Tishman Speyer Properties and BlackRock Realty, the owners of Manhattan’s Stuyvesant Town- Peter Cooper Village, moved closer to restructuring $3bn in debt on the apartment complex as the property verges on default, Fitch Ratings said.

The companies turned the loan over to mortgage servicer CW Capital on 6 Nov, Fitch said in a statement. Fitch said the property doesn’t produce enough income to pay the debt and a reserve fund probably will be depleted by year-end. A sale is more likely than a restructuring because the complex has lost so much value, said Kevin O’Shea, managing partner and head of the real estate practice at the law firm Allen & Overy.