Hancock owner poised to fight any takeover try: report

The John Hancock Center, 875 N. Michigan Ave. Photo from CoStar Group Inc.

(Crain's) — A fund of Goldman Sachs Group Inc. will battle lenders on the John Hancock Center instead of relinquishing the tower, according to a report.

Goldman and Chicago-based Golub & Co. are obligated to pay back about $400 million in debt next week on the Michigan Avenue building, but a default is probable because the partners have not succeeded in selling or refinancing for that much, the Wall Street Journal reported.

The Whitehall fund of Goldman Sachs asked for an extension and is readying to fight in court any attempts to get control of the Hancock, 875 N. Michigan Ave., the Journal reported, citing a letter from the fund's lawyer that the Journal reviewed.

Some junior creditors have interfered with a plan to sell off the building in five segments, according to the letter, which says the proposal "would have enabled the borrowers to repay the loans in full well before the stated maturity and to earn a meaningful profit," according to the Journal report.

The fund thinks selling the Hancock separately — retail, office, the broadcast tower, the observation deck and the garage — would bring more than $400 million, the Journal reported. The lawyer's letter claims the idea in 2007 "received conditional approval" from the servicer when the debt was made into commercial mortgage-backed securities, according to the report.

The junior creditors are Chicago-based John Buck Co., a real estate fund of Morgan Stanley and NorthStar Realty Finance, according to the Journal, which said they declined to comment or did not respond to requests.

Investors including Blackstone Group are mulling buying a $98 million chunk of debt that the Morgan Stanley fund and Buck hold, the Journal reported, citing unnamed sources.