After months of wrangling for the keys, hedge fund biggie Bill Ackman has officially lost his bid to become mayor of the massive Manhattan apartment complex Stuyvesant Town-Peter Cooper Village.
Yesterday, a state appeals court rejected Ackman’s last-ditch effort to halt a planned foreclosure of the property by senior debtholders.
The ruling means debtholders of the $3 billion first mortgage — led by special mortgage servicer CW Capital — can move forward with a foreclosure set for Monday, paving the way for a sale of the property to the highest bidder.
Ackman’s Pershing Square and his partner in a joint venture, Winthrop Realty, invested $45 million to gain control of a key $300 million slice of a $1.4 billion second mortgage.
Earlier this month, the state Supreme Court quashed their plans to use that position to gain control of the 11,227-unit property by foreclosing on the entity that is responsible for the first mortgage without first paying off the $3.66 billion owed to senior lenders.
After the injunction blocking Pershing and Winthrop, they asked the appeals court to stop the senior lenders from foreclosing on the property. The court rejected their request yesterday.
Although Ackman won’t be able to stop the foreclosure by senior lenders, he can still fight in court to recoup the full value of his $300 million in debt plus his potential profits from the lost deal.
“I know we will be vindicated on the merits of our appeal,” said Edward Weisfelner, an attorney for Ackman.