The developer of the Cassa NY Hotel and Residences at 70 West 45th Street sought bankruptcy-court protection for the hotel and condo project, blaming its financial challenges on litigation involving its contractors and subcontractors, according to an article by Jacqueline Palank today at wsj.com.
Waterscape Resorts LLC, an affiliate of the New York real-estate company Assa Properties, said in court papers its operations "remain strong" despite the economic downturn that has hit real-estate owners and hospitality businesses especially hard, the article said, adding that it said that "its financial problems stemmed from various contractors and subcontractors that have filed about $20 million in mechanic's liens against the property in an effort to ensure that they receive payments."
Those liens have hurt Waterscape's efforts to sell condominiums, according to a spokeswoman for Waterscape, Kathleen Duda, the article said, adding that "Waterscape said that without revenue from apartment sales, it defaulted on a principal payment obligation under its loan agreements."
"As of Tuesday," the article continued, "Waterscape reported $168.5 million in total assets and $141.5 million in total debts. The senior lender on the project, U.S. Bank, is owed approximately $126 million, and junior lender UBS Capital Resources Inc. is owed about $8 million. In its court papers, Waterscape also said that it has an offer to buy the property for $126 million from an entity named 70 West 45th Street Holding LLC. Two attorneys representing the proposed buyer - Harvey A. Strickon of Paul, Hastings, Janofsky & Walker and Allen Wu of Wu & Kao - declined to comment when reached Wednesday."
The article said that "Waterscape acquired the property, near Times Square, for $20 million in 2005" and "financed the purchase with a $17 million acquisition loan and mortgage from U.S. Bank."
Construction began on the property's 165 hotel rooms and 57 apartments began in 2007, and was completed by the end of September 2010.
"As of the end of last year," the article said, "Waterscape had sold five residential apartment units for a total of $12.7 million. Efforts to restructure the loans didn't pan out, resulting in UBS filing a foreclosure action against Waterscape on March 21.
The 48-story, mid-block tower was designed by Ten Arquitectos, of which Enrique Norten is a principal.
Waterscape Resorts LLC, an affiliate of the New York real-estate company Assa Properties, said in court papers its operations "remain strong" despite the economic downturn that has hit real-estate owners and hospitality businesses especially hard, the article said, adding that it said that "its financial problems stemmed from various contractors and subcontractors that have filed about $20 million in mechanic's liens against the property in an effort to ensure that they receive payments."
Those liens have hurt Waterscape's efforts to sell condominiums, according to a spokeswoman for Waterscape, Kathleen Duda, the article said, adding that "Waterscape said that without revenue from apartment sales, it defaulted on a principal payment obligation under its loan agreements."
"As of Tuesday," the article continued, "Waterscape reported $168.5 million in total assets and $141.5 million in total debts. The senior lender on the project, U.S. Bank, is owed approximately $126 million, and junior lender UBS Capital Resources Inc. is owed about $8 million. In its court papers, Waterscape also said that it has an offer to buy the property for $126 million from an entity named 70 West 45th Street Holding LLC. Two attorneys representing the proposed buyer - Harvey A. Strickon of Paul, Hastings, Janofsky & Walker and Allen Wu of Wu & Kao - declined to comment when reached Wednesday."
The article said that "Waterscape acquired the property, near Times Square, for $20 million in 2005" and "financed the purchase with a $17 million acquisition loan and mortgage from U.S. Bank."
Construction began on the property's 165 hotel rooms and 57 apartments began in 2007, and was completed by the end of September 2010.
"As of the end of last year," the article said, "Waterscape had sold five residential apartment units for a total of $12.7 million. Efforts to restructure the loans didn't pan out, resulting in UBS filing a foreclosure action against Waterscape on March 21.
The 48-story, mid-block tower was designed by Ten Arquitectos, of which Enrique Norten is a principal.
Architecture Critic
Carter Horsley
Since 1997, Carter B. Horsley has been the editorial director of CityRealty. He began his journalistic career at The New York Times in 1961 where he spent 26 years as a reporter specializing in real estate & architectural news. In 1987, he became the architecture critic and real estate editor of The New York Post.
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