarketTruth
MarketTruth's picture

Agreed, the guy is scum!

"He is a very smart young man," Mr. Trump said of Mr. Kushner in an interview Tuesday. "I think it will come out well for him and everybody"

Trump meet Jim "con man & manipulator" Cramer, Cramer meet "all glASS, no juice" Trump.

Tue, 03/29/2011 - 22:14 | 1115369 FOC 1183
FOC 1183's picture

My God, what a lethal combo. And 2012 running ticket? Shiver me timbers.

Tue, 03/29/2011 - 22:50 | 1115514 willien1derland
willien1derland's picture

Though I am certain Cramer has dreamed of having that sweet Trump hairstyle -

Tue, 03/29/2011 - 22:27 | 1115411 mynhair
mynhair's picture

Quit dissing felines, you mofo!

Trump's a bump in the ass of politics.  Looks like herpes.....not that I'd know.

Wed, 03/30/2011 - 05:23 | 1116192 Chumbadumba
Chumbadumba's picture

The pimples that never really go away, kind of itchy and always leave a mark? SOUNDS LIKE WHAT MY DADDY GAVE TO MY MOMMY!


Wed, 03/30/2011 - 00:41 | 1115904 wisefool
wisefool's picture

Well he is probably on his first. He claims he has never smoked a cigarette, drank alchohol or taken a sip of caffine. And he has no responsibility to those who did so after he ch. 7, and 13'nd on them. He made his billions honestly. 

Tue, 03/29/2011 - 22:00 | 1115312 Id fight Gandhi
Id fight Gandhi's picture

Wont Donald drop his money bags on this and help out?

Wed, 03/30/2011 - 09:10 | 1116493 SteveNYC
SteveNYC's picture

I would vouch that Donald has very limited liquidity.

Tue, 03/29/2011 - 22:03 | 1115323 Monkey Craig
Monkey Craig's picture

Interesting that LNR is servicing this loan.

I wonder if there is a personal guarantee from Kushner? Plus, I bet tenants are negotiating for lower rents.

Tue, 03/29/2011 - 22:04 | 1115337 Seasmoke
Seasmoke's picture

Trump has to let Jose Canseco or Richard Hatch or Star Jones help this kid out

Tue, 03/29/2011 - 22:06 | 1115338 Oh regional Indian
Oh regional Indian's picture

Somethign totally weird about the Don "Comb Over" Trump and his RE "suckess".

He's been funded by someone with bottom-less pockets for good reason.

Perhaps the fall guy for the birther controversy? Trump as Obama's bette noir? Who would have thought?

666, it must be devil's own bottomless, infinite printing press, eh?


Tue, 03/29/2011 - 22:13 | 1115375 alien-IQ
alien-IQ's picture

beneath that comb-over lays the missing frames of the Zapruder film. If he is not kept in a steady flow of USD's by TPTB...he'll let the wind do it's thing and expose the true killers. And nobody wants that...

Tue, 03/29/2011 - 22:28 | 1115419 Ted Celeste
Ted Celeste's picture

+666.  I love ORI but that comment needed a response like this.

Isn't it possible that Donald Trump is just a batshit-crazy, megalomaniac shyster who just accidentally happens to bring up a very relevant issue - the birth certificate?

Trump is a real person after all, asking real questions re: Obama.


Tue, 03/29/2011 - 22:51 | 1115516 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

A duchebag calling a duchebag a duchebag does not mean a douchebag is anything other than a duchebag.

Tue, 03/29/2011 - 23:12 | 1115584 Ted Celeste
Ted Celeste's picture

Well I say Trump is a value-add, as he asks a key question: where is the birth certificate?

(That said, he is a stupid asshole.  True 'dat.)

First Alex Jones talking about the Fed and now Don Trump talking about the birth certificate - looks like The View is becoming must-see-TV!


