Rising UCC foreclosures are “the tip of the iceberg”

first_imgFrom left: Thor Equities’ 590 Fifth Avenue, the Mark Hotel and Wonder Works’ VitreChurchill Real Estate’s Justin Ehrlich has seen a lot during his time as a developer and lender in New York. He witnessed the collapse of the real estate market during the 2008 financial crisis, followed by the mad rush to build luxury condo towers in some of Manhattan’s swankiest neighborhoods.But nothing compares to the past nine months, he said. “It’s not normal,”  Ehrlich noted. “It’s the worst I’ve ever seen.”He pointed to an unusual rise in Uniform Commercial Code foreclosures by mezzanine lenders, which he sees as a canary in the coal mine for a mound of distress expected to hit the market in the next year. While judicial foreclosures are still banned under an emergency order by New York Gov. Andrew Cuomo, UCC foreclosures on some high-stakes projects have been moving ahead in recent months since they can bypass state courts.ADVERTISEMENTWith one of the roughest years on record coming to a close, many have been waiting for their moment to jump on distressed properties. Now, mezz lenders — which provide junior debt on real estate projects — are increasingly initiating UCC foreclosures on some major developments in need of “rescue funding.”In August, for example, SL Green Realty filed a UCC foreclosure tied to a high-end retail property on Fifth Avenue owned by Joe Sitt’s Thor Equities. And most recently, CIM Group has been battling it out in court with Ziel Feldman’s HFZ Capital Group to auction off loans tied to several of the developer’s Manhattan condo projects. Matthew Mannion, who specializes in UCC foreclosures, has conducted at least eight auctions tied to mezz loans or so-called membership interests since March, according to an affidavit filed last month. And Mannion told The Real Deal that more are on the way. “This is the tip of the iceberg,” he noted.The uptick in cases presents an opportunity for deep-pocketed lenders like SL Green and CIM that may soon be able to expand their portfolios by taking over projects on the cheap. Representatives for SL Green and CIM declined to comment.“Many of the players in the mezz space are not afraid to own the asset,” said Janice Mac Avoy, co-head of Fried Frank’s real estate litigation practice.Mezzing aroundAfter the last recession, banks pumped the brakes on highly leveraged real estate deals, forcing many developers to look elsewhere for funding. Mezz debt became one of the go-to financing sources to help fill the gaps. It also has its drawbacks. Mezz lenders are often among the last to get paid back on a project. So when things go south, their positions can easily get wiped out. But mezz lenders have a trump card in UCC foreclosures. They are often processed within two to three months, much quicker than traditional foreclosures, which can carry on for years.By initiating a UCC foreclosure, a mezz lender has a chance to take over a struggling project or sell its stake in the property. In such cases, the junior lender has a huge advantage. It can place a “credit bid” on the property using the existing debt it is owed from the borrower. This allows mezz lenders to acquire assets at a lower cost than if they bought the property outright. “Mezz lenders are much more aggressive because they are in a riskier position,” said Neil Shapiro, a partner at the law firm Herrick, Feinstein.Yet UCC mezzanine foreclosures can be trickier than traditional mortgage foreclosures. Rather than being secured by the property, a mezz loan is converted to an equity interest in the business. So if the junior lender succeeds in a foreclose, it becomes the property’s primary owner and must make payments on the senior debt.But Mac Avoy said banks and other senior lenders are often more apt to work with subordinate lenders — which usually have no prior history of default — than troubled borrowers. “Lenders aren’t thrilled doing business with someone who isn’t able to pay them back,” she noted.When considering a foreclosure, mezz lenders have to decide if the project is worth more than its debt. If not, the mezz lender can try to sell its loan or work with the borrower on restructuring the loan terms. “I am seeing the beginning of a lot of lenders saying, ‘We can’t do nothing,’” said Jay Neveloff, a commercial real estate lawyer and partner at New York-based Kramer Levin Naftalis & Frankel. Lenders are getting especially antsy with borrowers who have been behind on payments for some time. Such is the case with Mack Real Estate Group, which is seeking to foreclose on the second phase of the Denizen — All Year Management’s luxury apartment complex in Bushwick. Yoel Goldman’s Brooklyn-based firm was unable to close on a $652 million refinancing for the 900-unit rental complex and has halted payments to its bond investors in Israel. Representatives for All Year and Mack did not respond to requests for comment.Courtroom dramaIn New York’s high-flying real estate market, nothing comes easy.So as more lenders seek to foreclose on assets, more borrowers are filing lawsuits to stop them.In one of the most high-profile cases so far, Los Angeles-based developer and lender CIM sought to foreclose on mezz positions on four of HFZ’s Manhattan condo projects.The day before the planned auction last month, HFZ filed a lawsuit seeking to stop the sale, arguing that it was “commercially unreasonable.” The developer claimed that CIM’s two-month auction notice was indefensible and called the foreclosure effort a “predatory attempt to capitalize on the Covid-19 pandemic.” The judge ruled in HFZ’s favor and halted the auction for the time being.Wonder Works Construction made similar claims in a lawsuit against New York-based mezz lender Nahla Capital. The lender sought to foreclose Wonder Works’ Upper East Side condo development Vitre, noted for its shiny glass façade. Nahla hired a team of JLL brokers to market the loan back in October.But a judge denied Wonder Works’ lawsuit, noting that the firm had been in default on its loan payments since January. The auction went ahead this month, and Nahla won a credit bid on the property to essentially become the owner.Representatives for Wonder Works did not respond to a  request for comment.Generally speaking, Neveloff said, borrowers usually file lawsuits to “buy time” to negotiate on payments. In at least one case, this has proved to be a successful strategy. In May, Beverly Hills-based Ohana Real Estate Investors sought to foreclose on the five-star Mark Hotel on the Upper East Side and sell the hotel through auction. Alexico Group, the hotel’s owner, filed a lawsuit, which led to a judge delaying the sale for 30 days. That bought Alexico time, and the two parties were eventually able to reach a settlement, which increased the principal and interest rate on the mezz debt, Bloomberg reported. Ohana and Alexico declined to comment.The lawsuits can delay a sale, but ultimately a developer has to find money to pay its lenders. If not, Mac Avoy said, it will be similar to what occurred in the last crisis. “It’s the musical chairs … of different ownership,” she noted This content is for subscribers only.Subscribe Nowlast_img read more

