Joseph Sitt Risking Foreclosure in Lower East Side

Joseph Sitt is dealing with more foreclosure threats to his Manhattan retail portfolio.

A limited liability company filed a lawsuit against Sitt this week alleging default on a loan of more than $2 million at 195 Bowery on the Lower East Side, Crain’s reported. The Thor Equities chair was individually named in the case regarding the commercial condo unit.

Sitt took out the loan in 2018 from Signature Bank. When the bank failed last year, the loan was transferred to the Federal Deposit Insurance Corp., which served as a receiver.

The mortgage holder is now an entity called Sig Cre 2023 Venture, which obtained the note in April. The company notified Sitt of the loan default at the time, but he remains nearly $2 million behind on the balance, including interest and fees, according to the lawsuit.

Thor purchased the ground-floor retail space in 2014 for $4 million. The tenant is Pop International Galleries, which shows and sells works from famous artists, including Andy Warhol and Jean-Michel Basquiat.

Sitt did not respond to a request for comment from Crain’s.

The commercial firm head is only a few months removed from losing a pair of Manhattan retail properties to foreclosure. Maverick Real Estate Partners took control of 446 West 14th Street, a 26,000-square-foot property near the High Line in the Meatpacking District, after Sitt allegedly missed several mortgage payments and struggled to hang on to a long-term tenant.

In Soho, Midland foreclosed on Thor at 440 Broadway, alleging Sitt’s company defaulted on the original $13.2 million loan backing the property. The anchor tenant of the property is Foot Locker, which is on an expiring lease that it has not renewed.

While Sitt is dealing with another foreclosure threat to his portfolio, he’s part of a push for Macy’s to shift strategies. Sitt and Barington Capital are part of an activist investor group that says Macy’s needs to form a real estate unit, arguing its assets are worth up to an estimated $9 billion.

— Holden Walter-Warner