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October 6, 2011

Detroit’s Riverfront Towers Rescued?

By Veronica Grecu, Associate Editor

One week after the Federal National Mortgage Association—better known as Fannie Mae—sued the Riverfront Towers’ owners over an alleged $70 million debt on the loan, plus fees, US District Judge Avern Cohn appointed Ronald Glass of GlassRatner Management and Realty Advisors LLC as receiver to find a buyer for the apartment community. A request for a preliminary injunction on the property transfer or collected rents was approved during the same hearing.

Detroit Riverfront TowersAccording to The Detroit News, the placement of injunction is meant to protect Fannie Mae’s interest in the residential towers, prevent the hiding of income and any decrease in the property’s value. Under the new arrangements, the property’s owners must give up the rent paid by tenants and hand all lease records, receivables and delinquency reports to the appointed receiver. Ronald Glass, who will be paid $10,000 a month plus expenses, will be in charge of collecting rents—ranging from $809 for a one-bedroom unit to $2,779 for a two-bedroom—and revenue generated by the Riverfront Towers; he has also been granted the authority to retain, hire and fire employees.

In other commercial real estate news, the Macomb County executive office located in the Mt. Clemens administration building is being renovated with the help of some in-house skilled tradespeople to keep expenses to a minimum. Deputy Executive Mark Deldin told the Detroit Free Press that the renovation costs are yet to be determined but they will be included in next year’s annual audit report. The work is expected to be done by January or February 2012; the improvements include painting, carpeting and replacing some walls at the eighth floor, where the county’s executive office will relocate.

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