$18M pre-foreclosure filed at troubled Shirokia condo in Flushing

By Adam Pincus

An unidentified investor filed to foreclose on an $18 million loan provided to the owners of the Shirokia condominium project at 142-28 38th Avenue in Flushing, Queens. The 2008 building has 23 residential units and four commercial units.

The property owners and guarantors are Ai Guang Chen and Jin Wu Yu, according to the complaint. The case 725426/2020 was filed yesterday in Queens County State Supreme Court.

Filings in State Supreme Court are made by one party and may or may not be accurate. The guarantors have not yet filed a response.

The investor filing to foreclose is BK 38th Lender LLC, an entity registered at the law firm Wachtel Missry. The entity also owns loans on three other properties and in February and March of 2020 filed to foreclose on those three loans in Brooklyn secured by 1351 DeKalb Avenue, 1010 Bushwick Avenue and 153 Erasmus Street.

At Shirokia, The prior lender was S3 Capital through its S3 RE 38th Funding LLC, which provided $18 million in January 2019. One year later, in January 2020, that loan was assigned to BK 38th Lender LLC.

A collateral assignment of that loan was recorded in February 2020 with the Madison Realty Capital as lender.

The lender claims it provided a forbearance agreement that was later amended three times this year, but in October sent a letter announcing the loan was in default.

The Shirokia tower has had a troubled history. New building plans were filed in 2005 and the city gave the building its initial temporary certificate of occupancy in November of 2008, just after the collapse of Lehman Brothers and the onset of the Great Recession.

Over the next decade, there were three bankruptcy filings tied to the property, with the building being sold in August 2017 for $25 million.

A lawsuit filed in March 2020 alleged that there was a forged signature in that 2018 transfer.