The Dirt Lawyer's Blog Archive

Reports are that LBHI is looking to dump its $40 billion portfolio of real estate and securities. Given that some friends of mine are "swamped" with work, I guess I am not shocked but I am nonetheless surprised. The fact that Lehman is willing to absorb the first $5 billion in losses from its portfolio (yes, 1/8 of the price) is telling. Call me naive or ignorant, but to me that smacks of desperation if it is true. Of course, the PE types stand to do well here IF they get the assets at a fire sale price or can do flips like EOP . But lending is tight right now which makes those kinds of flips difficult. I think you might see some single asset sales of no brainer properties to funds that are flush in cash but not larger Macklowe -style deals. (We all know where THAT went.) I've never been a huge fan of mega portfolio deals from the legal side. There's a lot of risk that something could go wrong. And I'm one of those darned risk-adverse lawyers. But ther...

This Fortune profile of Harry Macklowe is really fascinating. It highlights the ups and downs of a long career in the real estate business. The story says you either love him or hate him. I don't have feelings either way, but the guy has big platinum ones for the risks he takes. According to the story: Now the 70-year-old developer is in the middle of a maelstrom of a different kind. This time it's in the credit markets. Thanks to his personally guaranteeing a $1.2 billion loan last winter, he may lose billions of dollars in real estate, his homes in Manhattan and the Hamptons, his contemporary art collection, and even his beloved yacht. This would be a bitter end to the career of one of New York City real estate's most polarizing figures. And here I am worrying about a small loan for a start-up company. They say not to worry about timing the market, but sometimes timing is everything. Take Sam Zell and the EOP deal. Was that perfect or what? Again, the story sez: I...

Although I'm glad not to be working on them right now, I will admit that all the multi-billion dollar deals that popped up in the last couple years have captivated me. Notwithstanding my most recent post on research in the market, the new big question of the day is whether the delay in the Tishman/Lehman acquisition of Archstone is a signal event. My take: Perhaps it is, for megadeals and crazy cap rates, but not for the market in general. Okay, these guys may be encountering more resistance than a few months ago in raising $17.1 billion in debt (gee, imagine that -- what is the world coming to?) or lining up some flips to cut the risk. Nor is this necessarily even a bad deal in my opinion. It just means people are not treating deals like Monopoly money right now, and that is a VERY good thing. A delay does not change the fact that there is SO much money in the market for sensible plays. I know that players are looking to make acquisitions, but only if the conditions are rig...