Tessler swoops in to develop NMP’s Madison Ave site

From left: Yitzchak Tessler and NMP Attorney John Stewart
From left: Yitzchak Tessler and NMP Attorney John Stewart

Yitzchak Tessler is joining forces with NMP Group to salvage 172 Madison Avenue from what, up until now, looked like foreclosure.

Tessler has agreed to pay off debt and fees owed to CIM Group, then partner with NMP in a deal worth at least $55 million to develop the site.

The proposed debt repayment must still be approved by state bankruptcy court, as John Stewart, NMP Group’s attorney, who works with law firm Cole Schotz, told Crain’s. If all goes as planned, that green light should come next month.

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“There is $55 million owed on the loan and interest due, but this site is worth $70 million or more so clearly it was worth the effort by NMP to work out a deal to hold onto it,” Stewart told Crain’s. “They invested a lot into it and unfortunately were set back by bad timing during the recession.”

NMP Group bought the site in 2007, but the company fell into default by 2011. CIM picked up the $29 million mortgage and began foreclusure proceedings, having nearly completed the process by June of this year. NMP then put the holding company controlling the property into bankruptcy.

The $55 million owed to CIM come from mostly fees and higher interest charged on its defaulted loan. CIM could not be reached by Crain’s for comment. [Crain’s]Julie Strickland