Maverick Acquires Gorham Building In $50M Foreclosure Sale

Maverick Real Estate Partners has finally taken control of the Gorham Building, ending a monthslong legal battle with the property’s longtime owners.

Maverick acquired the 140,000-square-foot commercial building at 390 Fifth Avenue through a foreclosure sale, according to property records. The transfer, valued at $50 million, comes after a New York judge cleared the way for the lender to proceed with foreclosure.

The Schwalbe family had owned the 1905 Stanford White building, which contains offices and showrooms, since at least 1969, according to public records.

The sale caps a contentious dispute over a $41 million loan on the property. In February, a court temporarily halted Maverick’s foreclosure efforts after Fred and Robert Schwalbe accused the lender of reneging on a deal to extend the loan. The brothers alleged that Maverick employed “vulturous tactics,” accepting hundreds of thousands of dollars in fees while repeatedly changing the terms required to push back the loan’s maturity date.

According to the complaint, the borrowers owed a $41 million payoff on New Year’s Eve and intended to exercise an extension option contained in the loan documents. After paying a $200,000 extension fee, Maverick allegedly demanded an additional $1.5 million interest shortfall that the borrowers claimed was not required under the agreement.

The Schwalbes also claimed Maverick instituted a full cash sweep before declaring a default,

leaving ownership unable to pay operating expenses.

In February, a court ordered a pause on the foreclosure sale. The next month, however, a judge denied the family’s request for a preliminary injunction, finding the borrowers had failed to demonstrate “irreparable harm” by Maverick. The ruling reopened the path to foreclosure.

Neither Maverick nor an attorney for the Schwalbe family responded to requests for comment.

Maverick has built a reputation as one of New York’s most aggressive real estate debt buyers, often purchasing distressed loans and pursuing foreclosure to gain control of properties.