UPDATED 2:15 p.m., July 2: A senior lender at 125 Greenwich Street, the troubled residential condominium supertall in the Financial District, has moved to foreclose on the project.
United Overseas Bank, a Singapore-based lender, filed a notice to foreclose on the developers at the Downtown site Monday, claiming that the lending consortium at the project is owed $195 million it advanced to the developers, plus outstanding interest payments.
It is the latest setback for the tower’s sponsors, who have struggled to get the 275-unit project finished and are dealing with lackluster sales. If the new foreclosure proceedings by UOB move forward, they will wipe out $130 million in equity and preferred equity in the project, owned by equity partner China Cindat, Davide Bizzi’s Bizzi & Partners, Howard Lorber’s New Valley and investment firm Carlton Group. A foreclosure would also wipe out about $200 million in junior debt, issued by multiple lenders.
According to the complaint, filed in New York State Supreme Court, the sponsors defaulted on loan repayments at the start of June. They also allegedly received mechanics liens totaling $40 million in May, filed by general contractor Plaza Construction, which also triggered a default in payments.
The 1,396-foot-tall, 88-story skyscraper, designed by Rafael Viñoly, topped out in March. That marked a victory for the project’s developers, who have been dogged by infighting and have struggled to make loan repayments since the project started in 2014.
But the celebration was short-lived, after a mezzanine lender at the site issued a notice of intent to foreclose last month. Nick Mastroianni, whose U.S. Immigration Fund helps developers raise money through the EB-5 visa program, provided the $194 million mezzanine loan. He said he would proceed with a foreclosure only as a “last resort.”
The sponsors are currently negotiating with the lending arm of Silverstein Properties to refinance the current debt at the project, according to Mastroianni. Two other people confirmed this. Silverstein declined to comment.
“[United Overseas Bank] will be paid off,” Mastroianni said. “The project will be finished.”
Representatives for New Valley, China Cindat and Bizzi & Partners did not respond to a request for comment.
Units are priced between $1.3 million and $6 million. The tower’s total projected sellout is $875 million. Douglas Elliman, the brokerage which Lorber runs as chairman, is handling sales.