Crain’s Business: 225 Rector Street
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Crain’s Business: Marc Held, Partner at Held & Hines, LLP quoted re: 225 Rector Street
September 30, 2010 1:03 PM
Auction date looms for 225 Rector 232 unsold units, along with parking garage and commercial space in the residential tower owned by beleaguered developer Yair Levy to hit the sales block in November. Share Print Email Comment By Amanda Fung Buck Ennis [+] Enlarge Basketball players in Battery Park City, Manhattan. Also See * Controversial benefit-agreement report aired * Work on Aqueduct racino to begin in Nov. * Tax break extended for unfinished 1-family homes Filed Under : Battery Park City, Residential Real Estate, Yair Levy Where : New York, New York City, Manhattan, Downtown, Battery Park City Deeply troubled Anglo Irish Bank Corp. is close to achieving a modest victory in Manhattan. The bank is expected to soon set the date for the foreclosure auction for all the unsold units of beleaguered developer Yair Levy’s failed condo conversion, Rector Square in Battery Park City. The 232 units, along with the parking garage and commercial space in the residential tower, located at 225 Rector Pl., will be auctioned off in a bulk sale on Nov. 17, said Chris Sullivan of the law firm of Herrick Feinstein, which represents Anglo Irish. According to the court order filed Sept. 28, the bank is owed roughly $135 million. With a recommendation set forth by a hired expert, Anglo Irish determined that the higher bid would be obtained if the building was sold as one parcel, according to the court filing. Only 72 units at the building have been sold to date. “There has been interest from large funds that have the wherewithal to make a serious bid,” Mr. Sullivan said. “The bank is hopeful that [the property] will be sold for a maximum price.” Related Cos., which was appointed by Rector Square’s receiver, Michael Miller, to manage the property, is also rumored to be interested in bidding on the site.
The new owner of the building could choose to continue the conversion or maintain it as a rental property. Meanwhile, the 45 tenants at Rector Square who are suing Mr. Levy and other parties involved in the botched condo conversion project for $100 million are anxiously awaiting the results of the auction. The decision on their lawsuit is still pending. “Whoever buys these units will share the building with my clients,” said Marc Held of law firm [Held & Hines], which is representing the Rector Square tenants. “There is still work to be done at the building. The unit owners want the party that wins the auction to consider their interest, finish work that wasn’t completed by Mr. Levy and adhere to the original terms of the offering plan.” Earlier this year, Anglo Irish was granted the right to foreclose on the 304-unit Rector Square. Last year, Mr. Levy’s development firm, YL Real Estate Developers, defaulted on its $165 million mortgage on Rector Square. In its defense, YL Real Estate claimed that Anglo Irish did not comply with its loan obligations, which stalled the condo-conversion project. Additionally, this summer the New York attorney general’s office filed a lawsuit against Mr. Levy charging the developer with defrauding purchasers at his failed Battery Park City condo conversion out of about $7.4 million. According to that suit, the developer raided the building’s reserve fund, which was supposed to be used to ensure that repairs and improvements were made at the building.
