RFR Faces Foreclosure on 285 Madison

Aby Rosen’s lenders are not wasting any time.

The bondholders on a $219 million CMBS loan tied to his Grand Central office tower 285 Madison Avenue filed to foreclose Monday, less than six weeks after Rosen and Michael Fuchs’ RFR Holding defaulted.

After the default, the loan had landed in special servicing, typically a type of limbo where negotiations can buy borrowers months of time. Sometimes special servicers drag out talks longer than necessary, bloating their fees.

Not at 285 Madison, though.

A pre-foreclosure filed so soon after a default can signal a lender’s loss of patience with a borrower or low confidence that a workout can be reached.

A spokesperson for RFR declined to comment. Last month, the firm had said it was “committed to [285 Madison] and looks forward to working with the special servicer.”

It was the third such filing against RFR this month, perhaps reflecting a copycat effect in which one lender’s actions prompt others to do the same.

At 285 Madison, the special servicer gave Rosen second and third chances.

The special servicer first granted an extension in November 2022 that pushed the maturity date until May 2024. In April, the loan transferred to special servicing after Rosen claimed he could not pay it off by the due date, according to Morningstar Credit.

The lender then granted a few months’ forbearance, giving Rosen until November to refinance — a modification that came after the firm had defaulted on $205 million in subordinate debt tied to the deal, the Promote reported.

In October, a New York judge ordered RFR to fork over $18 million to the mezzanine lender on that loan.

Late last month, Rosen asked for one more extension on the senior CMBS debt, Morningstar details. Weeks later, the foreclosure filing landed.

The asset itself isn’t in terrible shape considering the distress rattling New York office properties. As of June it was 96 percent leased, according to Morningstar. It is, however, overleveraged. Debt totals $419 million on the property, which was reappraised in July at $300 million — half of its former value.

Lenders are gunning for other RFR assets. In December, RFR faced pre-foreclosure at 17 State Street in FiDi and at the Empire Condominium, 188 East 78th Street on the Upper East Side, following defaults.

Rosen and Fuchs also face foreclosure on Midtown office buildings 475 and 522 Fifth Avenue and are fighting Cooper Union to take back the Chrysler Building ground lease.