Boston's John Hancock Tower, New England's tallest building, was sold Tuesday in a foreclosure auction held by an investor group for $660.6m, half the price paid by real-estate private-equity firm Broadway Partners three years ago.
The winning bidder was a partnership between Normandy Real Estate Partners and Five Mile Capital Partners, which holds the senior portion of $700m in so-called mezzanine debt, or the part that fills the gap between the first mortgage and a borrower's equity. The partnership agreed to pay $20.1m for the mezzanine debt and assume the first mortgage of $640.5m. The Normandy-Five Mile team has bought pieces of the mezzanine debt at discounted prices since June 2008. The debt was originally made by Greenwich Capital, which is part of Royal Bank of Scotland Group, and Lehman Brothers Holdings Inc.
Wall Street Journal