USIF schedules foreclosure auction for 125 Greenwich debt

United States Immigration Fund, led by Nick Mastroianni, signalled its intent to foreclose on the downtown luxury residential tower last month.
By David Jeans and Rich Bockmann | July 09, 2019 06:15PM

Nick Mastroianni and the tower at 125 Greenwich Street (Credit: StreetEasy)

Nick Mastroianni and the tower at 125 Greenwich Street (Credit: StreetEasy)

A lender who last month signalled intent to foreclose on 125 Greenwich Street, the troubled downtown residential tower, will auction the mezzanine debt on the building next month.

The lender, United States Immigration Fund, provided a $194 million mezzanine loan to the project’s sponsors in 2017. Led by Nick Mastroianni, the firm raises funds through the EB-5 visa program.

Since topping out at 88 floors earlier this year, the Rafael Vinoly-designed building has been marred by infighting between its developers and their lenders. Amid slow apartment sales, the building’s sponsors defaulted on loan repayments at the start of last month, and owed close to $40 million to construction crews at the site.

Last month, USIF signalled that it intended to foreclose on the property, in a letter sent to the project’s sponsors, which include Howard Lorber’s New Valley, Davide Bizzi’s Bizzi & Partners, China Cindat and the Carlton Group.

Weeks after USIF signalled an intent to foreclose last month, the project’s senior lender, United Overseas Bank also filed a notice of foreclosure, after it said the sponsors had defaulted on a $473 million loan, according to a complaint filed with New York State Supreme Court.

If USIF’s auction proceeds, the new owner of the mezzanine debt will have the right to foreclose on the building, a move that would wipe out more than $130 million in equity in the building held by the sponsors.

To market the debt ahead of an auction next month, USIF tapped a Newmark Knight Frank team led by Dustin Stolly and Jordan Roeschlaub, according to a notice of Uniform Commercial Code foreclosure sale seen by The Real Deal. The brokers could not be reached for comment.

Currently, the developers have signed a term sheet with Silverstein Capital Partners to refinance the debt on the project, according to multiple people close to the project. A JLL team led by Aaron Appel was tapped to market the refinancing. If this goes ahead, the lenders would be repaid and bring a halt to the foreclosure motions.

Mastroianni and representatives for New Valley and Bizzi & Partners did not return requests for comment.