Things are getting real at Meringoff Properties’ Soho property after lender Aareal Bank filed a foreclosure action claiming two unpaid mortgages.
The German bank filed its case in Manhattan Supreme Court last week, Crain’s reported. The lender is looking to seize control of the 171,000-square-foot property at 462 Broadway, owned by an affiliate of Meringoff Properties.
Meringoff defaulted in May on a pair of mortgages with a principal balance of $149.3 million, the bank claims in the lawsuit.
Aareal made two loans to Meringoff in June 2016 for a combined $135 million, consolidated years later into a single mortgage with the same principal balance. Last May, Aareal loaned another $14.3 million to Meringoff, which had filed permit applications for the addition of a roof terrace.
A year later, Meringoff defaulted on both loans after failing to obtain insurance for the consolidated $135 million mortgage, according to the suit. Aareal claims Meringoff failed to make payments in the months leading up to the default.
Aareal wants the court to appoint a receiver to collect rents and profits before any auction of the property. It also wants the ability to bid on the building using its outstanding debt.
An attorney representing Aareal and Meringoff both did not respond to Crain’s requests for comments. Meringoff also did not immediately respond to a request for comment from The Real Deal.
Meringoff acquired the office and retail property as part of a $3.7 million portfolio purchase in 1995, according to CoStar. Meringoff renovated the 19th century building in 2018 and has kept it occupied, boasting a 100 percent leasing rate as of Monday, according to CoStar. Software firms Centrical and Coro Cybersecurity are among the building’s tenants.
The building is the largest cast-iron structure in Soho, according to PBDW Architects.
— Holden Walter-Warner
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