HFF arranges $14M in joint venture equity for Scottsdale condo project

first_imgHFF announced today that it has arranged $14M in joint venture equity for the development of Envy, a 90-home, mid-rise condominium project in downtown Scottsdale’s Entertainment District.HFF worked on behalf of the borrower, Deco Communities, to secure joint venture equity from an alternative investment manager.Envy will be situated on a one-acre site at 4422 North 75th Street near the intersection of Camelback and Scottsdale Roads.  Slated for completion in the second half of 2015, the 90 for-sale residences will feature a variety of one- and two-bedroom floorplans.  The eight-story property will include amenities such as a 4,500-square-foot, state-of-the-art fitness center with lounge and juice bar, mezzanine lounging area, underground parking, negative-edge rooftop pool and spa, bicycle storage, electric car charging stations and concierge service.The HFF team was led by associate director Bryan Clark.last_img read more

Interaction between Trade and Labour – the Future of Work in the Caribbean

first_img Trade in Services – For CARICOM, Tourism dominates Thus here in the Caribbean where international trade is critical to economic growth and development, we must be aware of the link between trade and labour and be engaged in the discussions now taking place on the future of work in this new industrial age. Jamaica has been celebrating the highest increase in employment in many years due to investments in trade in services through business process outsourcing (BPOs) and tourism. This employment increase is linked to international trade. Nevertheless, there is concern about our preparations for looming changes in employment, including increasing automation in the BPO sector. Many countries in the Caribbean commemorate Labour Day in May, most on May 1 to coincide with International Labour Day and its activities. As we in Jamaica prepare to mark Workers’ Week, May 17-24, and Labour Day on May 23, we need to be examining the relationship between trade and labour and building awareness of the ongoing work and discussions on the future of work. I note that during the week an event will be held to commemorate the centenary of the ILO, 1919-2019, and the Trade Unions Act of Jamaica. I did not see an event on the Future of Work. This Future of Work question came to my attention when the report issued by the ILO Global Commission on the Future of Work entitled “Work for a brighter Future” was recommended as a must read. In addition, in the Barbados Advocate newspaper of May 10, it was reported that on May 8, the Sir Arthur Lewis Distinguished Lecture was delivered by Professor Emieritus Hilbourne Watson on the subject “Transnational Capitalist Globalization and Caribbean Future: Unlimited Supplies of Labour and the Robot Rampage”. The Professor, it was reported, pointed out that in the production of goods and services, humans are not just competing with but are being replaced by machines, robots, and other smart devices and there are implications for Caribbean. My research reveals that work on the future of work has been ongoing since 2016 when the World Economic Forum published its first future of jobs report – The Future of Jobs: Employment, Skills and Workforce Strategy for the Fourth Industrial Revolution. In 2017, the ILO, approaching its centenary, launched its Future of Work Initiative and established the Global Commission, co-chaired by President Cyril Ramaphosa of South Africa and Prime Minister Stefan Löfven of Sweden. The ILO noted that the world of work is undergoing a major process of transformation due to, among other things, advances in technology and the impact of climate change on production and employment. The Commission’s report will be discussed at the centenary session of the International Labour Conference to be held in Geneva, Switzerland, June 10-21. This Conference is expected to be addressed by Heads of State and Government. Leading up to the Conference, the ILO invited Member States to organize events to mark the centenary and to discuss the Report on the Future of Work as the Initiative is to culminate at the Conference. In preparation for and to ensure its input, the Caribbean has been engaged in studies, consultations and meetings as follows: 2017 – ILO/SALISES Study on the Future of Work in the Caribbean: What do we know? What do we need to know? 2018 – Inter-American Development Bank (IADB) – Series on the Future of Work in Latin America and the Caribbean: A Great Opportunity for the Region? An ILO Meeting on the Future of Work in the Caribbean was also held in Panama in October 2018 at which the CARICOM Human Resource Development (HRD) 2030 Strategy and its role in enabling employability was presented. 