Subject: GIC $805 million investments in trouble
GIC at forefront of impending CRE disaster in America: Singapore boleh!
January 9, 2010 · Leave a Comment
It's finally happened: Stuyvesant Town is in default. So we can kiss our
US575 million goodbye (yes, it's our money, and for those who don't like to
count in USDs, it's SGD 805,000,000 - even the geniuses at GIC have to
concede that the number is equivalent to quite a few GCBs) . For background
on this, see here and here. Just don't sing "Toldja Boy".
From WSJ "Tishman, BlackRock Default on Stuyvesant Town"
Tishman Speyer and BlackRock Inc. said Friday that they wouldn't make a
full scheduled debt payment to senior lenders on Stuyvesant Town and Peter
Cooper Village, triggering default and leaving one of New York's largest
apartment complexes in limbo.
The joint venture "has been engaged in discussions with CWCapital, the
special servicer acting on behalf of the lenders, and hopes to continue
good-faith negotiations toward a potential restructuring of the debt," the
venture said in a statement.
CWCapital, which couldn't be reached for comment, is expected to issue a
notice of default over the payment, scheduled to be $16 million. The
statement didn't say how much, if any, of the payment was made.
The announcement shouldn't affect the complex's day-to-day operations,
which have become a major concern for current tenants.
A venture led by Tishman Speyer Properties and a unit of BlackRock bought
the 11,000-unit complex in 2006 in a top-of-the-market deal valued at $5.4
billion, hoping to push out longtime tenants and replace them with tenants
paying higher rents.
But the highly leveraged deal has suffered amid New York's weak economy.
Also, in October, New York's highest court ruled that owners improperly
raised rents on thousands of units removed from the city's rent-regulation
program, a ruling that sent shock waves through New York's real-estate
Well, it wasn't hard to see this coming. But take heart, fellow citizens:
despite our tiny size, we are at the forefront of one of the most damaging
financial tsunamis about to hit the world in 2010. CRE Singapore boleh.