The Manhattan home of a social club for New York’s elite is caught in a tug-of-war as Aby Rosen’s RFR Holding tries to cling to the property while its special servicer drags it away.
A special servicer has called for 60 East 55th Street — where Core Club is located — to be sold at auction to satisfy $23 million in debt remaining on a principal loan amount of $25 million, according to court records filed Wednesday in the Southern District of New York.
The property was transferred into special servicing in July 2020 after falling behind on payments. RFR had requested Covid-19 relief for the property in May of that year.
On Aug. 25, RFR received a Notice of Default after its failure to make payments for May, June, July and August of 2020. RFR continued to miss payments and on Nov. 23 the company received a Notice of Acceleration, meaning all mortgage payments, including past missed payments, would be due.
Sweetgreen restaurant occupies the ground floor and lower level of the building. The Core Club takes up the second through sixth floors, along with a portion of the basement, in the 41-story tower. Both have failed to pay rent for “certain months” in 2020 and 2021, the filing states.
Core Club occupies about 32,000 square feet of the building on a $2.1 million-a-year lease that extends through mid-2026. Sweetgreen has a $500,000-a-year lease that expires in early 2029.
Rosen is a founding member of Core Club, along with Vornado Realty Trust’s Steven Roth, Blackstone Group’s Stephen Schwarzman and other executives from various industries.
The upper floors consist of 76 residential condo units, which are not collateral to the loan, The Real Deal previously reported.
RFR Realty did not respond to requests for comment.
60 East 55th Street is not the only Rosen-owned property that has run into turmoil during the pandemic. After falling behind on nearly $1 million of ground lease payments, Solil Management sued to terminate RFR’s long-term lease at the Gramercy Park Hotel and collect $79.5 million.
Even as it continued to default on payments for other properties, earlier in May, RFR entered a contract to buy the retail portion of 522 Fifth Avenue.