Robert Valentine Tishman (April 7, 1916 – October 11, 2010) was an American real estate developer who had been head of the family-owned firm Tishman Realty and Construction until it was disestablished in 1977, and was one of the two founding partners of Tishman Speyer, which was formed in 1978 and became one of the largest owners and builders of office buildings in the United States.

Career
After completing his military service, he went back to work with the family business. During the 1960s and 1970s, Tishman was president and chief executive officer of Tishman Realty and Construction, where he oversaw building projects that included Madison Square Garden, the World Trade Center and the Tishman Building at 666 Fifth Avenue. Expanding outside of New York City, the firm's projects included the Century Plaza Towers in Los Angeles commissioned by Alcoa, the John Hancock Center in Chicago and Detroit's Renaissance Center. In a 1968 interview with Business Week magazine, Tishman described the company as "an intercompany conglomerate" that could identify building sites and help in all phases of design, financing and construction, offering "capabilities that no other owner-builder or general contractor matches".

The original firm was liquidated in 1977, and he established Tishman Speyer the following year together with his son-in-law Jerry Speyer, as the firm's founding chairman. The firm went on to develop more than 300 building projects around the world, including the Torre Norte skyscraper in São Paulo, Brazil, as well as the Equitable Center on Seventh Avenue in New York and the Sony Center at Potsdamer Platz in Berlin. Included in the 166,000,000 square feet (15,400,000 m²) of commercial property owned and managed by the firm are the landmark properties in New York, the Chrysler Building and Rockefeller Center.^[3] At the time of his death, Tishman Speyer was working as construction manager of a building at 510 Madison Avenue and was project manager of One World Trade Center, the building formerly known as the Freedom Tower that will become the tallest structure in the city upon its completion.^[7] In his obituary in The New York Times, Speyer recounted how Tishman would come to work each day in the firm's offices until two years before his death.

Tishman served as Chairman of the Real Estate Board of New York from 1966 to 1979, having been a member of the organization for 52 years. He was Chairman, and then Honorary Chairman, of Montefiore Medical Center in the Bronx, Associate Chairman and Charter Trustee of the Jewish Association for Services for the Aged, Trustee of the Citizens Budget Commission, a member of the Real Estate Advisory Committee of Cornell University, a member of the Board of Directors of Boys and Girls Harbor, Director of the Citizen's Housing and Planning Council, and was an Honorary Director of the Grand Street Settlement.

Tishman Venture Gives Up Stuyvesant Project

High-Profile Purchase of Manhattan Complex Collapses Under Debt Mountain

A group led by Tishman Speyer Properties has decided to give up the sprawling Peter Cooper Village and Stuyvesant Town apartment complex in Manhattan to its creditors in the collapse of one of the most high-profile deals of the real-estate boom.

The decision comes after the venture between Tishman and BlackRock Inc. BLK +1.37%BlackRock Inc.U.S.: NYSE ^$307.60 +4.16+1.37% Nov. 27, 2013 4:01 pm Volume (Delayed 15m) : 420,757AFTER HOURS ^$306.87 -0.73-0.24% Nov. 27, 2013 4:39 pm Volume (Delayed 15m): 700 P/E Ratio 18.89Market Cap $51.40 Billion Dividend Yield 2.18% Rev. per Employee $969,42911/26/13 BlackRock: Taper Won't Derail ...11/20/13 Bond Investors Could Pay for P...11/17/13 Treasury Arm Gets Earful From ...More quote details and news »BLK inYour ValueYour Change Short position defaulted on the $4.4 billion debt used to help finance the deal. The venture acquired the 56-building, 11,000-unit property for $5.4 billion in 2006—the most ever paid for a single residential property in the U.S. The venture had been struggling for months to restructure the debt but capitulated facing a massive debt load and a weak New York City economy that has undercut rents and demand for high-priced apartments.
 

Tishman Speyer's deal for Stuyvesant Town and Peter Cooper Village, which was the biggest real estate deal at the time, may end up in bankruptcy, the News Hub panel reports.

The property's owners signaled they would be unable to reach a deal with lenders and instead decided to allow creditors to proceed with what amounts to an orderly deed-in-lieu of foreclosure, which means a borrower voluntarily gives the property back to lenders to avoid a foreclosure proceeding.

"It has become clear to us through this process that the only viable alternative to bankruptcy would be to transfer control and operation of the property, in an orderly manner, to the lenders and their representatives," the venture said in a statement to The Wall Street Journal. "We make this decision as we feel a battle over the property or a contested bankruptcy proceeding is not in the long-term interest of the property, its residents, our partnership or the city."

The troubles at Stuyvesant Town reflect the dismal condition of the apartment market throughout the country as high unemployment hammers rents and occupancy levels. Hardest-hit are highly leveraged deals done by private companies that, unlike large public real-estate companies, have been closed out of the capital markets.