Tue, 03/29/2011 - 22:38 | 1115458 Oh regional Indian
Oh regional Indian's picture

hah. The things I've read about that whole fiasco. Funny reference.


Tue, 03/29/2011 - 22:08 | 1115350 alien-IQ
alien-IQ's picture

The family that BK's together stays together...or something like that.

Tue, 03/29/2011 - 22:31 | 1115424 Judge Judy Scheinlok
Judge Judy Scheinlok's picture

This family is a piece of work. Did Kushner's dad get out of jail yet? What about the Rabbi? Didn't he get convicted in Feb, 2011?

Throw them all in fucking jail!

Tue, 03/29/2011 - 22:37 | 1115459 bobboberson
bobboberson's picture

Execute them

Tue, 03/29/2011 - 22:46 | 1115495 Judge Judy Scheinlok
Judge Judy Scheinlok's picture

Fukashize every last one of them. If you default, you get to work on the entombment crew.

Tue, 03/29/2011 - 22:08 | 1115351 palmereldritch
palmereldritch's picture

You're sired!

Tue, 03/29/2011 - 22:11 | 1115366 Rahm
Rahm's picture


Wed, 03/30/2011 - 09:18 | 1116512 SteveNYC
SteveNYC's picture

Comment of the day.

+666 + Trump BK

Tue, 03/29/2011 - 22:11 | 1115357 Blano
Blano's picture

Just turn in the keys like Morgan Stanley did.  Problem solved.

Tue, 03/29/2011 - 22:11 | 1115359 Deluxe186
Deluxe186's picture

Tyler put up Rosie's latest interview

Tue, 03/29/2011 - 22:15 | 1115376 Yen Cross
Yen Cross's picture

It seems so Anne Hathaway esc... Is the Vatican involved?

Tue, 03/29/2011 - 22:15 | 1115378 jkruffin
jkruffin's picture

I guess Donald got the all-in 250% leverage memo for QE3 and he can't bail them out right now.  LOL

Tue, 03/29/2011 - 22:17 | 1115384 SqueekyFromm
SqueekyFromm's picture

Well, if Kushner has a sense of humor, he will lease some of the spots out at a low rate to very litigious law firms, public charities, ACORN, and several homeless individuals, who each would lose little by either litigation or Chapter 11.

Plus, Donald Trump is right about the Birther stuff, it is just that he isn't parsing his words very well. What he is really asking is for the same thing as Chris Matthews, which is, for Obama to cough up a long form. like I have long said, the REAL Birther question isn't WHERE Obama was born but WHY Obama won't cough up a Long Form and resolve the controversy.

If you ask WHY, then it becomes a lot more interesting controversy.

Squeeky Fromm, Girl Reporter

Tue, 03/29/2011 - 22:24 | 1115401 Yen Cross
Yen Cross's picture

You little vote scammer. I say he puts up tent cities on his so called (llc.-llp.) 5% at best golf courses. Put your name where your mouth is. If you can afford to?

Tue, 03/29/2011 - 22:38 | 1115465 SqueekyFromm
SqueekyFromm's picture

I'm not one to go around stirring up trouble.

Tee Hee! Tee Hee!

Squeeky Fromm, Girl Reporter

Tue, 03/29/2011 - 22:53 | 1115525 willien1derland
willien1derland's picture

Genius Squeaky - then Kushner could move in & apply for HAMP - Would love to be a fly on the wall during that discussion - great post

Tue, 03/29/2011 - 23:42 | 1115702 Yen Cross
Yen Cross's picture

Don't put her down. I like her thoughts. I'll go ECON acronym on your ass bitch! And then I'll take take your Wise ass and teach you the story of KAMPO bitch. Respect women. OUT

Tue, 03/29/2011 - 23:48 | 1115738 SqueekyFromm
SqueekyFromm's picture

Thank you!!! If Kushner does it now, while there are vacancies, he could keep a straight face in front of a judge. If the tenant took Chapter 11, the value of the lease could be confirmed in a plan because the occupancy rate is soooo low. I think the repo'ers would have a hard time getting relief from stay.

