Auction set for Bryant Park site with $43M note

By Adam Pincus | June 02, 2010 06:48PM

Ascent’s proposed residence and hotel (left) for the lot at 14-20 West 40th Street

A vacant parcel facing Bryant Park where developers once planned to build a shimmering environmentally advanced condominium hotel called View at Bryant Park has been scheduled to be sold at auction later this month following the default of a $43 million loan.

A New York State Supreme Court judge set the auction date for June 23 for the parcel at 14-20 West 40th Street, between Fifth and Sixth avenues on the south side of the park, data from shows.

The four-parcel site includes about 189,000 square feet of buildable space with frontage on 39th and 40th streets, according to Department of City Planning documents.

An affiliate of Midtown developer Ascent Real Estate Advisors, known as 40th Street Partners, bought the property in September 2006 for $45 million. To finance the purchase, the developer borrowed $43.9 million from Petra Capital Mortgage, which transferred the loan to a debt security called Petra CRE CDO, court records show. 

Ascent won approval from City Planning in 2008 for a special permit to build a hotel and condominium project. No plans were ever approved by the Department of Buildings, city records show.   

In May 2008, a principal with Ascent was quoted in the New York Observer saying construction would begin in August that year of the Morris Adjmi-designed project, but the company was never able to obtain construction financing. 

Instead, Petra CRE CDO filed to foreclose on the defaulted loan in March 2009, court records show. 

John Porges, a principal with Ascent, declined to comment. Petra declined to comment. 

Some outsiders said it is possible the auction price could be higher than the value of the note, which would equate to about $230 per square foot.  

Comparable development sites at 678-684 Lexington Avenue at 56th Street sold for about $388 per square foot in March, and the Drake Hotel site at 434 Park Avenue sold for more than $500 per square foot in January, data from Massey Knakal Realty Services shows. 

John Cicero, a managing principal at appraisal firm Miller Cicero, noted that there had been very few development sites sold recently. But he pointed to the Lexington Avenue sale and another in November 2009 which were both above $300 per square foot as examples of recent prices in Midtown.

“This parcel is certainly every bit as good as those parcels. You can draw your own inference on pricing but I see no reason this would trade for any less than that,” he said.