The Real Deal New York

Alex hotel faces $82M foreclosure suit

July 22, 2010 01:00PM
By David Jones

The Alex

The Alex, one of Alexico Group’s three distressed hotels in Manhattan,
is facing an $81.7 million foreclosure suit after Anglo Irish Bank sold
the note on the property earlier this month.

Manhattan-based Atlas Capital Group filed suit July
16 in New York State Supreme Court for a judgment on the property after
buying the defaulted note. The suit alleges that Alexico, led by Izak
Senbahar and Simon Elias, failed to make payments on the loan since
March 2009, resulting in a default on $74.9 million in loans.

The loan on the 205-room luxury hotel, at 205 East 45th Street, was one
of three notes on Alexico properties up for sale since early June,
according to Crain’s. There is no indication as to what happened with
the other two notes, at the Mark Hotel at 25 East 77th Street or the
Flatotel at 135 West 52nd Street.

Ben Thypin, senior market analyst at Real Capital Analytics, said the
lenders wanted to sell the notes as a group, but may have been forced
to sell the Alex note individually to get a deal done.

After opening in March 2004, the David Rockwell-designed Alex Hotel
emerged as an award-winning property and a member of the Leading Hotels
of the World, a marketing group for some of the world’s most luxurious
properties.

Lawyers for Atlas Capital are seeking a judgment against the developers
and have asked for a receiver to be appointed to operate the hotel,
according to the complaint.

Alexico and Atlas Capital Group officials, as well as lawyers for Anglo
Irish Bank, were not immediately available for comment. Lawyers for
Atlas Capital said they would have no comment beyond the complaint.

Atlas Capital filed a second lawsuit against Alexico, demanding that a
$10 million guarantee be enforced against the developers, according to
court documents.

The lawsuits are the latest in a slew of hotel problems
for Alexico. At least four buyers have moved to back out of their
contracts at the Mark, a hotel and condominium that reopened in January
following a $200 million renovation. The Wall Street Journal reported
that Alexico only paid back $20 million of the $255 million in loans
from Anglo Irish Bank backed by the Mark and scaled back the number of
units being offered for sale from 42 suites to 10 due to weak demand.

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