Market Tower target of $60M foreclosure filing

Scott Olson
December 11, 2013
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A California bank is suing the owner of one of the city’s largest office towers, claiming it failed to pay off the $60 million balance on its mortgage.

Union Bank filed suit Dec. 2 against MT Acquisitions LLC, an affiliate of Indianapolis-based HDG Mansur, which owns the 30-story Market Tower downtown at 10 W. Market Street. HDG Mansur last month closed on a sale of the Illinois Building, located directly across the street from the tower, to a subsidiary of local developer Keystone Realty Group.

The bank’s complaint, pending in Marion Superior Court, seeks a court-appointed receiver to manage the building during the foreclosure process.

Union Bank says in court filings that MT Acquisitions borrowed $52.5 million from PB Capital Corp. in 2004. In 2007, the company borrowed an additional $12.5 million, pushing the total amount of the loan to $65 million, according to the documents.

In June this year, Union Bank acquired the assets of PB Realty, a subsidiary of PB Capital, and subsequently filed to foreclose on Market Tower. The bank alleges in the suit that the principal on MT Acquisitions’ loan came due in November 2012.

The possibility of foreclosure isn’t the only problem HDG Mansur is facing at Market Tower, however.

Cassidy Turley, which leases and manages the building, and another brokerage, CBRE Inc., have filed liens against MT Acquisitions totaling about $2 million, further suggesting that HDG Mansur may be in financial trouble.

HDG Mansur did not return phone calls seeking comment on the foreclosure and lien filings.

Cassidy Turley’s two liens, one for $722,201 and another for $288,063, are for property management fees and commissions, respectively. CBRE’s lien of $958,531 is for commissions only. In the commercial real estate business, the owner of a building typically pays all commissions involving a tenant lease deal.

CBRE’s fee relates to work it did to help law firm Bingham Greenebaum Doll LLP re-sign a lease earlier this year in Market Tower, said John Merrill, managing director of the local CBRE office.

“It’s one of the top-five buildings in the market,” he said, “so it’s disappointing to hear that that’s happening to an asset of that quality.”

HDG Mansur President Harold Garrison and former business partner Lee Alig developed Market Tower in the 1980s at a cost of $92 million. It ranks as the city’s sixth-largest downtown office building, according to IBJ statistics, with roughly 517,500 square feet of rentable space. It's also the fourth tallest building downtown, at 421 feet.

Market Tower has 130,000 square feet of available space, according to CoStar Group Inc., putting occupancy at about 75 percent. Bingham gave up one of its six floors when it renewed its lease, adding more vacancy to the building.

HDG Mansur’s office is located on the 12th floor of Market Tower.

Local real estate sources said the firm had been trying to refinance the loan on the building for some time.

“It’s got a great location, great architecture, great views,” said Jeff Harris, managing director of NAI Meridian. “The issue that everyone has downtown is that there is more supply than there is demand.”

Downtown’s vacancy rate has hovered around 20 percent for years.

Union Bank is represented by New York lawyer William Weisner. He didn’t return a phone call seeking comment on the foreclosure filing.

The foreclosure is the second one to hit HDG Mansur within the past two months. In October, HGCC Lender LLC filed a $4.8 million suit and asked a Hamilton County court to appoint a receiver to manage the Hawthorns Golf & Country Club at Hamilton Proper.

HDG Mansur is the developer of Hamilton Proper, an 850-acre golf community launched in Fishers in 1988. Hawthorns is owned by a separate group of investors, some of them local. However, HDG Mansur and Garrison personally are among the defendants in the suit because they are guarantors on the loan.

HDG also is entangled in a nasty court battle in New York with a former client that accused it of misappropriating funds. In August, a judge issued a $5.8 million judgment against the developer but put collection on hold as he considers some $20 million in counterclaims brought by HDG Mansur.


  • Karma is B part two
    Looks like that was standard operating procedure "Former Service Provider". We live in Hamilton Proper and his business practices were much the same here. They over-billed the HOA for services, failed to pay thousands in dues for lots, and when the money was tight sold out to apartment developers. He can't fly off to Florida permanently fast enough for us
  • "Karma is a B"
    or "what goes around comes around" or whatever cliche' you want to use, HDG Mansur and Harold Garrison are finally getting what they deserve for the way they treated their suppliers/service providers/employees over the years. We are a family owned construction company located here in Indy, who did work for Mansur before the Alig and Garrison split, and then both Mansur and HDG Mansur after the split, who finally had to stop doing work for anything Mansur related because of the constant short pays, arm twisting, all done based on promises of future work. We often had to take pennies on the dollar after a project didn't work out because of their poor management. It will be interesting to see if HDG Mansur can survive these foreclosures, unfortunately I would guess that the executives of the Company have their money sheltered and won't be touched like they have affected others.

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