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Re: Manhattan Club Lawsuit (by Chris V.):

charlesm548 wrote:

Eichner may have had an in with Bloomberg, but maybe DeBlasio is willing to do something. Anyone on this thread know someone in the NY Mayor's office?

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Getting to know the creep ...

Where do you live now?

(Eichner) I’ve been living at 52 Park Avenue. I’m about to move into a new apartment at One Morton Square.

Do you have other homes?

(Eichner) In East Hampton, Las Vegas and South Beach.

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Property Mogul Poised to Take a Second Fall (2008)

Eichner in Talks to Surrender Casino to Deutsche Bank; 'Zero Will Stick to My Shoes' he said.

By JENNIFER S. FORSYTH Updated May 9, 2008 12:01 a.m. ET

LAS VEGAS -- Sixteen years ago, developer Ian Bruce Eichner was forced to give his lenders the keys to his newly finished office tower in Times Square. The empty building, a symbol of one of the worst downturns in U.S. commercial real-estate history, ultimately cost his lenders and partners about $200 million.

Mr. Eichner, a slender, fast-talking New Yorker, managed to stage a second act -- but it appears to be ending much like the first. Cosmopolitan Resort Casino, the casino-hotel complex he's building on the Las Vegas Strip, got caught last year in the capital-markets crisis and is headed toward foreclosure. Deutsche Bank AG has sunk nearly $1 billion into the project, and two other lenders have provided $175 million. It's unclear how much of it they'll be able to recoup.

Losing Hand

The News: Developer Ian Bruce Eichner is on the verge of losing control of his Las Vegas casino-resort project to his lenders. The Background: Commercial real-estate lenders have been growing more nervous about the market, which made it difficult for Mr. Eichner to get financing. What's Next: Talks under way now will determine who takes over the partially completed project. On Thursday, Mr. Eichner and representatives of Deutsche Bank were deep in discussions that are expected to end with the 62-year-old developer surrendering all involvement with the partially completed project, people familiar with the discussions say.

In an interview earlier this year, Mr. Eichner said he was a victim of the credit crisis, and that banks eventually would lend to him again. "It's probably pretty safe to say that somewhere in 2009 or 2010, Bruce Eichner will surface with another one, something," he says. "There's zero that will stick to my shoes."

Mr. Eichner's roller-coaster track record shows that in commercial real estate, failure on an epic scale need not be a career killer. Other prominent developers also had to surrender projects to lenders in the 1990s, only to borrow more money and fail again in the most recent cycle. Earlier this year, New York developer Harry Macklowe, who gave back several buildings more than a decade ago, defaulted on short-term loans he used last year to buy seven Manhattan skyscrapers for $7 billion, because he was unable to line up long-term financing.

The willingness of lenders to give such developers more money helped fuel the commercial real-estate boom that started in 2003 and reached its zenith in early 2007. Some of those lenders now face the potential for loan losses. Centro Properties Group, one of the largest shopping-center owners in the U.S. and Australia, for example, has been unable so far to repay $4.9 billion in short-term debt owed since December to creditors including J.P. Morgan Chase & Co., Bank of America Corp. and Commonwealth Bank of Australia.

Hardly anyone is predicting that souring commercial real-estate loans will cause the kind of banking crisis that struck in the late 1980s and early 1990s, when large banks in the U.S. and Japan had sizable chunks of their loan portfolios tied up in the collapsing sector. Although commercial real-estate values have softened in some markets, they haven't experienced the kind of free fall that occurred back then.

And this time around, lenders tried to spread the risk. They gathered loans into pools and sliced them up for sale to investors as commercial mortgage-backed securities, much as housing lenders did on the consumer side of the market. So far, securities backed by commercial mortgages are performing far better than their residential counterparts, whose implosion helped set off today's broader credit crunch.

But like residential lenders, some commercial real-estate lenders, including Wall Street investment banks, were lulled by sharp increases in property values and projections for fat profits. Competition among lenders was so intense that developers were allowed to kick in less and less of their own money -- sometimes less than 1%.

Ideal Environment It proved to be an ideal environment for battered developers to stage their comebacks. To be sure, they couldn't do business with some of the lenders who backed them previously. But there were plenty of others.

"If I or anyone else needed money, you could call up the bank and they would send a Brinks truck over to your office," says Donald Trump, who admits to have put "some hurt on banks" in the early 1990s, during the prior cycle. "There was so much money flowing, so much money." Mr. Trump, having bounced back, in recent years built residential towers in Manhattan and forged lucrative licensing deals that added his name to dozens of luxury buildings around the world.

For Mr. Eichner, who brags that he finished last in his law-school class at the University of Cincinnati, the 1990s brought plenty of trouble. Besides giving back the Times Square building, called 1540 Broadway, he lost CitySpire, billed at the time as Manhattan's tallest apartment house, to his creditors in 1992. In 2000, subcontractors who hadn't been paid forced his Park Central Hotel, another New York project, into bankruptcy-court protection. Yet because Mr. Eichner relied heavily on debt and contributed little of his own money, the failure of the projects didn't lead to ruinous personal losses, people familiar with the projects say.

