The Real Deal

• Email this article
• print
• Comments(10)

Jasper's fate uncertain as condo faces foreclosure

Shaun Osher (left) and the Jasper

Developer Harry Jeremias is facing a foreclosure suit on the Jasper, the Ismael Levya-designed condominium conversion in Murray Hill, after defaulting on $83 million in loans and failing to complete the sale of the property to European investors.

Petra Capital Management on Monday filed to have the New York State Supreme Court appoint a temporary receiver for the 80-unit building at 114 East 32nd Street. The move comes just one month after the real estate fund filed to foreclose on the condo.  

According to records filed with the Department of Finance, Jeremias, founder of the Harch Group and president of PHH Realty, originally acquired the former office building from Parklex Associates in May 2006 for $53 million. Jeremias, through a subsidiary firm called Morgan 32 Holding, borrowed $93.75 million from Petra Mortgage Capital in February 2007.

Jeremias and his two business partners at PHH, Henry Orlinsky of Teaneck, N.J., and Francisco Pujol of San Juan, Puerto Rico, took out personal guarantees to secure the loan for the project developed by PHH and Harch. Core Marketing Group was hired as the exclusive sales and marketing agent for the project.

As The Real Deal previously reported, the Jasper opened to great fanfare, with the developer claiming more than 40 contract signings in the first several months of sales and hosting a week-long open house in May 2008, which included free food from local Murray Hill restaurants, like Blue Smoke and Dos Caminos.

Prices ranged from $795,000 for a 591 square foot studio to $2.9 million for a 1,594-square-foot, three-bedroom unit, according to Streeteasy.com.

By November 2008, however, the New York Times reported that the conversion was halted, citing slow sales and millions of dollars in cost overruns. Harch Group announced that a European investment group would convert the building into a boutique hotel and that buyers would receive their deposits back. However, the deal with the European investors later fell through as well.

"I guess what you should say is the ultimate fate of the project lies with the bank now," said Shaun Osher, CEO of Core Group Marketing, the project's marketer. "I think the bank still feels that the best and highest use for this project will be as a condominium, not as a rental."

Jeremias is still moving forward with plans for the Renwick, a 44-unit condominium at 15 Renwick Street in Soho.

Sara Polsky contributed to this report.