Charles Cohen Faces Foreclosure on Houston Office Asset

Troubled billionaire Charles Cohen’s office woes are cropping up in Houston.

Foreclosure is looming for Cohen Brothers Realty-owned Decorative Center Houston. New York-based lender Ladder Capital Finance claims Cohen defaulted on a $50 million loan provided in 2014, according to Roddy’s Foreclosure Listing Service.

The 500,000-square-foot building, at 5120 Woodway Drive in Uptown Houston, could be auctioned Tuesday at the Harris County Courthouse if they don’t reach a deal.

Cohen Brothers Realty didn’t respond to a request for comment in time for publishing.

The property, which was developed by Trammell Crow Company in 1984, features showrooms and a glass-cladded office tower. The building was valued at $57.4 million this year, appraisal district records show. Cohen Brothers Realty bought it in 2000. Colliers handles leasing.

The foreclosure is just the latest punch to the office landlord in his yearslong brawl with lenders.

The real estate scion defaulted on a $534 million loan from Fortress, which last year took back a cluster of deals with a $148 million credit bid in the largest UCC foreclosure ever. Fortress claimed Cohen was shuffling assets before the auction to hide them from the lender. It alleged Cohen put his $20 million Greenwich, Connecticut, mansion into a trust in his wife’s name and transferred ownership of four luxury boats valued at $50 million.

Then, a New York Supreme Court judge ruled that Cohen would have to pay a $187 million personal guarantee after a half-a-billion-dollar default. Cohen lost the appeal he filed to block the collection in February.

Houston’s office market has struggled to recover from changes brought on by remote work and the flight-to-quality trend. In the first quarter, vacancy was 25.8 percent, according to the Greater Houston Partnership, citing data from CoStar.

The market’s construction pipeline has thinned out, with 1.1 million square feet of office space in the pipeline in the first quarter, according to Partners Real Estate. That’s a 63 percent drop from the year before, when there was 2.98 million square feet of office space under construction.