CIM close to taking control of Madison Ave. development site

Previous owner planned 250-unit hotel before facing foreclosure

New York /
Jun.June 25, 2013 05:30 PM

CIM Group, the California-based real estate investment giant and one of the developers behind the luxury tower at 432 Park Avenue, may be poised to take full control of another prospective hotel or condominium development site on Madison Avenue, The Real Deal has learned.

The corner site, a parcel at 172-176 Madison Avenue and 21 East 33rd Street, will hit the foreclosure auction block in July with an outstanding lien of $51.23 million, according to PropertyShark. It was formerly controlled by Russian developer Natalia Pirogova, whose NMP-Group inked a deal to buy the site, part of which was then home to an office building, for a combined $21.4 million in 2007.

CIM, which previously bought the debt on the property, may bid to take title at auction; it was not clear if other parties will submit bids. The official foreclosure judgment against Pirogova was issued June 12, records show.

The site is primed for a mixed-use tower of up to 100,000 square feet based on the site’s current zoning designation, according to data from PropertyShark. Pirogova had been planning to bring a 250-unit hotel or a mixed-use hybrid condo and hotel tower to the location before falling into financial difficulties, it was previously reported.

CIM snapped up Pirogova’s $29 million debt from lender Garrison Investment Group in 2011, prompting the Russian property maven to file suit against them. Pirogova claimed that CIM had misrepresented their intentions and used privileged information in order to acquire the note. She said the company had previously had an oral agreement to work together with NMP in a joint venture to build the tower. The case is still ongoing, court records show.

The total size of the lot is 10,647 square feet, according to PropertyShark. The auction will take place July 10 at 60 Centre Street.

A spokesperson for CIM did not immediately respond to a request for comment. Pirogova could not be reached.

Residential developers have been particularly bullish on sites in and around the NoMad and Midtown East areas in recent months. JSR Capital, the Manhattan-based real estate investment firm headed by Africa Israel alumnus Jona Rechnitz, is planning to build a new condominium or hotel project at 238 Madison Avenue, between 37th and 38th streets, and developer Victor Homes recently launched a new condo project at 241 Fifth Avenue at 24th Street.

The Naftali Group is also planning a 20-story condo tower at 234-238 East 23rd Street, between Second and Third avenues, it was reported today.


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