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Bank sells parcel of Manhattan buildings for $20M.

Bank sells parcel of Manhattan buildings for $20M

One sponsor's failed conversions has led to the one of the biggest sales of foreclosed residential property by a bank since the co-op market went sour early last year.

Maryland National Bank, the lender-turned-owner, last month sold 24 Manhattan apartment buildings in good locations to an investor group for $20 million at an estimated loss of $77 million. The bank, along with its partner in the loans BAII Banking Corp., decided to liquidate their $97 million troubled loan to converter Robert Marceca. Marceca was supposedly unable to get approvals from New York State for his conversions.

Real estate investors, led by Hamran Hakim and including members of the Manocherian family, major owners of Manhattan apartment buildings, purchased the property. The investor group was represented by Azita Aghravi at Eastern Consolidated Properties, Inc. who was the sole broker in the transaction.

The buildings comprise 480 units and include: 4-6 East 65th Street, 214 East 51st Street and 405 East 72nd Street

The bank was advised by John Winer of the Harlan Company. According to Winer, the decision to sell all the 24 properties together was two-fold -- to create intense excitement about the buildings and to sell all the buildings in a timely fashion so that the bank would not have to spend a long time marketing.

And create excitement it did. The parcel attracted investor interest from, among many others, Stanley Stahl. According to Winer, parties were welcome to bid on individual properties but the entire parcel received the most attention.

The prospective buyers had to have all completed their due diligence before one was chosen and all had to negotiate a final contract of sale with their respective attorneys before they were submitted. Finally, a binding negotiated contract was submitted in the form of a closed bid.

Winer said the bank was satisfied it got the best price available in light of the present market. The sales price represented about six times the rent roll. Some apartment buildings today are getting three times, while in the "go-go" 80's, a building could be sold for 10 times the rent roll.

Some say the sale represents a more active approach by banks to deal with their real estate problems, while others said the deal symbolized continued confidence in Manhattan residential property.

Nathan Tanen, Esq. of Tanen & Tanen, represented the purchasers in the transaction. Charles Kotick of Robinson, Silverman, Pearce, Aronsohn & Berman represented Maryland National Bank.
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Title Annotation:Maryland National Bank
Publication:Real Estate Weekly
Date:Jul 3, 1991
Previous Article:Co-op board wins case charging racial bias.
Next Article:Case brings help for beleaguered conversions.

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