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Dubai's Istithmar Loses Prime U.S. Property-Paper - ASHARQ AL-AWSAT English Archive
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DUBAI, (Reuters) – Istithmar World, a unit of Dubai World, has handed over a prime New York residential building to Danske Ban after failing to pay its mortgage, a UAE daily reported on Thursday, the loss of its second property in Manhattan since December.

Istithmar, whose parent company is looking to restructure $22 billion in debt, bought the building, formerly known as the Knickerbocker Hotel, in New York’s Times Square for $300 million in June 2006, during the firm’s heyday when it was on the acquisition trail.

“We have hired Jones Lang LaSalle to market the property. We do not expect further write-downs on the property,” The National newspaper quoted Anders Klinkby Madsen, spokesman for Danske, Denmark’s largest lender, as saying.

A spokeswoman for Dubai World declined to comment.

LEM Mezzanine took control of the W New York Union Square hotel from Istithmar in December for $2 million in a New York foreclosure sale.

Istithmar also has the W Washington D.C. and Mandarin Oriental New York in its portfolio.

Dubai World is seeking to offload assets as part of a restructuring plan after the state-owned conglomerate rocked global markets last November when it asked for a delay on paying $26 billion in debt linked to its main property units.

Istithmar hired an advisory firm in August to help it mull options to shore up the financial position of its U.S. luxury retailer Barneys amid speculation it is freezing investments as part of a restructuring that may result in the sale of the fund or its assets.

Istithmar sold its entire holding in Indian budget airline SpiceJet this year for $35.23 million.

It also plans to sell port and shipping agent Inchcape Shipping Services (ISS) for up to $700 million.

Asharq Al-Awsat

Asharq Al-Awsat

Asharq Al-Awsat is the world’s premier pan-Arab daily newspaper, printed simultaneously each day on four continents in 14 cities. Launched in London in 1978, Asharq Al-Awsat has established itself as the decisive publication on pan-Arab and international affairs, offering its readers in-depth analysis and exclusive editorials, as well as the most comprehensive coverage of the entire Arab world.

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