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Last of Okun Empire Will End in Foreclosure

Mall Properties Could Revert Back to Wachovia
January 28, 2009
Gerard A. McHale, Jr., the Chapter 11 bankruptcy Trustee for The 1031 Tax Group, has given up the effort to sell indicted Miami developer Edward H. Okun's last remaining real estate assets. That decision clears the way for the foreclosure of the properties.

McHale was charged with selling off Okun's assets from his finance and real estate empire that collapsed into numerous bankruptcy actions in the summer of 2007.

The last remaining parcels in the Okun portfolio are the 587,512-square-foot regional mall Salina Central Mall in Salina, KS, and the JC Penny's building in Houston, TX, contiguous to the West Oaks Mall property.

For the Salina property, Okun paid more than $40 million, but McHale was unsuccessful in finding a buyer who would even pay the amount of the mortgage ($32.745 million).

Hence McHale has agreed not to fight a foreclosure on the property by the lender, Wachovia.

The same applies for the JC Penny's building which has been vacant for a number of years now. Okun had originally purchased the property for $4 million and obtained financing from Wachovia of $3 million.

This story is excerpted from Watch List. You can download all of the Watch List stories and properties plus all of this weeks Closures & Layoffs in Adobe pdf format here. Plus you get bonus news items not found in these columns or the CoStar Group web news pages.

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