First Commercial Fraudclosure Casualty? Stuy Town Foreclosure Auction Postponed
Has the foreclosure scandal taken its first commercial real estate casualty: tomorrow's foreclosure auction of bankrupt Stuyvesant Town (which will sell for less than half its cost) has been postponed, without any specific reason, leading some to believe that the residential title scandal may have spilled over into CMBS land. From Reuters: "A foreclosure auction of
Stuyvesant Town/Peter Cooper Village, the massive Manhattan
apartment complex that may be worth less than half what it was
just three years ago, was postponed on Tuesday for the second
time this month. CWCapital Asset Management, which represents the
bondholders who own the $3 billion mortgage on the property,
declined to say why the auction had been delayed until Oct. 22
from Oct. 13. It was originally scheduled for Oct. 4." To be sure, this is the second time the auction has been delayed so it may be completely unrelated to what is currently the main topic in the mainstream media, although god's propensity to play dice has been previously characterized best by one Albert Einstein.
More from Reuters:
Last week, CWCapital said it expected the bondholders would become the new owner until a final sale was arranged.
CWCapital is wrestling with a transfer tax of $100 million and holders of a junior loan owned by a joint venture between hedge fund Pershing Square Capital, headed by William Ackman, and Winthrop Realty Trust (FUR.N).
"Tenants are eager to see the legal dispute between CW Capital and Pershing Square-Winthrop wrapped up, and are ready to move forward to the next step that will resolve the future of our community," City Councilman Dan Garodnick said in a statement. Garodnick represents the area and lives in Peter Cooper Village.
An alterantive explanation is that Ackman, as a junior note holder, has uncovered underlying CMBS title inconsistencies to hold the transaction hostage and is hoping to extract a
nuisance payment for his $45 million investment which is now underwater. All should be revealed