1 St. Mark’s Place heads for foreclosure

Madison Realty Capital says borrower defaulted on $48M mortgage

New York /
Aug.August 16, 2021 02:42 PM
1 St. Mark’s Place heads for foreclosure

1 St. Mark’s Place rendering; Madison Realty Capital Managing Principals and co-founders Josh Zegen and Brian Shatz (LinkedIn)

Madison Realty Capital has taken steps to foreclose on Real Estate Equities Corp.’s leasehold interest at 1 St. Mark’s Place in the East Village.

The New York City–based Madison has owned the $48 million loan package backed by REEC’s East Village property since 2019. The real estate private equity firm acquired the debt from South Korean financial services firm Hana Financial group, which provided REEC $79.1 million of debt and sold the $48 million portion to Madison Realty Capital.

Madison filed a complaint with the state Supreme Court in Manhattan, alleging that REEC defaulted on the $48 million mortgage, which combines an acquisition loan and construction loans.

“We are working on a recapitalization plan and are optimistic that this will be resolved in the near future,” a spokesperson for REEC told The Real Deal.

The state has extended its Covid-19 emergency eviction and foreclosure moratorium for commercial property owners until Aug. 31. Madison Realty Capital, which declined to comment, stated in the filing it has not received a hardship declaration from the borrower.

In 2017, REEC paid $150 million for a 99-year leasehold on a three-parcel assemblage at 1 and 3 St. Mark’s Place and 25-27 Third Avenue, TRD reported.

REEC plans to build a nine-story, 68,000-square-foot boutique office building to attract tenants paying top-dollar rents. The site is across Third Avenue from Minskoff Equities’ 51 Astor Place, where IBM Watson Group is headquartered.

Manhattan’s office availability rate is at a record-high of more than 17 percent. But many developers and landlords say that high-quality office products in desirable locations should still be able to attract tenants.





    Related Articles

    arrow_forward_ios
    The Centre at Purchase at 1, 2, 3, 4 Manhattanville Road with George Comfort & Sons CEO Peter Duncan (George Comfort & Sons)
    Westchester office park owned by George Comfort & Sons slated for auction
    Westchester office park owned by George Comfort & Sons slated for auction
    Wells Fargo hit with $400M suit for breach of contract linked to robo-signing scandal
    Wells Fargo hit with $400M suit for breach of contract linked to robo-signing scandal
    Wells Fargo hit with $400M suit for breach of contract linked to robo-signing scandal
    250 Park Avenue and IWG CEO Mark Dixon (Google Maps, IWG)
    IWG to open 58K sf co-working site on Park Ave
    IWG to open 58K sf co-working site on Park Ave
    Flight to quality in office real estate leaves trophy buildings the only winners
    Flight to quality in office real estate leaves trophy buildings the only winners
    Flight to quality in office real estate leaves trophy buildings the only winners
    The hotel on Rockaway Beach sold for $25 million (Google Maps)
    Pandemic pricing arrives to middle of i-sales market
    Pandemic pricing arrives to middle of i-sales market
    US office investment market remains well below 2019 levels
    US office investment market remains well below 2019 levels
    US office investment market remains well below 2019 levels
    Microsoft CEO Satya Nadella and American Express CEO Stephen Squeri (Getty, American Express)
    Microsoft, AmEx push back office returns
    Microsoft, AmEx push back office returns
    Facebook CEO Mark Zuckerberg and 770 Broadway (Getty, VNO)
    Facebook still looking for space in NYC
    Facebook still looking for space in NYC
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...