More Financial Bad News for Mets Owners
In what has become our weekly financial update on Sterling Equities, it appears that Saul Katz and Fred Wilpon have another business that’s struggling with money.
According to the Wall Street Journal, a drop in the value of commercial property has put one of the Mets owners’ real estate funds into a tailspin.
… the largest of the real-estate funds they invest in and control, the $609 million Sterling American Property V fund, has seen values decline significantly and troubled properties accumulate.
Last year, a loan servicer filed to foreclose on two office buildings in Fairfield, N.J., where the fund defaulted on a $35 million mortgage, according to loan research service Trepp LLC. Sterling said it is negotiating with the firm in an attempt to hold on to both properties.
In 2009, the Sterling fund agreed to hand over to lenders its 43-story tower at 333 Bush Street in San Francisco after a major tenant went bankrupt.
The fund’s investors have been hurt. Of the $35 million that the Teachers Retirement System of Louisiana put into the Sterling fund, its investment at the end of 2010 was valued at $18.1 million, according to the Louisiana fund’s chief investment officer.
Countless other funds and real-estate investors that invested at the market’s peak are in similar straits. Many are avoiding selling, hoping that values will increase enough to wipe out some or all of the possible losses they are facing.
There are other examples cited and associated financial mumbo-jumbo that doesn’t really have a place here, but if you’re interested in that sort of thing, read the entire story here.
Man, when it rains it pours.