Billy Macklowe may have deposed his father, Harry, and their overleveraged troubles may have become yet another chapter in the New York City’s rich history of fortunes won, fortunes lost and fortunes just barely rescued, but the detritus of the Macklowe midtown empire lives on in a state of purgatory.
Nary a peep has been heard in recent months about the four remaining towers that Deutsche Bank put on the block earlier this year. Deutsche reclaimed the $7 billion, seven-tower portfolio after Macklowe Properties defaulted on the $5.8 billion worth of loans from the bank that were required to buy the buildings in 2007. Three of the seven have since sold. The non-sellers are, in no particular order, Tower 56 at 126 East 56th Street, 527 Madison Avenue, Worldwide Plaza at 825 Eighth Avenue, and 1540 Broadway.
This summer, Somerset Partners was reported to be zeroing in on 527 Madison; and the Chicago-based Transwestern was said to be taking Tower 56. But those deals haven’t closed.
According to one knowledgeable broker, both deals were only soft contracts: “I hear Somerset was having a very hard time getting 527 Madison done, and that Transwestern went in for a re-trade for their contract at Tower 56.”
When we posited that maybe the lack of activity was due to the annual lull that accompanies Labor Day, the source responded, “It’s not the time of year. The market sucks.”