2019 – ILO Bureau of Workers Activities and Office in the Caribbean convened a High Level Conference on the Future of Work in the Caribbean in Port of Spain, Trinidad and Tobago, February 14-15, to encourage discussions in the region. The 11th Meeting of Caribbean Labour Ministers will be held in Barbados, May 14-15, and the Ministers are expected to discuss the ILO’s Future of Work report. ILO meetings/consultations usually take a tripartite approach involving representatives of government (Ministry of Labour), employers (Employers Federation) and workers (trade unions). Given the importance of these discussions on the future of work and the link to trade and development, I would hope that to ensure coherence, consultations on the ILO report would have included other Government Ministries such as Foreign Affairs and Foreign Trade, Economic Growth and Job Creation, Finance, Education, Industry and Commerce, Agriculture, Gender and Culture, and Tourism and that other private sector bodies would be included such as Exporters, Manufacturers, the Chambers of Commerce and Small Businesses. At the regional level, I would have liked to read that CARICOM organs such as the Council for Finance and Planning (COFAP) and the Council for Trade and Economic Development (COTED) as well as the Council for Human and Social Development (COHSOD) reviewed this significant ILO Report. Although there have been some reporting in the media on the future of work, I would like to see more focus on this issue during Workers’ Week and leading up to the International Labour Conference in June. By Elizabeth Morgan We are apparently in the second machine age of the fourth industrial revolution. Investors want to remain competitive in global trade. The challenges being faced include aging workers in some regions including the Caribbean; facilitating movement of labour – migration issues; reducing cost of employment – less benefits to workers, more contracts including zero hour contracts; increasing resort to technology and automation – robots, driverless cars, self-service checkouts, online banking and shopping; digitization trending towards a “gig” economy with a flexible workforce and hours; new industries – green and blue; re-training of workers, and lack of capacity to respond to evolving requirements of the global labour market. These present risks and opportunities for the Caribbean in investment, trade, employment, and sustainable economic growth and development. It is recognized that labour plays a significant role in international trade and competitiveness. A study undertaken by the World Trade Organization (WTO) and the International Labour Organization (ILO) in 2007 concluded that trade and labour and social policies interact and greater coherence can significantly impact trade reforms and the quality of jobs. In the UN Sustainable Development Goals (SDGs), key related goals are 4 -quality education that is inclusive, equitable and promotes lifelong learning opportunities for all;  8 –  decent work and economic growth promoting sustained, inclusive sustainable growth, full and productive employment and decent work for all;  and  17 pointing to partnerships with international trade as a key means of implementation. Trade-in-Services and Technology: More missed opportunities… Relations within the Western Hemisphere: an uneasy alliance Oct 14, 2020 Oct 7, 2020 You may be interested in…center_img Oct 1, 2020 Sep 29, 2020 Submitted by Elizabeth Morgan, Specialist in International Trade Policy and International Politics. ILO: Centenary Declaration for the Future of WorkBy Elizabeth Morgan I am returning to an article I wrote in May on the Future of Work. In that article, I referred to the link between trade and labour and informed that the report of the International Labour Organization (ILO) Global Commission on the Future of Work titled “Work…August 15, 2019In “Featured”Impact of Population Issues on Foreign TradeBy Elizabeth Morgan The COVID-19 pandemic is highlighting some issues which I had not fully explored. One of these is the impact of population issues, such as demographic shifts, on foreign trade. COVID-19’s ravishing of Italy and Spain in Europe brought to the fore the issue of Europe’s aging population.…April 8, 2020In “General”CARICOM’s Economic Independence: Role of Foreign TradeBy Elizabeth Morgan August is a significant month in Caribbean liberation history. The Anglo-Caribbean countries commemorated Emancipation Day, marking the official end of slavery. Jamaica and Trinidad and Tobago celebrate 57 years of Independence on August 6 and 31 respectively. The Rt. Hon. Norman Manley expressed the view that his…August 7, 2019In “CARICOM”Share this on WhatsApp Share this:PrintTwitterFacebookLinkedInLike this:Like Loading… Ahead of Biodiversity Summit, UN Officials call for Action… last_img read more

