The Real Deal New York

Nassi faces foreclosure suit at 315 Park Avenue S.

Outstanding balance of $219M personally guaranteed by developer

August 01, 2012 11:00AM
By Katherine Clarke

From left: Craig Nassi and 315 Park Avenue South

Special servicer CW Capital has filed suit to foreclose on a 356,000-square-foot pre-war office tower at 315 Park Avenue South owned by BCN Development’s Craig Nassi, according to Supreme Court records filed late last week.

Nassi, who bought the building for $265 million in 2007, is delinquent on a securitized loan of more than $200 million, according to the complaint, filed by attorney Edward Smith and Rishi Kapoor of the law firm Venable. His company was originally issued the loan in June 2007 by UBS Real Estate Securities but the debt has since been reassigned several times, first to LaSalle Bank National Association, later to Bank of America once it merged with LaSalle and finally to U.S. Bank National Association in February 2012. The Venable attorneys were not immediately available for comment.

The total outstanding balance on the note and mortgage, which were personally guaranteed by Nassi according to court filings, is $219 million. Another $1.7 million is owed in interest at a rate of 5.82 percent plus $1.46 million in interest has accrued since the loan entered default.

The servicer’s move to foreclose on the loan comes just more than a year after Nassi tapped the Carlton Group to market the building to potential buyers or to a joint venture partner to recapitalize for approximately $350 million.

“Over the last three weeks, I’ve been getting a lot of calls from Asian groups and Middle East groups that want to buy the building or invest with me,” Nassi told the New York Post in May 2011. “I realized it’s time to hire an outside group to field the offers.”

When The Real Deal contacted Nassi about the foreclosure filing, he declined to comment, saying it was too premature to talk about the property. It was not immediately clear if he had found a partner or a way to restructure the debt.

The loan, which officially came due on June 9, is the sixth largest commercial loan slated to mature in New York City this year, according to data collected by the New York Times.

The top three loans that have matured or are maturing in 2012, according to their total unpaid balance, include a $400 million loan at 9 West 57th Street. Developer Sheldon Solow refinanced the building in December with a $625 million loan from Deutsche Bank AG; the loan was slated to mature in February. The second biggest maturity this year is a $310 million loan on 450 Lexington Avenue, which was scheduled to mature this month and is currently non-performing beyond maturity, according to data from analytics firm Trepp. However, Scott Rechler’s RXR Realty entered an agreement to purchase the tower from owner Istithmar last month and will likely restructure the debt on the property. Vornado Realty Trust also managed to refinance the building with this year’s third largest maturing debt – Manhattan Mall at 100 West 33rd Street. The REIT refinanced the property for $325 million in March.

Nassi’s Park Avenue South building is currently fully occupied, with banking giant Credit Suisse leasing almost 70 percent of the space at approximately $50 per square foot, according to previous reports. The company’s lease is valid through 2017.

  • REman1

    Personal guarantee??? common

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