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NEW YORK CITY-One of the biggest recent deals in commercial real estate just went kaput. Tishman Speyer Properties is giving the Peter Cooper Village and Stuyvesant Town apartment complex back to its creditors. Tishman bought the sprawling multifamily complex for $5.4 billion in 2006, according to media reports.

The move follows Tishman and partner BlackRock's default on $4.4 billion in debt they took out to finance the acquisition. An article in the Wall, Street Journal estimates that the 56-building complex is only now worth $1.8 billion.

In a statement issued Monday, the joint venture of Tishman and BlackRock says it would not consider a long-term management contract to continue operating the property that does not involve ownership. "Without a restructuring that would keep our ownership group as part of the equity, we felt it best that the new owners install a new management team," according to the statement. "We are fully committed to an efficient transition of the property's operation and are offering to continue managing the property during this period to make the transition smooth and seamless for the residents."