$28M bankruptcy to block receiver at Flushing commercial building

One of the owners of the Flushing commercial building at 33-37 Farrington Street and 34-20 Linden Place valued at $28 million filed a bankruptcy petition in the Eastern District of New York as its lender Sioni Capital seeks the appointment of a receiver to manage the property that is in pre-foreclosure. The petition says the owners are seeking to sell the building through a marketing process.

The 67,197-square-foot property is subject to a mortgage that is in default with a total due of $16 million. The owners including Yong Chun Guo, Henry Lam and Rita Lam, bought the property in 2017 for $20.5 million from a bankruptcy estate, and borrowed $12.975 million from Dime Community Bank at the time. Dime sold the note in April 2022 to Sioni Group, which filed a pre-foreclosure action in February 2023.

The petition was filed by restructuring lead Howard Konicov, who is a managing director of the restructuring group within CFGI, which is a partnership of Carlyle Group and CVC Capital Partners. Yong Chun Guo signed as a member of the ownership.

According to the petition, “The ownership of the Debtor is as follows: (i) 80% by Prince USA Group LLC [Yong Chun Guo] ;and (ii) 20% by Linden Tech LLC (David Wong)…. [As ownership relates to Prince USA Group] I [Konicov] understand that the following individuals are members of this entity: Ching Lam a/k/a Henry Lam; Choy LingLam a/k/a Rita Lam; Yong Chun Guo, and Suet Man Chan. In light of the Lams’ default under various agreements(which obligations were guaranteed by Prince), I understand that Mr. Guo may exercise their voting rights in Prince…. Under the various leases, the Tenants are to pay the Debtor approximately $206,000 in monthly rental payments…Ching Lam a/k/a Henry Lam and Choy Ling Lam a/k/a Rita Lam (together, the “Lams”) are guarantors [on the Dime loan]..The loan provides for payment of interest at a rate of 4.75% per annum, with monthly payments of approximately $74,484.80.14. The loan matures on December 1, 2024 and any unpaid amounts under the loan facility are due in full at that time.15. I understand that the Lams did not make mortgage payments and that, as a result,the loan is in default…As of January of this year, Sioni asserts that the amount owing under the loan is approximately $16.15 million. On May 2, 2023, Sioni moved for an appointment of a receiver over the Premises. The return date of such request is May 24, 2023 … one of the best ways to maximize creditor recovery, and preserve equity value to its members, is to commence a robust marketing and sale process conducted by reputable real estate professionals, which the Debtor is in the process of retaining. ” Sioni filed a pre-foreclosure action 702668/2023  in February 2023.

Direct link to the property’s ACRIS page and link to DOB NOW portal.