NEW YORK (Reuters) - A New York judge has blocked
two sets of competing creditors from conducting foreclosure
auctions related to one of the nation's biggest housing
complexes until he decides which can proceed.
"I am not permitting any foreclosure on either side until
my decision," New York State Supreme Court Justice Richard Lowe
said at the conclusion of a hearing Thursday. The judge did
not indicate when he would rule.
Until a decision is rendered, neither a joint venture led
by hedge fund manager William Ackman's Pershing Square Capital
Management LP nor holders of the senior mortgage on the
Stuyvesant Town and Peter Cooper Village complex in Manhattan
will be permitted to proceed with their respective plans.
Home to more than 25,000 residents in 56 buildings, the
iconic Manhattan complex symbolizes the overheating of U.S.
commercial real estate, after buyers led by Tishman Speyer
Properties LP defaulted on loan payments.
Tishman in 2006 paid $5.4 billion for the 80-acre complex.
The property is thought to be worth less than half that sum.
Pershing and Winthrop Realty Trust which bought a
defaulted $300 million junior loan for 15 cents on the dollar,
had sought to foreclose on PCV ST, the company that owned the
property, by Sept. 8.
The senior mortgage was sliced into bonds, and holders of
those bonds were proceeding to foreclose on the property later
in September. Holders of those bonds are represented by special
servicer CWCapital Asset Management LLC, and Bank of America
Corp and US Bancorp serve as trustees.
The case is Bank of America NA et al v. PSW NYC LLC, New
York State Supreme Court, New York County, No. 651293/2010.
(Reporting by Jonathan Stempel in New York; editing by Ilaina