Four months after a court ruled debtholders could foreclose on its Alex Hotel and Flatotel properties in Midtown, Alexico Group and its partners have filed for bankruptcy protection in connection with the two buildings, which have $368 million in liabilities, Bloomberg News reported (note: correction appended). The developer has $245 million of outstanding liabilities on the 272-room Flatotel at 135 West 52nd Street with lenders Rockpoint Group, Procaccianti Group and Atlas Capital Group. The partnership purchased the debt from Anglo Irish Bank two years ago.
Alexico owes an additional $123 million on the 205-room Alex Hotel at 205 East 45th Street, according to the Chapter 11 filing in Manhattan Bankruptcy Court.
The development firm led by Simon Elias and Izak Senbahar defaulted on the loans in 2009, but delayed the foreclosure process by arguing that it had simply reallocated the money to another property it owns, the Mark Hotel, which was permissible under an agreement with Anglo Irish. However, a judge ruled against them in January. [Bloomberg]