Stuy Town Financing, Made Lucid
Eliot Brown Aug. 30, 2010, 11:28 a.m.
For those who find themselves confused by the mess that the fight over Stuyvesant Town has become, with different layers of creditors warring in court, someone’s taken the time to make it crystal clear in a chart:
While perhaps not the intended effect, the tangle that is the chart illustrates just why Stuy Town is so susceptible to a complex fight over ownership.
Unlike a simple home purchase gone bad — one owner who defaulted on one loan from one bank — in the $6.3 billion Stuyvesant Town deal there were a web of initial investors with equity (the top of the chart), followed by 11 layers of mezzanine debt (many of which were controlled by multiple investors), followed by the $3 billion first mortgage (which was securitized and sold off to an untold number of investors as bonds).
The chart was filed in the ongoing lawsuit between the holders of the first mortgage, special servicer CW Capital, and the investors who control the top layer of mezzanine debt, a team of Pershing Square Capital and Winthrop Realty Trust.