Stuyvesant Town creditors weren't immediately available for comment. But pressure on the Tishman group has mounted in recent weeks as some of the property's creditors have threatened to foreclose. In a letter sent to Tishman last week, a group including Concord Capital, an affiliate of Winthrop Realty Trust, FUR +1.84%Winthrop Realty TrustU.S.: NYSE ^$11.65 +0.21+1.84% Nov. 27, 2013 4:00 pm Volume (Delayed 15m) : 91,860AFTER HOURS ^$11.65 0.000.00% Nov. 27, 2013 4:00 pm Volume (Delayed 15m): 1,900 P/E Ratio 40.71Market Cap $424.15 Million Dividend Yield 5.58% Rev. per Employee N/A said it intends to pursue "its rights and remedies," including possibly moving to foreclose on the property within 90 to 180 days.

By some accounts, Stuyvesant Town is only valued at $1.8 billion now, less than half the purchase price. By that measure, all the equity investors—including the California Public Employees' Retirement System, a Florida pension fund and the Church of England—and many of the debtholders, including Government of Singapore Investment Corp., or GIC, and Hartford Financial Services Group, HIG +1.35%Hartford Financial Services Group Inc.U.S.: NYSE ^$36.05 +0.48+1.35% Nov. 27, 2013 4:00 pm Volume (Delayed 15m) : 5.06MAFTER HOURS ^$36.05 0.000.00% Nov. 27, 2013 6:43 pm Volume (Delayed 15m): 70,055 P/E Ratio N/AMarket Cap $16.12 Billion Dividend Yield 1.66% Rev. per Employee $1,173,4700 are in danger of seeing most, if not all, of their investments wiped out.

The Tishman venture's decision to hand back the keys represents a defeat for a company that for years represented the gold standard of commercial real-estate deals, reaping high returns for investors.

It does not take a financial genius to know from the get-go that it was a huge bad investment for Tishman and others. Then again, back then, money was growing on trees.

—Phillip Hwee

Tishman Speyer has invested in such trophy assets as Rockefeller Center and the Chrysler Building, and its founder, Jerry Speyer, has been a major player in both real-estate and political circles for years. His son Rob Speyer is being groomed to take over the family real-estate empire.

The Stuyvesant Town deal is one of several Tishman Speyer did at the top of the market that the company is trying to save. But the company itself isn't threatened. It took advantage of easy credit and investors' eagerness to buy into real estate during the good times. As a result, it didn't put much of its own cash into deals.

Of the $5.4 billion price tag on the Stuyvesant property, Tishman invested only $112 million of its own money, with about $56 million from Jerry Speyer and Rob Speyer, co-chief executives of the New York-based company.

Tishman has earned more than $10 million in property-management fees since the Stuyvesant Town acquisition, according to analysts at Deutsche Bank AG. Tishman decided to waive certain fees last year and managed the property for a loss, according to a person familiar with the matter.

Tishman Speyer "would not consider a long-term management contract to continue operating the property that does not involve ownership," the partnership said in the statement. "Without a restructuring that would keep our ownership group as part of the equity, we felt it best that the new owners install a new management team."

The Tishman venture's acquisition of Stuyvesant Town was controversial in New York. The Stuyvesant Town complex was developed by MetLife for returning World War II veterans and remained a middle-class haven even as rents in other parts of the city soared. Tishman's plans were to raise the rents for hundreds of the units to market rates.

More on Stuyvesant Town

• Developments: Tishman's 'Strategic Default'

• Court Rules Against Tishman in Stuyvesant Town, (10/23/2009)

• An Apartment Complex Teeters, (10/15/2009)

But the strategy backfired because of a slowing New York economy, a heavy debt load and a court ruling hindering the owners' ability to convert rent-controlled units to market rentals. In January, the property depleted what was left in reserve funds and defaulted on its first mortgage.
 

Stuyvesant Town was developed by MetLife for returning World War II veterans. Tishman planned to raise rents for many units to market rates. Bloomberg News

Nationwide, scores of other apartment deals also are tanking as landlords are being forced to cut rents and offer incentives like flat-screen TVs to attract and retain tenants. San Francisco's Lembi family, the biggest apartment owner in that city, has been forced to give up numerous apartment properties to its lenders because it couldn't repay debt.

Investors who purchased commercial-mortgage-backed securities, or CMBS, also are facing losses. In December, more multifamily CMBS loans moved into delinquency than for any other property type, with 113 new loans, totaling $1.1 billion, becoming delinquent, according to Moody's Investors Service.

The Stuyvesant Town collapse comes amid mounting woes in the market for retail stores, hotels, apartments and other commercial property. Mall-giant General Growth Properties and hotel-chain Extended Stay Inc. filed for bankruptcy-court protection last year, and more commercial-property projects could fail amid an inability to repay debt because of dwindling rent rolls and still-scarce financing for all but large real-estate investment trusts.

The troubles experienced by landlords nationwide are stoking fears among regulators and bankers that turmoil in commercial real-estate may derail the hoped-for economic recovery.

Research firm Foresight Analytics estimates delinquencies on commercial real-estate loans held by banks will rise to 9.47% in the fourth quarter, up from 5.49% a year earlier.

Meanwhile, the delinquency rate on CMBS stood at 4.9% in December, according to Moody's, up five-fold in just a year.