Wm. O’Brien opens in the USA

first_imgThe heavy lift engineering solutions provider is currently working on a number of projects in North America, with wind energy and heavy industry projects in Illinois, New York and Boston.The office will act as a hub to better serve the needs of its growing customer base in the region, said Wm. O’Brien.“We are very excited to open our first US office as it builds upon our strategic plans for continued growth and development across North America and will enable us to respond effectively to the growing needs of our varied customers,” said William O’Brien, managing director of Wm. O’Brien.www.wobcranehire.comlast_img read more

Exclusive: Vitolo reaches an agreement with Atletico Madrid

first_img After four years with Sevilla, there is an agreement between all three parties for the 27-year-old to become the first signing at Atletico this summer.  Sport.es Simeone wants to take advantage of the Spanish international’s versatility, given he can play at right-back as well as in a range of forward positions.  Vitolo will cost Atletico 40 million euros, which is the cost of his release clause and there was also some interest shown by Barcelona.  IN SPORT.ES Sevilla forward Vitolo Machín has an agreement in principle to join Atletico Madrid for the 2017-18 season.  Noticia SPORT: Vitolo llega a un acuerdo con el Atlético de Madridcenter_img Upd. at 10:21 22/05/2017 Regardless of the potential transfer ban, Vitolo was Cholo Simeone’s top target. The Argentine coach want to push a deal no matter what happens with the outcome of their appeal to the Court of Arbitration for Sport — even if it means he can’t play until January 2018.  CEST Talking recently, Vitolo said that “if Sevilla intend to sell me, I will accept it, it’s a decision between both parties, so we will see. There’s still nothing yet.”last_img read more

Coach and student Yogeshwar and Bajrang talk about the Olympic dream

first_imgYogeshwar and Bajrang shared their 2020 Olympics plansAdvertisement 3vk0vNBA Finals | Brooklyn Vsrhj0kaWingsuit rodeo📽Sindre Ekyf( IG: @_aubreyfisher @imraino ) lWould you ever consider trying this?😱787Can your students do this? 🌚0fuuRoller skating! Powered by Firework Olympic bronze medallist Yogeshwar Dutt and Asian Games and Commonwealth Games gold medallist Bajrang Punia were recently interviewed by PTI on the sidelines of their preparation for the 2020 Olympics.Advertisement Olympic bronze medallist Yogeshwar Dutt and Bajrang Punia shared plans for the 2020 Tokyo OlympicsWhen asked on why he decided to call it a day, Yogeshwar Dutt alluded that he did so in order to train Bajrang for gold. “If it was not for Bajrang, I would not have quit the mat. I would have competed more and may be could have moved up a category. But I thought, it is a right decision. He is only 24. Since his junior days, he showed spark. I want people of India to see Yogeshwar in Bajrang now. I had a long career and I don’t want that Bajrang gets affected,” said 36-year-old.When Bajrang was asked how he could maintain such a hectic training schedule, he replied that he had to overcome three temptations. “I always wanted to have a cell phone. But When I started playing international events in 2010, Yogi Bhai advised against it. I have never gone for sight-seeing after my competitions abroad. I have never been to a cinema hall. Whatever movies I have watched, I have watched on TV.”Advertisement Salute to Bajrang and Yogeshwar’s sacrifices so that they can bring glory to the nation. Let’s hope that they strike gold at the 2020 Tokyo Olympics.Advertisement Advertisementlast_img read more

