110 East 55th Pre-foreclosure Hints at Gary Barnett’s Moves

Is Gary Barnett at it again?

A Midtown office building that the Extell principal has been eyeing for his growing assemblage has been hit with a pre-foreclosure suit filed by a construction company that has previously partnered with Barnett.

An entity tied to construction company JT Magen has filed for foreclosure on the 73,000-square-foot building at 110 East 55th Street, claiming owner Parkoff Organization defaulted on the loan and owes $40.6 million in principal and interest.

JT Magen, which recently teamed up with Extell on a foreclosure in Boston, took over the mortgage from Flagstar Bank in March, according to property records. The lender is seeking a foreclosure sale in a lawsuit filed Wednesday in state Supreme Court that was first reported by PincusCo.

The office building appears to be one of the last remaining pieces of the massive development project Barnett is stitching together on Park Avenue.

Extell earlier this month paid $500 million to buy the development site at 405-417 Park Avenue, which is adjacent to the 19-story Parkoff building. The company also bought air rights from the Central Synagogue for $20 million and has been said to be eyeing more properties.

The project has about 527,000 square feet of development as-of-right, which can grow up to 700,000 square feet of rentable office space with more air rights.

Earlier this week, Extell bought an office building on East 56th Street two blocks away, fueling speculation about Barnett’s broader strategy. Barnett is also said to be looking to buy a building at 111 East 54th Street, home to the private club The Brook.

Observers speculated that the developer planned to acquire the building and relocate The Brook to the former Friars Club building at 57 East 55th Street, which Extell recently purchased for $19 million in what appeared to be a clever and calculated game of development chess.

The latest pre-foreclosure suit could be another one of Barnett’s calculated plays. In March, Extell teamed up with lender JT Magen in March to win a $75 million foreclosure auction for a five-acre development site in Boston, the Boston Business Journal reported.

Representatives for Extell, JP Magen and Parkoff Organization did not immediately respond to requests for comment.