At least one lender vowed never to lend to Mr. Eichner. Bernd Knobloch, chief executive of Eurohypo AG, a bank based in Eschborn, Germany, recalls a meeting in the late 1990s in which Mr. Eichner handed him a book by Jerry Adler that chronicled the Times Square failure: "High Rise: How 1,000 Men and Women Worked Around the Clock for Five Years and Lost $200 Million Building a Skyscraper." Mr. Knobloch says he was astonished. "He handed me the book that talked about how he lost $200 million," he recalls. "To his prospective lender. I said to myself, 'This is not a man I'm going to work with.' He never saw me again."

Mr. Eichner says he doesn't recall meeting Mr. Knobloch. He concedes that some lenders likely blacklisted him. "The first couple of deals, I was under a microscope, and not surprisingly. There are people to this day who won't deal with Harry, won't deal with Donald, and won't deal with me."

Deutsche Bank's relationship with Mr. Eichner began tentatively. In 2000, Mr. Eichner needed a loan to build a condominium high-rise in Miami's South Beach. Deutsche Bank arranged for GMAC LLC to make the loan, with the bank promising to make GMAC whole if the project failed, according to two people familiar with the deal. The project, called the Continuum, sold well, GMAC's loan was paid on time, and Deutsche Bank earned a fee of close to $15 million. After that, Mr. Eichner says, "my stock was pretty high with the bank." A Deutsche Bank spokesman declined to comment.

Soaring Values By the middle of this decade, fueled by low-interest rates, easy credit and soaring values, commercial real estate was hot once again. Developers were building and selling at significant profits. And lenders were competing to make big loans that brought big fees. Charlotte, N.C.-based Wachovia Corp., for example, jumped from near the back of the pack in 2002 to take the lead in commercial lending by 2007, by combining attractive terms with aggressive marketing on loans of $50 million and up.

In 2003, Mr. Eichner began looking at a slim, eight-acre plot on the Las Vegas Strip, which he considered suitable for some kind of development. He had $10 million to invest. He lined up an additional $40 million in equity from Soros Fund Management, an investment group founded by George Soros, and approached Deutsche Bank for a $60 million loan to buy the land. The bank figured that with Soros money behind the deal, it was a relatively safe bet, according to a person knowledgeable about the bank's decision. It made the loan.

Before long, Mr. Eichner was aiming big: two 600-foot towers atop a casino, four floors of retail and five levels of underground parking. The project would be wedged between the Bellagio and MGM Grand's big new CityCenter project.

Mr. Eichner and his wife, Leslie, who advises him on interior design, began brainstorming. They hired Miami-based architect firm Arquitectonica to come up with an edgy design. Ms. Eichner envisioned some rooms with leopard-skin-patterned wallpaper and others with see-through glass around the bathtubs. "You can come here with your husband, with someone else's husband, whatever," says Mr. Eichner. (such integrity!)

For the retail space, they ordered up a pair of 28-foot industrial robots programmed to box, to dance to "Disco Inferno," and to play 12-foot Fender Stratocaster guitars. On the roof above the casino and stores, they planned a five-acre "beach" with sand, cabanas and a pool with artificial tides.

Mr. Eichner says condo buyers were enthusiastic about the plans, with buyers putting down nonrefundable deposits totaling nearly $280 million, representing almost $1.4 billion in sales.

But the bank declined to give Mr. Eichner more money unless he put a lot more cash into the deal -- either his own or money raised from investors, according to the person knowledgeable about the bank's approach.

By early this year, Deutsche Bank's loans for the project stood at $760 million. A spokesman for the bank declines to comment on whether any slices of the loan were sold off to other lenders.

On Jan. 15, unable to raise the equity needed to get a larger loan, Mr. Eichner defaulted. That in turn triggered defaults on his financing from Hyatt and Marathon. The project was only about one-third completed.

WHERE WAS THIS INTERVIEW PUBLISHED? eichner has a pair of cubes (not to sound too graphic) like no other i'm aware of. he tells us all basically how wealthy he is and what a grand lifestyle he can afford, while we owners just sit on the pile of manure he gives us. he sure is an in-your-face guy, and has a way of slipping through legal cracks almost like a magical illusion. got to admit, he's slyly amazing.............and a SOB to boot.

looking forward to schneiderman and the court to sealing those legal cracks and let eichner be shown as he really is: a wealthy, grand-living fraud.............hmm, any resemblance to mr madoff or whatever his name is? not quite the high stakes or the exact scheme involved, but nevertheless, one needn't look to far to note obvious similarities. hopw the court sees the issues this way.