Kushner Companies is no longer delinquent on loan payments tied to its struggling Times Square retail property.
The development group is now in a grace period on a $285 million CMBS loan secured by the 248,457-square-foot retail condo at 229 West 43rd Street. The loan had been over 90 days delinquent.
The loan was brought out of delinquency in October when lender-held reserves were used to make outstanding interest payments from April through September, according to Fitch Ratings. But it remains in special servicing.
A recent appraisal slashed the property’s value by 80 percent, from $470 million in 2017 to $92.5 million, according to Trepp.
The appraisal came after two of its major tenants — Gulliver’s Gate, which filed for bankruptcy in 2019, and National Geographic — vacated. That dropped occupancy down to 52 percent from 95 percent last year, according to Trepp.
Kushner’s retail property occupies four floors of an 18-story office building where the New York Times was headquartered until 2007. The firm bought the property in 2015 for $296 million from Lev Leviev’s Africa-Israel.
The company soon secured $370 million in refinancing, including a $70 million mezzanine loan from Paramount Group, a $15 million mezzanine loan from SL Green and a $285 million CMBS loan from Deutsche Bank.
But the property had issues even before the pandemic. In 2017, celebrity chef Guy Fieri’s Guy American Kitchen closed with 10 years left on its lease. Subsequent plans to open a food hall led by Todd English fell apart as the developer and chef became entangled in litigation.
Kushner Companies did not immediately return a request to comment.