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Bank takes back 200 Madison.

Although a roomful of people were present for the auction of the last of the Marcos properties, the lender was the only bidder for 200 Madison Avenue and secured the net lease to the 25-story office building for $23.1 million.

Lord Day & Lord, Barrett Smith associate Diane Levine, who worked with Special Master Stephen E. Estroff, said no one even qualified to bid.

"I don't know that we expected that," she said. "But it was an auction situation and it's a tough real estate market."

The ground lease for 200 Madison had been pledged as collateral for a second mortgage on Herald Center. The lender, Security Pacific, foreclosed on the first mortgage on 200 Madison Avenue and this sale was made to also satisfy a deficiency judgement resulting from the sale of the Herald Center. Both judgments amounted to more than $62 million.

Peter Hauspurg, president of Eastern Consolidated Properties, blamed the laek of auetion aetivity on the eompressed time period from the announeement of the auction to the auetion itself saying it was too short a time for a buyer to reaet.

"It is too short a fuse for someone to line up financing and line up equity," he said. "Financing a leasehold in this market is an incredible task for anyone to achieve. It's a large property and eomplicated and you must raise a substantial amount of equity as well as bank finaneing. It doesn't happen within 60 days anymore."

Hauspurg said he knows of at least three groups that are actively negotiating with the lender and he expects to .be| representing another prospective purchaser shortly with the 680,000-squarefoot property's leasehold selling soon in the $30 million range.
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Title Annotation:Security Pacific National Bank bids on New York, New York property
Author:Weiss, Lois
Publication:Real Estate Weekly
Date:Jul 29, 1992
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