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February 16, 2009
Gramercy Capital's Further Downside Risks
Seeking Alpha
Though Gramercy Capital's extension of its $177 million loan to Forest City Ratner was billed in the press as a reprieve for the project, maybe, just maybe, the lender's finances are nearly as screwed up as Ratner's and it didn't have much choice.
Gramercy Capital (GKK) is a REIT that specializes in mortgage and real estate loans. A slew of REITs have been reporting in the last two weeks, and several have mentioned outstanding loans and joint ventures with Gramercy. Gramercy has given some of them extensions on their loans, but it doesn't appear to be from a position of strength.
Like Forest City, Gramercy's shares are in the toilet too:
Shares have been in a downtrend since May 2008 when they were still trading around $20. GKK closed at $1.05 on Friday; there could be more downside to go.
In the meantime, GKK investors are writing down their stakes. Seeking Alpha listens in on a couple conference calls where GKK is cast as "a lender in trouble."
Posted by lumi at February 16, 2009 4:46 AM