August 19, 2008
...It is hard to gauge what types of loans Lehman owns, but there may be some similar to a $225 million New York City apartment loan that made news today, said Richard Green, professor of public policy and business at the Lusk Center for Real Estate at the University of Southern California. That loan was written on the assumption that the borrower would be able to convert about 50 percent of rent-stabilized apartments at the Riverton Apartments in Harlem to market rate apartments, boosting cash flow, and enabling the borrower to cover debt service.
"That's assuming they can navigate the politics of New York City," Green said. "That's highly speculative."...