Conseco, Inc. and NYC developer Donald J. Trump announced that they have reached an agreement on a long-standing dispute over control and distribution of profits at the General Motors Building located on Fifth Avenue, which provides that the property will be put up for sale.
Trump and Conseco purchased the building in 1998 for $878 million, $211 million from Conseco, $11 million from Trump, and the assumption of the existing mortgage, originally around $700 million. A recent arbitration ruling ordered Trump to sell his 50 percent interest to Conseco for $15.6 million. Last Thursday a New York Court affirmed the panel’s decision and Trump had indicated he would appeal, but apparently decided to negotiate instead.
The parties’ announcement said, “the terms of the division of proceeds are confidential.”
Conseco President and CEO Bill Shea stated, “This agreement is very good news for Conseco. We are pleased that we’ve been able to resolve our remaining differences with the Trump organization and avoid delays in monetizing the value of our investment. The building will be put up for sale immediately to permit Conseco to put the substantial value of this investment to work toward our restructuring program.”
Donald Trump commented, “The General Motors Building is a great asset and has been a wonderful investment for the Trump Organization. I am happy that it has worked out so well for all concerned, and I wish Conseco well.”
Conseco indicated it would use the proceeds from the sale of the property to mainly to increase reserves required by state regulators, and to fund its ongoing restructuring efforts.
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