Oh, I am sure that new tenants, post Kushner, would just love to move in next door to the Harry Krishna Musical Theory Institute, or the Homeless Advocacy Council. Or the Kleptomaniacs Anonymous Group Therapy Meeting Hall.

But like I said, I'm not one to go around stirring up trouble.

Squeeky Fromm, Girl Reporter

Tue, 03/29/2011 - 23:15 | 1115600 Dr. Porkchop
Dr. Porkchop's picture

The reason WHY is because he doesn't have to give them the time of day. The issue is over. The birthers are wasting time chasing their tails. Nothing will ever come of it.

Tue, 03/29/2011 - 23:40 | 1115698 YouBetYourLife
YouBetYourLife's picture

Rumor has it that Gaddafi sent his agents to Kenya to find credible evidence that Obama was born there. 

If found, Gaddafi could play the ultimate extortion card.

"Hey, brother  Barry - are you sure I should be forced to leave Libya?  You sure?" 

Wed, 03/30/2011 - 00:10 | 1115709 SqueekyFromm
SqueekyFromm's picture

Oh, people keep saying that, but the numbers of people who have some degree of doubt where Obama was born just keeps going up. Last I looked, about 58% of Americans had some degree of doubt. I think it is a lot more interesting WHY Obama persists in allowing a very simple question to go on unresolved when there are these large numbers of people who have uncertainty. If it is a political gambit on his part, then it didn't work out for him, and there should be some real curiousity why he persists. Particularly when he just got SHELLACKED in the midterms. Maybe he's a masochist???

Squeeky Fromm, Girl Reporter

Tue, 03/29/2011 - 22:18 | 1115387 rosiescenario
rosiescenario's picture

If we could quarantine NYC and D.C. from the rest of the U.S. we might have a chance....

Tue, 03/29/2011 - 22:32 | 1115427 random shots
random shots's picture

We would just find some other way to fuck it up.

Tue, 03/29/2011 - 22:36 | 1115447 jkruffin
jkruffin's picture

Yep, like naming Detroit or Miami the new Capital.  LOL

Tue, 03/29/2011 - 23:07 | 1115574 alien-IQ
alien-IQ's picture

The nice thing about Miami is that it's so close to the United States.

Tue, 03/29/2011 - 22:23 | 1115398 RobotTrader
RobotTrader's picture


The joke will be on the lenders.

This kid will walk away and move on to the next deal, just like all the others.

In fact, in NYC, the bigger the default and/or bust, the more desireable you are to future lenders.

"Oh, he already made a huge mistake.  He learned his lesson, and won't do it again."

Some other PigMen Country Club Clique will pick up 666 for a tidy discount off the loan amount, refurbish and release it, and make millions.

Most likely buyer will be one of the publicly-traded REITS, which as of this moment, are still pinned at or near 52-week highs.

Life will go on.

The kid will continue to do deals and one day he'll hit a home run, become fabulously wealthy, divorce Ivanka when she starts to get some wrinkles, and re-marry somebody 20 years younger.

Meanwhile, the trophy properties will underperform, then overperform, then underperform, and the title will change hands at least 10 times in the next 20 years, passed on from one REIT or private equity firm or another.

Nothing will change, ever.

Tue, 03/29/2011 - 22:39 | 1115470 Spalding_Smailes
Spalding_Smailes's picture

Got YOKU ..... Lol'

Tue, 03/29/2011 - 22:42 | 1115473 alien-IQ
alien-IQ's picture

gee that a touch of "scmammer envy" I detect in your post?

Tue, 03/29/2011 - 22:42 | 1115474 The Axe
The Axe's picture

all true..sad but true

Tue, 03/29/2011 - 22:54 | 1115539 Hulk
Hulk's picture


Wed, 03/30/2011 - 13:31 | 1117475 Harlequin001
Harlequin001's picture

Er she'd get it...


