Frank Gehry laid off more than two dozen staffers in late November after client Forest City Ratner ordered the architect to put down his pencils on the $4 billion Atlantic Yards project, according to people familiar with the matter. A Gehry Partners LLP spokeswoman declined to comment.

A Forest City spokesman declined to comment and pointed to a previous statement that said work on the Brooklyn, N.Y., project was delayed because of legal challenges. Forest City has said it is committed to the 22-acre site, slated to be anchored by a basketball arena plus residential and office skyscrapers.

Forest City Ratner's parent, Forest City Enterprises Inc., said last week that it has cut off its new development pipeline, except for Atlantic Yards. But the project faces challenges given the recession and the financial markets. A $153 million land loan from Gramercy Capital Corp. that has accrued to $177 million, is due at the beginning of February. Forest City is in talks with Gramercy to extend the loan.

Taking Office in Washington

Most of the deals getting done these days are ones where the buyer can take over an existing mortgage, obviating the need to find new financing.

Take, for example, a portfolio of eight suburban Washington office buildings that just traded hands. Asset Capital Corp. sold the block of buildings with 650,000 square feet to Creaney & Smith Group for $75 million. The blended cap rate is around 10.5%, according to people familiar with the deal. That is around two percentage points higher than it would have sold in the boom years.

The deal wasn't easy to get done. Asset Capital marketed the properties a year ago and found a buyer, but that deal fell through. Creaney & Smith came along and inked a contract in early summer. But then came negotiations with the eight lenders who had to sign off on the deal. The buyer had to post additional reserves to cover cash-flow decreases from potential vacancies. That lowered the loan-to-value ratio on the deal from around 78% to about 75%.

Collins Ege, of Jones Lang LaSalle, brokered the deal.

Miami River Condos

Riverfront, a cluster of condo towers along the Miami River that is envisioned as an affordable rival to more luxurious parts of the city, is off to an inauspicious start.

Wachovia Corp. has filed for foreclosure against the first building to open, the 489-unit Wind tower owned by Neo LLC. The construction loan came due in April, according to a lawsuit filed in Circuit Court in Miami-Dade County. But two forbearance agreements and a takeover by Wells Fargo & Co. later, Wachovia declared a default on $46.6 million in unpaid principal, plus interest and other fees.

Neo Chief Executive Lissette Calderon said her company is cooperating with Wachovia. More than 40% of the building's units had closed when the foreclosure was filed; 19 have closed since then, she said.

—Alex Frangos and Jonathan Karp

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