Bloomberg reported that the 461,000-square-foot office property, which Mascklowe bought in December 2006 for $498 million, is being auctioned by Eastdil Secured on Wednesday. The action stems from a default on a $130-million mezzanine loan held by Cadim, a unit of a Canadian-government-owned pension fund, Caisse de Depot et placement du Quebec, published reports say. Macklowe also obtained a $240-million senior mortgage from Deutsche Bank for the property.

Dan Fasulo, managing director at Real Capital Analytics, tells GlobeSt.com the fate of 1330 Sixth Ave. will hardly be an isolated incident. "There will be many more like this," he warns, noting that the Sixth Avenue property represents "the same situation as [the] Hancock Tower in Boston." Fasulo was referring to the March 31 sale of Broadway Partners' John Hancock Tower to Normandy Real Estate Partners and Five Mile Capital Partners. Ironically, Broadway's $3.3-billion acquisition of the Hancock Tower and nine other office properties closed on the same day as Macklowe's acquisition of 1330 Sixth.

A few weeks after the acquisition of 1330 Sixth, Macklowe acquired eight of the nine buildings in Equity Office Properties' Manhattan portfolio for $7 billion. The buyer put in only $50 million of its own money, and the deal has come to be seen as a symbol of the highly-leveraged deals that proliferated at the height of the current market.