Simple scan a life saver

first_imgBy ANEEKA SIMONIS THE Rotary Club of Pakenham will be conducting the bowel scan program over the month of May….[To read the rest of this story Subscribe or Login to the Gazette Access Pass] Thanks for reading the Pakenham Berwick Gazette. Subscribe or Login to read the rest of this content with the Gazette Digital Access Pass subscription.last_img

Adam Challoner Wins Connacht U11 Boys Trophy

first_imgAdam Challoner from Mountbellew was the winner yesterday of  Connacht u-11 Boys Trophy in County Sligo golf club. Adam shot a 74 gross off 11 handicap for 44 pts and qualifies for the All Ireland final in Headfort golf club in Kells next month. print WhatsApp Facebook Twitter Emaillast_img

Masterson set to Captain Connacht in Challenge Cup Clash with Worcester

first_imgEuropean Rugby Challenge Cup Round 4, Kingston Park, Newcastle, England 20/12/2015Newcastle Falcons vs ConnachtNewcastleÕs Sonatane Takulua and Eoghan Masterson of ConnachtMandatory Credit ©INPHO/James Crombie Eoghan Masterson is set to captain Connacht in their Challenge Cup game against Worcester in the Sportsground tomorrow (3pm). The 24-year-old takes his place at number 8 in a back row that includes Eoin McKeon at blindside and James Connolly at openside. There is also a new-look front row from the team that started the round one bonus point win away to Oyonnax. Denis Buckley comes in at loosehead and Dave Heffernan and Dominic Robertson-McCoy are included at hooker and tighthead respectively.  In the backs, Bundee Aki returns to the centre alongside Eoin Griffin in the centre. Tiernan O’Halloran is also back in the side at full back after a brief injury.center_img Connacht’s record try scorer in European competition Matt Healy, who scored two tries in the opening round, is included in the starting XV.He spoke to reporters about the challenge that Connacht face tomorrow: “We had a great travelling support last week in Geneva and we were delighted with the bonus point win. So, we had a review of the Oyonnax game and very quickly moved on and started focusing on Worcester. We are delighted to be back in the Sportsground in front of our home support. Worcester will bring a big challenge, they had a good win last week and, like ourselves, will be looking to gain a bit of momentum this weekend.”#CONvWORKick-off 3.00pm:(15-9) Tiernan O’Halloran, Darragh Leader, Bundee Aki, Eoin Griffin, Matt Healy, Jack Carty, Caolin Blade, (1-8) Denis Buckley, Dave Heffernan, Dominic Robertson-McCoy, Quinn Roux, James Cannon, Eoin McKeon, James Connolly, Eoghan Masterson (Capt)Replacements (16-23): Shane Delahunt, Peter McCabe, Conor Carey, Cillian Gallagher, Jarrad Butler, Kieran Marmion, Craig Ronaldson, Cian Kelleher.print WhatsApp Facebook Twitter Emaillast_img read more

Micheal Donoghue Looks Ahead To Antrim In The National Hurling League

first_imgGalway Manager Micheal Donoghue Spoke To Sean WalshAudio Playerhttps://download-galwaybay.sharp-stream.com/MICHEAL%20DONOGHUE%20PRE%20ANTRIM.mp300:0000:0000:00Use Up/Down Arrow keys to increase or decrease volume. Eight players have been added to The Galway Senior Hurling panel ahead of their National Hurling League Opener with Antrim on Sunday next in Pearse Stadium. They are Shane Cooney of St Thomas, Conor Cosgrave of Ardrahan, Sean Linnane of Turloughmore, Brian Concannon of Killimordaly, Joseph Mooney of Loughrea, Shane Bannon of Clarinbridge, Kevin McHugo of Tommie Larkins and Jack Coyne of Castlegar. print WhatsApp Facebook Twitter Emailcenter_img Galway will be without a number of players from the team that won the All Ireland title in September ahead of their National league opener against Antrim on Sunday with the likes of Captain David Burke and Player of the Year Joe Canning not expected to play until later on in the competition.last_img read more