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Bankruptcy: Magic Johnson-Funded NYC Condo Project

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With billions in development dollars, was this just one easier to write off? Yesterday, one of Magic Johnson's Canyon-Johnson Urban Fund-backed developments, a New York condo project, filed for bankruptcy. More via Reuters:

"In court documents filed Feb. 5 in U.S. Bankruptcy Court in the Eastern District of New York, the developer said the "unprecedented decline in the real estate market generally, and Williamsburg/Greenpoint specifically" led it to conclude condos were not the best use of the property. Canyon-Johnson Urban Fund -- a private real estate fund focused on urban properties whose investors include Johnson, who played for the Los Angeles Lakers National Basketball Association team -- has provided the development with $12.3 million in mezzanine financing. Mezzanine loans are backed by an interest in a property's operating company, rather than by the asset itself." It was last April that the Los Angeles-based Canyon-Johnson Urban Fund, a partnership between Johnson and Beverly Hills-based Canyon Capital Realty Advisors, announced that $4 billion in total development funds would help fund upcoming (but unnamed) developments around Los Angeles. The firm has funded behind projects such as Sunset + Vine, the former Transamerica Tower, as well as numerous developments across the country. Investors in Canyon-Johnson Urban Fund include the California Public Employees’ Retirement System, according to a 2008 LA Times article. A list of some of the projects can be seen here.
· Magic Johnson-funded NY condo developer seeks Ch.11 [Reuters]
· Magic Johnson Raises $1 Billion For Urban Projects [Curbed LA]
· Canyon Johnson Fund [Official Site]