Creditors of New City Residence Investment Corp (NCRI)., Japan's first failed real estate investment trust, rejected Lone Star Fund's rehabilitation plan. The plan attracted just 31% of the voters at a creditors meeting, failing to secure the majority support needed for approval. Creditors are said to be unhappy with the plan, which proposed to repay them only after five years. NCRI, one of the biggest residential REITS in Japan, filed for a court-protection business rehabilitation in October. Lone Star was the winning bidder for NCRI this year.
NCRI will reconvene a creditors meeting on September 9, by which time it must convince creditors to back a revised Lone Star proposal, find a new sponsor, or face bankruptcy. In terms of new sponsors, Blife Investment Corp and Daiwa House Industry Co. are stepping forward.
July 16, 2009
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