Toledano in contract to sell distressed Chelsea building

Private family office to buy 125 West 16th St. deed and note for $49M

Raphael Toledano and 125 West 16th Street
Raphael Toledano and 125 West 16th Street

Raphael Toledano is in contract to sell a six-story Chelsea rental building, the single-most valuable property in his dwindling holdings, sources told The Real Deal.

A local private family office signed a hard contract to buy both the deed and the note on the distressed 39-unit property at 125 West 16th Street for a total of $49 million, according to William Schneider, an attorney who represents the buyer, AAK Acquisitions LLC.

In two separate deals, the buyer is paying $43 million for the note to the lender, Madison Realty Capital, and $6 million to Toledano’s Brookhill Properties and partners, Schneider said. The bulk of the funds will repay the debt; the rest is equity.

Madison has been putting the property through foreclosure proceedings since January.
Toledano bought the building for $41.5 million in 2015.  He said he planned to name it the Devorah, after his wife. Madison provided $34 million in financing, including $29.8 million up-front for the acquisition and a proposed expansion plan that Toledano later abandoned.

Representatives for Brookhill and Madison declined to comment.

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Aaron Jungreis

Aaron Jungreis, president of Rosewood Realty Group, is brokering the deal. Jungreis is Toledano’s uncle, and once accused the investor of squeezing him out of a major East Village portfolio purchase. That suit was later settled. Jungreis declined to comment.

Toledano, a controversial 27-year-old landlord, is currently juggling several court cases and in the process of losing several key assets.

He is selling the deeds for a distressed, bankrupt 15-building portfolio — the one tied to the settled Jungreis suit — to lender Madison. He is also in a legal tussle with developer Michael Shah over a distressed walk-up at 97 Second Avenue. At the sane time, he is facing eviction at his $13,000-a-month Upper West Side apartment at a Simon Baron Development-owned building, where he claims to be a rent-stabilized tenant.