Tue, 03/29/2011 - 22:24 | 1115408 99er
Tue, 03/29/2011 - 22:28 | 1115423 whoopsing
whoopsing's picture

Like father - like son(in law). ...Bond (bag) holder's..."Yes,yes,it's all right here in this bag,all unicorn's and....Snif,snif...What's that smell?"

Tue, 03/29/2011 - 22:33 | 1115433 mynhair
mynhair's picture

Fuck Trump, and the horse he rode in on.

Bachmann 2012

What, you want dufus for 4 more?

Tue, 03/29/2011 - 22:45 | 1115496 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Bachman?  Whaaa?  We can do better.  Let's get some dudes that could actually kick some ass in there.  Then instead of declaring wars, we could just have our Pres throw down with the bad guys in a cage match.  I mean, Barack would probably get his ass handed to him by Gaddafi.  But Bachman might be able to take Barack so at least there is that.

Ventura/Piper '12.

Tue, 03/29/2011 - 22:51 | 1115515 mynhair
mynhair's picture

Will research more, thanks.

Afraid Bachmann has realized the money to be raped, but better than what we have.

I trust no one.  Tanks, X-Files!

Tue, 03/29/2011 - 22:53 | 1115532 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Right.  Trust no one.  This is why I have not voted for awhile.  Who the hell could run this country?

Tue, 03/29/2011 - 23:05 | 1115572 mynhair
mynhair's picture

I could, but I can't afford the ad budget.  Plus, I have no idea on how to influence dead people.

Wed, 03/30/2011 - 00:08 | 1115810 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I don't know what to do about the money, but if we contact the Daleys, maybe they will teach us their tricks.

Wed, 03/30/2011 - 08:20 | 1116360 web bot
web bot's picture

Anyone who thinks Trump for President needs their head read. The only ones truly thinking Trump would do well are 20 somethings with excess testosterone.

In the real world, governments don't... and most companies don't operate the mirage that Trump sells on TV each week. When you hear someone say Trump for President, think Ahmadinejad for Iran... it's about the same #uckin effect.

Tue, 03/29/2011 - 22:33 | 1115440 max2205
max2205's picture

This a warning to to-be-defaulted: IPO now

Fed don't bailout private firms

Tue, 03/29/2011 - 22:36 | 1115443 pitz
pitz's picture

Lol, when will the RE freeloaders ever learn, that Real Estate is only as healthy as the tenants that are in it.  If the landlords bludgeon the tenants to death, they shouldn't expect high rent payments to materialize.

Tue, 03/29/2011 - 22:35 | 1115450 FreedomGuy
FreedomGuy's picture

He should have sold stock in it. Stocks only go up these days. Bad news makes them go up more. And bad news that's better than the worst news is actually better than good news...for stocks. Get Bernanke to securitize it with all the other MBS stuff he owns, now.



Tue, 03/29/2011 - 22:53 | 1115521 John McCloy
John McCloy's picture

Donal Trump is the epitome of extend and pretend. A self annointed nobody reliant upon his father's past wealth and savings who has done nothing but craft an image and spend millions building his brand equity as opposed with nothing of substance to back it. I will say his daughter has a head on her shoulders.

The Trump name is subprime

Wed, 03/30/2011 - 00:39 | 1115902 Milton Waddams
Milton Waddams's picture

In internet parlance Don would be considered a troll.

Tue, 03/29/2011 - 23:00 | 1115554 Nathan Muir
Nathan Muir's picture

Remember people - when you're a rich, savvy investor default is just smart business from time to time... but if you had the privilege of receiving a home mortgage it is your moral obligation it repay your debts.

Tue, 03/29/2011 - 23:13 | 1115591 PulauHantu29
PulauHantu29's picture

So what does this have to do with The Royal Wedding?

