The Fed and the state of New York gave AIG an $85-billion secured revolving credit loan on Sept. 17 to help buttress the reinsurer from its mounting debt. AIG had accrued a debt of $75 billion. The company has now reportedly begun to sell off some of its assets to repay the two-year loan (which the government, through a taking of company stock, stands to profit if repaid).
Inland Development formed a $200 million joint venture in the summer of 2006 with AIG Global Real Estate, the real estate investment arm of AIG. At the time, Anthony Casaccio, president of Inland Development, said the venture would expand his company's reach across the country, thanks to AIG's strength.
The spokesman said the JV has been used so far to purchase more than 1,500 acres of unimproved land throughout the Chicago region. The land was planned to be used by the companies for residential development. The JV was designed to hike development throughout the Chicago area, northern Indiana, southern Wisconsin and southwest Michigan. "Of the $200 million, approximately $100 million of that has been invested in 10 Chicagoland properties," the Inland spokesman tells GlobeSt.com. "In terms of going forward, current economic conditions have slowed new acquisitions, but we're evaluating all opportunities on an ongoing basis."
Elsewhere in the country, the effect of AIG's takeover raised questions about other AIG assets. The company will reportedly sell its half-stake in the London City Airport. In Atlanta, a 138-acre mixed-use development called Atlantic station is a product of another AIG joint venture, nearly a decade in the making. There, the insurer partnered with Atlanta-based developer Jacoby Development Inc. to create six million sf of class A office space, two million sf of retail and entertainment, 5,000 residences and 1,000 hotel rooms. AIG and the brokers who work on the various aspects of Atlantic Station have told GlobeSt.com that this venture is also not at risk in light of the company's recent difficulties.
The spokesman said, despite AIG's selloff attempts, its acquisitions with Inland Development will remain intact. The rest of the money remains available for acquisitions of new assets as opportunities arise, the spokesman said. AIG reps did not return calls for comment.
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