The Real Deal New York

Archdiocese seeks $100M mortgage to pay abuse victims

Loan to be backed by land under Lotte Palace hotel
March 01, 2017 08:34AM

The Lotte Palace hotel

The Archdiocese of New York filed a petition for a $100 million mortgage on several Midtown properties to pay off victims of sexual abuse.

The Mortgage Would Be Backed By The Land Under The Lotte Palace Hotel And The Villard Houses Mansions On Madison Avenue. The church bought the land after World War II. In the 1970s, it signed a 99-year ground lease with developer Harry Helmsley, who built the 54-story hotel. In 2015, Korean insurer Lotte bought the leasehold on the hotel for $805 million.

The planned mortgage will have a one-year term. JPMorgan Chase is the lender. A spokesperson for the church told the New York Times that it is taking out the loan because it doesn’t know yet how much it will have to pay in settlements to abuse victims.

Church officials announced a compensation program for victims of sexual abuse at the hands of clergy last October. In the first phase of the program, 44 victims accepted settlements.The second phase begins this week, and 26 people have registered claims. [NYT]Konrad Putzier