Tue, 03/29/2011 - 23:39 | 1115619 mynhair
mynhair's picture

OMG, if I were Prez.

Cancel prior executive orders allowing unionization.

Put forth an executive order disallowing  Soros groups to sue on behalf of whom?

so much more....

defund all departments....

increase NASA to a Mars mission....

restore hope, kill Libs....

$35 bounty on wolves, they be rare, $10 on Libs?

You bring in the skin...

Tue, 03/29/2011 - 23:24 | 1115633 steve from virginia
steve from virginia's picture


Tishman found a sucker in Kushner & Co. who put up a mere $50m for a $1.8b deal. How about that for leverage? 3%.

The lenders will get the building like they got Macklowe's buildings. It's all rot and self- delusion: the prices paid were all bubble prices. They still have a long way to fall. More lenders will get stuck with buildings they cannot sell or rent, the declines will feed on themselves.

666 is no trophy, just concrete and glass box across from Rock- Center. It was built in 1967 by Tishman and its original sale (to a Japanese company) was $50 million.

That's about what it is really worth, once all the 'glam' shopping tenant go bankrupt.



Wed, 03/30/2011 - 02:56 | 1116070 litoralkey
litoralkey's picture

I believe the original article by a Tyler is incorrect here.

666 retail space is now fully leased out.

666 just this week finalized a new $300M mortgage with JPMorgan.

This has them in for $201m for the remaining 60,000sqft

That 60,000sqft is not going to lease out for less than $59, and more likely $100sqft, leaving them with a solid profit and easily able to pay off the interest, the title free and clear in 15 years, and the Kushners will have turned a cobbled collection of slumlord apartment complexes in New Jersey into a $2B centerpiece tower in Manhattan in 2 generations.

At a minimum the Kushners and Carlyle will be able to carry the building for another 80 months.

The Kushner's top ticked on the sell side their multi-unit CRE empire, then used that cash to buy at top tick into 666,

everyone was stunned at the price they paid,

and then almost a year of speculation as it sat there slowly emptying out,

and then Kushners bagged a 20M/yr lease with Uniqlo in April,

Then more followed.


I love to hate the Kushners and Trumps as much as the next ZHer, even more so since they bought out the Politicker family of websites, but from what I've seen they will pull through the downturn and hold on through the (eventual) next upswing in NYC.


Tue, 03/29/2011 - 23:44 | 1115732 Yen Cross
Yen Cross's picture

If input is stupid, IT'S stupid. But I will not tolerate Men Or Women being played with by a bunch of thugs. Get Smart or beat it!

Wed, 03/30/2011 - 00:31 | 1115884 yipcarl
yipcarl's picture

She's not even hott.  Ew. 

Wed, 03/30/2011 - 03:03 | 1116097 litoralkey
litoralkey's picture

Just realized this is a 'leak' by someone at Barclays CRE group because Kushners and their partners went through JPMorgan instead of Barclays for the new mortgage.

Barclay's Manhattan CRE group got downsized last week on the sale of partial portfolio to CreXus.

Looks like someone at Barclay's is lashing out.

Petty, funny, don't believe the hype.


Wed, 03/30/2011 - 05:14 | 1116182 Bicycle Repairman
Bicycle Repairman's picture

Young Master Kushner and the private equity heavy-weights will probably compromise and have the taxpayer pick up the tab via the FED.  And why not?  No point in even casting aspersions on a promising real estate career.  If young men like this cannot step into their father-in-laws shoes, where will the future landlords of America come from?  Do you want utter chaos?

And when you come down to it, we all share the guilt for this young man's travails.

Wed, 03/30/2011 - 09:17 | 1116514 Zero Govt
Zero Govt's picture

Did Trump-in-Law pick 666 up at a 2007 discount?

...yet he's underwater with the debt repayments already, Ouch! Wouldn't wish this on anyone but the 2007 jumping-in looks like poor judgement/timing

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