'Blood in the Water' Surrounds Elusive Macklowe

Where’s Harry Macklowe?

Has the once mighty real estate titan taken a wind-powered voyage on his sailboat, Unfurled, to some mysterious locale still untouched by rumors of his catastrophic fall from the acme of Manhattan real estate?

More likely, he’s in a well-appointed office in one of his manifold trophy buildings, hammering out some sort of ingenious deal to save himself from his $7 billion worth of debt, and to retain some stake in his beloved of beloveds, the GM Building.

Filtering through the layers of speculation surrounding Mr. Macklowe is akin to finding Waldo in his red-and-white-striped cartoon universe. Especially since the developer has kept his dealings close beneath his (metaphorical) red-and-white-striped hat.

“No update,” said his spokesman, Steve Solomon.

Of course, that hasn’t kept real estate types from speculating. As the saying goes, nature abhors a vacuum.

“At every meeting I attend, we start the discussion by talking about Macklowe,” said Eric Michael Anton, the executive managing director of Eastern Consolidated. “Everyone’s talking about it all day long. But I’m amazed by how little is spilling out.”

Just remember, a mere four months ago, real estate types were fixated on the marketing of Mr. Macklowe’s prized GM Building—the striped marble trophy at 767 Fifth Avenue that he bought in 2003 for what was then an astonishing $1.4 billion. Last year, in what was at the time considered a brilliant move, Mr. Macklowe used the GM Building as collateral in his $7 billion purchase of the seven-tower Equity Office Portfolio, which includes Worldwide Plaza at 825 Eighth Avenue; 1301 Avenue of the Americas; Park Avenue Tower at 65 East 55th Street; 527 Madison Avenue; 1540 Broadway; 850 Third Avenue; and Tower 56 at 126 East 56th Street.

But then Mr. Macklowe got sideswiped by that cursed credit crisis. He wasn’t able to get an equity partner or refinancing to help repay his lenders.

A source familiar with the negotiations set the stage for us:

“In the face of a market that is crumbling, Macklowe is visibly under duress, because he’s in the papers all the time and the banks will wipe him out. There is blood in the water.” Next Page >