Eagle Hospitality Avoids Foreclosure, Reaches Compromise With Blackstone

The Wall Street Journal reported this week that Eagle Hospitality Trust and Blackstone Group struck a deal to avoid foreclosure on 13 upscale U.S. hotels.  Eagle owns the 13 properties, which include the Cincinnati Landmark Marriott, and Blackstone holds the debt. Rather than proceed with foreclosure, Blackstone has agreed to accept an undisclosed amount as […]

3 Lessons for Foreclosing Lenders

In this article we will look at three lessons that can be learned from the existing case law in New York to prepare lenders for some of the defenses that borrowers may raise in foreclosure proceedings. 1. Wait for a payment default Whenever possible, lenders should wait to commence foreclosure proceedings until the borrower has […]

Considerations for Foreclosing Mezzanine Lenders – Part 2

Here, we continue our discussion of considerations for foreclosing mezzanine lenders. Type of Foreclosure In preparing to exercise remedies under the mezzanine loan documents, a lender first must determine which type of enforcement action best suits the circumstances. Mortgage vs. mezzanine foreclosure Lenders holding both mortgage and mezzanine loans on the same property will need […]

Considerations for Foreclosing Mezzanine Lenders – Part 1

During the real estate boom of the 90s and early 2000s mezzanine lending became a commonplace source of capital for developers and other sponsors. Now, as the economic downturn continues and real estate values continue to fall, more and more mezzanine lenders are finding themselves with defaulted loans. In this series, we will examine five […]

Residential Foreclosures Up 2% in New York

Bloomberg reports that the foreclosure backlog is increasing in states like New York, New Jersey and Connecticut, where foreclosures are required to pass through the court system, while the pipeline is shrinking in states that allow foreclosure by public sale, such as Arizona, California and Nevada.

Hotel Lenders Avoid Foreclosures

Bloomberg reports that lenders are doing more to avoid foreclosing on loans secured by hotel assets than any other other type of commercial real estate, as $17.5 billion in securitized hotel loans come due in the next two years in the U.S. Since the start of 2008, 53% of distressed hotel loans have been worked […]

Non-Recourse Carveout Guaranties Upheld in New York

In a pair of decisions this year, the New York Supreme Court enforced the full recourse provisions of a non-recourse carve-out guaranty where the borrower filed a voluntary bankruptcy petition. While this is good news for lenders holding these so-called bad-boy guaranties -- and one less arrow in the quivers of distressed borrowers -- there […]