The Real Deal New York

DelShah Capital helps settle bankruptcies at two Manhattan properties

February 21, 2012 03:30PM

After nine months of negotiations with debtors and creditors, DelShah Capital has resolved bankruptcies at two Manhattan properties, the firm announced today.

In Harlem, DelShah said it just took title to the 32-unit apartment building 321 Lenox Avenue, at the corner of 126th Street. The firm acquired the non-performing, $7.5 million senior mortgage note in 2010, and, as The Real Deal previously reported, expected to win the property in an auction last May. However, its plans were temporarily thwarted when the previous owner, investor Lorenzo De Luca, filed for Chapter 11 bankruptcy protection. DelShah reached agreements with De Luca and junior creditors and finally acquired the building this month.

Between acquiring the note and taking title to the building, DelShah financed a renovation that helped bring it to full occupancy from just under 60 percent at the time it purchased the note.

At the former H&H Bagel factory, at 639 West 46th Street, Delshah said it received payment in full  for its senior lien position plus 24 percent interest from the proceeds of a bankruptcy sale. Like the Harlem property, Delshah had expected to purchase the building out of foreclosure last year because it possessed the $4 million debt on the 25,100-square-foot property near 11th Avenue. But owner Helmer Toro filed for bankruptcy protection and blocked the sale. Delshah said the case was converted to a Chapter 7 liquidation, and the property was sold to second mortgage-holder MKF Management this month. MKF confirmed it owned the property and said it is now available for rent.  — Adam Fusfeld