Yesterday, the senior lenders of Stuyvesant Town and Peter Cooper Village, the massive East Side rental complex, reached a deal with Bill Ackman and his investors to buy his mezzanine debt, thereby avoiding a whole tangle of legal and tax issues for whatever the debt holders now have planned for the complex–likely some sort of co-op conversion. It was unclear whether the nearly unbeatable Ackman had made or lost money on the $45 million his Pershing Square Capital Management, along with Winthrop Realty, had paid for the $300 million mezzanine loan. (The senior lenders control $3 billion of the $5.4 billion loan made to Tishman Speyer and Blackrock in 2006. The complex is now valued at about $1.9 billion.)
BusinessWeek is now reporting that Ackman broke even on the deal, getting back his $45 million in exchange for backing out. A serial winner, Wily Bill was still not entirely satisfied with his results:
Ackman said in an interview yesterday that his venture was “outgunned” by CW’s legal team in court. He said he believed his interpretation of the loan documents was correct and that his venture was legally entitled to conduct a mezzanine foreclosure.
“We came to a resolution that was very smart for CW and contributes to the long-term stability of the property,” Ackman said.
Ackman also said that he still remained interested in the property and might even put together a bid with Winthrop. “We understand the asset, we know all the people, we spent a lot of time with the tenants’ association,” he told BW. “We may choose to put a plan in going forward.”