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Thor’s $150M loan on 597 Fifth heads to special servicing
Firm led by Joe Sitt has not made payment on 86K sf building since July
![Joe Sitt and Charles Scribner’s Sons Building in Midtown (Thor, Google Maps)](https://static.therealdeal.com/wp-content/uploads/2020/11/1200-150M-Thor-loan-on-historic-Midtown-property-at-risk-of-default.jpg)
Thor Equities’ troubles at 597 Fifth Avenue are mounting.
The firm’s $105 million commercial mortgage-backed securities loan tied to the Charles Scribner’s Sons Building has gone into special servicing, according to a Trepp report. Joe Sitt’s firm has not made a loan payment on the 86,000-square-foot building since July.
Thor’s attempt to pay off part of the loan at a discounted amount was rejected by the servicer, according to Trepp. The mortgage on the Midtown property is now at risk of “imminent payment default.”
Thor bought the century-old building for $108.5 million in 2011. It landed the $105 million refinance from UBS Real Estate Securities three years later. Thor also took on additional debt, including a $25 million junior mezzanine loan from SL Green Realty and a $10 million senior mezzanine loan from Toronto-based Oxford Properties.
At the time of the 2014 deal, the 12-story Beaux Arts building had an appraised value of $180 million.
The building has had a revolving door of retail tenants since Sephora exited its 8,000-square-foot space in 2017. Thor then inked a short-term lease with Lululemon for that space. The retailer left in 2019 for 20,000 square feet at nearby 592 Fifth Avenue; Club Monaco replaced it the same year. Flex-office provider Knotel signed a 6,400-square-foot lease for a different space at the building the same year.
Meanwhile, Thor has offloaded some of its Manhattan retail properties in recent years, including a commercial condo at 51 Greene Street and three retail condos at 212 Fifth Avenue. In August, the company defaulted on a $25 million mezzanine note from SL Green on 590 Fifth Avenue.
A spokesperson for Thor did not immediately return a request for comment.