It’s been a long time coming, but the luxury apartments in One Madison Park may finally be put back on the market. Anyone who knows the history of this luxury condo knows that this is no small victory; the legal quagmire that included involuntary bankruptcy, defaulted loans, and ownership changes looked hopeless as recently as a few months ago. But now, a group of creditors including Related Companies., HFZ Capital, and CIM Group won control of One Madison Park last week - a federal court approved their plan to take the glass condominium tower out of bankruptcy. Related Cos. agreed to settle the majority of the outstanding claims (estimated to be in the tens of millions of dollars) a move that will allow them to complete construction at the site. According to the developers, sales on the 55 luxury condominiums in One Madison Park that are unsold could begin by the end of this year.
This sleek, unmistakable tower on 22 East 23rd Street in Manhattan’s Flatiron District has stood nearly finished but unoccupied for over 3 years now. Once regarded as a sure bet to succeed – a view quickly reinforced by multiple sales - the newly constructed high-end condo became a symbol of the real estate boom turned bust when original developers Slazer Enterprises defaulted on millions of dollars in loans and mechanics liens filed by contractors in 2009. Then, to the horror of the Manhattan apartment buyers who had already purchased apartments at One Madison Park, the situation fell apart: senior lender iStar Financial filed to foreclose on the project and in June 2010 the building went bankrupt after three creditors filed an involuntary bankruptcy petition, citing $11.6 million in unpaid loans and contractor fees.
These circumstances might have been insurmountable for any other building, but considering that One Madison Park is one of the tallest residential apartment buildings in Manhattan in a prime location directly adjacent to Madison Square Park, it’s potential value has never been questioned. It’s a beautiful building, after all, and even though it’s unoccupied this luxury high-rise has already become one of downtown Manhattan’s signature towers. Related Cos. would never have taken this on if they didn’t think it would pay off. After all, it’s a building with numerous ownership disputes that will likely be forced into the New York State Supreme Court. Related must settle all of these claims before they can get the project restarted, finish construction, and put these Manhattan luxury apartments on the market, but clearly they think the dividends are well worth the trouble.
Fittingly, the news of this deal coincided with news of the sale of the only luxury apartment in One Madison on the market. Peter Buffet, the son of billionaire Warren Buffet, bought a three-bedroom, three-bathroom apartment for $3.56 in 2009, and after listing it for $4.1 million it has gone into contract for an undisclosed amount of money. Buyers of luxury Manhattan apartments haven’t forgotten about One Madison Park (especially because it has definitely generated a lot of news), so don’t be surprised if these apartments sell fast and high.