Davis Development Holdings, led by investor Trevor Davis, is facing a $17 million foreclosure lawsuit from Manhattan-based Ark Real Estate Partners after defaulting on his Upper East Side condominium site at Lexington and 65th Street.
Davis, the former development partner of RFR Holding’s Aby Rosen and Michael Fuchs, missed a $94,800 mortgage payment in October and fell behind on payments to MRC Contracting, according to the suit.
The lender is now demanding a total of $19.5 million, which includes outstanding interest, principal and late charges. The lender said it reserved the right to appoint a receiver to take over the project, according to the suit, filed Oct. 26, in New York State Supreme Court.
Davis originally acquired the properties at 859 and 861-863 Lexington Avenue for a total of $23 million from artist and jewelry designer Barry Kieselstein-Cord, according to city financial records. The purchases included air rights from the Caravan Institute at 132 East 65th Street.
The deal was considered controversial as local preservationists fought to preserve the historic site known as the Kean Residence, at 861-863 Lexington Avenue.
The Ark Investment Partners Web site describes the planned site as a “65,900-square-foot mixed-use development project” that includes 25 luxury condo units, 5,908 square feet of retail space and 2,000 square feet for storage. The project was to be called the Honore, according to an August posting on Curbed.com.
Despite the foreclosure suit, Davis said he plans to work out a deal and move forward with the project.
“The project on 65th Street is going ahead,” said Davis in an e-mailed statement. “Construction is underway. I’m in the process of working things out and negotiating with the lender in this difficult environment.”
Attorneys for the lender were not immediately available. Friends of the Upper East Side Historic Districts, which opposed the demolition of the site, were not immediately available for comment.