From left: Hotelier Ian Schrager, Aby Rosen and Michael Fuchs of RFR Holding and the Gramercy Park Hotel

The bad blood simmering at the Gramercy Park Hotel is apparently heating up again, as Ian Schrager’s firm has filed a lawsuit against former investment partners Aby Rosen and Michael Fuchs alleging they failed to pay him back on a relatively small $1.15 million loan.

The suit, filed in New York state Supreme Court, alleges that Rosen and Fuchs, who are partners in Manhattan-based RFR Realty and owned 50 percent of the hotel in a high-profile partnership with Schrager, borrowed the money in December 2010 and was not repaid by the due date of Dec. 20 of last year. [more]

The U.S. real estate arm of international investment firm Investcorp has purchased the mezzanine debt on the Paramount Hotel at 245 West 46th Street from San Francisco-based Fillmore Capital Partners, GlobeSt.com reported. The debt includes two existing mezzanine loans with a principal balance of $40 million.

Aby Rosen and Michael Fuchs’ RFR Holding bought the Paramount Hotel for $275 million from Walton Street Capital and Highgate Holdings earlier this year.

“We’re pleased to have had a chance to provide financing for a transaction involving one of New York City’s most renowned hotels, and one that is in a particularly attractive location,” Christopher Hoeffel, a managing director at Investcorp, in a statement. [more]

Ian Schrager and the Clock Tower at 5 Madison AvenueHotelier Ian Schrager appears to be returning to the Clock Tower at 5 Madison Avenue.

According to Real Estate Weekly, Marriott International purchased the 220,000-square-foot office tower overlooking Madison Square Park from Africa Israel and plans to turn it into an Edition Hotel, the boutique hotel line it launched with Schrager. Africa Israel was previously reported to have sold the tower for $165 million, but the buyer was only identified as “a credit-worthy” one.

Though Marriott typically does not own its real estate, the hotel operator wants to buy property for its struggling Edition line, which it hopes will compete with Starwood’s W Hotel brand, to help get it off the ground [more]

From left: RFR Holdings’ Aby Rosen, Blackstone Group’s Stephen Schwarzman, architect Richard Meier and a Core Club suite

In 2005, RFR Holdings head Aby Rosen gave Jennie Saunders the first six floors of the condominium he was building at 60 East 55th Street to house her club for the rich and famous.

As a recent profile in Departures magazine highlighted, the club, known as Core Club, has become a haven for New York elites from all industries, including Blackstone Group President Stephen Schwarzman, architect Richard Meier, football legend Dan Marino and Hollywood talent agent Ari Emanuel. Many of those same people were among the 150 people who invested $100,000 to get Core Club off the ground.
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From left: Aby Rosen and Michael Fuchs of RFR Holding

Aby Rosen and Michael Fuchs’ RFR Holding is marketing a development site between West 44th and West 43rd streets, Crain’s reported, which could accommodate construction of a building as big as 355,000 square feet.

Sources told Crain’s that the site, on which there are currently three buildings, could command a hefty price tag — $500 per buildable square foot, going by a recent $400-a-square-foot asking price of a nearby site: a 12,000-square-foot plot at 20 West 40th Street, across from Bryant Park. Jones Lang LaSalle Capital Markets Group brokers are marketing the site.

Meanwhile, RFR is still trying to sell a 59 percent stake in the Seagram building at 375 Park Avenue. Sources told Crain’s that investors have been balking at the $700 million price tag for the Seagram building stake. [Crain's] [more]

From top: Aby Rosen, Michael Fuchs and the Seagram BuildingAby Rosen and Michael Fuchs, partners at RFR Holdings, have yet to find a buyer for their  49 percent stake in the Seagram Building due to the high asking price, Crain’s reported. The pair has looked to sell its stake since May for $700 million, which amounts to roughly $1,800 per square foot. The record price for an office building was set at 450 Park Avenue in 2007, at $1,585 per square foot.

Though Seagram, located at 375 Park Avenue near 53rd Street, is coveted for its location, its architectural design and its bevvy of elite investment firms paying high rents, Crain’s cites industry sources who say the price would need to be lowered to around $1,200 to $1,500 per square foot, in order for the stake to sell. [more]

Aby Rosen

From the July issue: Lately it seems developer Aby Rosen’s every business relationship is worthy of its own daytime soap opera. While Rosen and his company RFR Holding have been in the news a lot since the downturn hit because of struggles at 610 Lexington Avenue, which is on the brink of foreclosure, and because of a split with hotelier Ian Schrager, in the last few months the headlines have been even more fast, furious — and personal — than normal.

In May and June alone, multiple news outlets, including The Real Deal, have published accounts of Rosen’s business feuds. They include: turmoil with his long–time business partner and friend Michael Fuchs; a nasty lawsuit filed by investor Harry Lis involving the sale of one of their joint investments; and a salacious dispute Rosen had with billionaire partner Peter Brant, who is selling his stake in RFR’s Seagram’s Building. According to Crain’s, Brant is selling his stake partially because of “disparaging remarks” Rosen and Fuchs made about Brant’s wife, Stephanie Seymour, whom he’s divorcing.

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High prices paid by real estate investment trusts for U.S. hotels may be beginning to outpace gains in room rates and stays, according to Bloomberg News. Average prices paid for lodging properties rocketed to $185,000 per room in the first quarter of 2011, having previously peaked at $153,000 in 2006, before plunging 37 percent only two years ago.

While occupancy rates are rising (up to 63 percent in the first quarter from 60 percent a year earlier), the gains aren’t happening quickly enough to keep up with inflated prices being paid for some full-service properties, said Rick Kleeman, managing partner at Wheelock Street Capital, a Connecticut-based REIT. [more]

Adding to a portfolio that includes the Seagram Building and Lever House, developer Aby Rosen’s RFR Holding has bought the Paramount Hotel for $275 million from Walton Street Capital and Highgate Holdings, according to the Wall Street Journal. The deal is expected to close in the third quarter of 2011.
RFR had an incentive to buy, the Journal said, taking advantage of a tax law by reinvesting proceeds from a recent sale to defer a capital-gains payment. [more]

RFR co-founders Aby Rosen and Michael Fuchs, billionaire Peter Brant, investor Harry Lis and hotelier Ian Schrager

A $700 million asking price may be the least of prospective buyers’ concerns as they contemplate the purchase of a 49 percent stake in the landmarked Seagram Building at 375 Park Avenue, between 52nd and 53rd streets, according to Crain’s. Another major problem may be the trail of failed partnerships left behind by majority owners Aby Rosen and Michael Fuchs. Billionaire Peter Brant is selling his share of the property after his relationship with Rosen and Fuchs soured. At one point, the pair reportedly made somewhat disparaging remarks about Brant’s wife, former supermodel Stephanie Seymour. Brant and Seymour were reportedly going through an especially public divorce at the time of the remarks, with accusations of infidelity and drug use referenced in the media. Brant is expected to make between $100 million and $150 million from the sale, based on a valuation of about $1.1 billion for the building and its debt. [more]