Receiver Appointed in 625 N Michigan Ave Foreclosure

Distress at 625 North Michigan Avenue is entering its next phase: receivership.

On June 16, a Cook County judge appointed Scott Shefman of Friedman Real Estate Management as the receiver for the Magnificent Mile office building, court records show.

Shefman’s takeover of the 28-story property’s operations stems from a foreclosure lawsuit filed by Citibank, acting as trustee for commercial mortgage-backed securities bondholders, alongside special servicer LNR Partners. The lenders allege landlords Golub & Company and BlueFive Capital defaulted on a $50.6 million loan. The debt, originated by Cantor Commercial Real Estate in 2019 with a 4.63 percent interest rate, reached its maturity date on March 6 without repayment.

The loan transferred to special servicing in November 2025 due to an imminent default driven by cash flow issues. Golub previously indicated to the lender that it couldn’t continue funding the property’s operating expenses out of pocket. In April 2026, the borrowers received a formal notice of default.

As receiver, Shefman takes control of the nearly 290,000-square-foot building’s management. His court-mandated duties include collecting rents from tenants and maintaining new bank accounts; negotiating, modifying and executing leases; and assisting in marketing the property for sale, which may involve soliciting offers.

Neither Shefman nor Golub returned requests for comment.

The tower has struggled significantly with tenant retention. Occupancy at the property dropped to roughly 63.8 percent in 2025, a steep decline from the 91.8 percent occupancy rate recorded when the loan was underwritten in 2019. Furthermore, the property stopped generating enough revenue to cover the cost of its debt service, with the debt service coverage ratio plummeting to 0.96 in the first quarter of 2025, about 52 percent below underwriting projections. This financial deterioration triggered a cash management sweep by the lenders.

The loan default and the subsequent foreclosure only cover the office portion of the high-rise, spanning floors five through 27. The building’s retail space, located on the lower four floors, is owned separately. In 2024, investor Ben Ashkenazy surrendered that retail portion to his lender with a deed-in-lieu of foreclosure to resolve a separate $61 million debt.

This foreclosure adds to ongoing distress along the Mag Mile and marks another loss for Golub & Company. The firm previously lost the 36-story tower at 444 North Michigan Avenue to Blackstone through a deed-in-lieu of foreclosure.