Gramercy Completes Exchange of Remaining Subordinated Notes

Gramercy Capital Corp., New York, has redeemed $52.5 million of junior subordinated notes due June 30, 2035 issued by its operating partnership subsidiary. Gramercy completed the transaction by transferring to the noteholders an equivalent par value amount of various classes of bonds issued by affiliates Gramercy Real Estate CDO 2005-1, Gramercy Real Estate CDO 2006-1 and Gramercy Real Estate CDO 2007-1, which had been previously purchased by the company in the open market, and $5 million in cash equivalents. In October 2009, the company settled an exchange of $97.5 million of junior subordinated notes for an equivalent par amount of CDO bonds. This redemption eliminates Gramercy's junior subordinated notes from its consolidated financial statements, which had an original balance of $150 million.