O&Y building repossessed

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The Independent Online
THE PRUDENTIAL Insurance Company of America has taken possession of the 28-storey Aetna Canada Centre in Toronto, the first building to be transferred to a creditor under the restructuring plan for Olympia & York, the troubled property giant.

Prudential, which held a dollars 155m (pounds 102m) mortgage on the office tower, now owns and manages the building, having parted ways with O&Y and released it from any further liability.

Other secured creditors of O&Y may also move to take possession of buildings, although some are happy to retain O&Y as managers of the properties on which they hold mortgages. However, in a few months, the main tenant at the Aetna Canada Centre, Aetna Life, will be moving out of the building, leaving it 50 per cent vacant, and Prudential wants to press ahead with necessary repairs and a campaign to sign up new tenants.

'We will be able to focus exclusively on the one building,' commented Les Wittlin, a lawyer at Gowling, Strathy & Henderson in Toronto, acting for Prudential. He pointed out that O&Y still manages several other large buildings in downtown Toronto and would therefore not be able to devote its full attention to the Aetna Canada Centre.