$34.75M pre-foreclosure at 60K sf Grand Central office building

Rialto Capital Advisors as trustee for bondholders of the securitized loan Series 2018-C9, filed a pre-foreclosure action against the owners of the 60,000-square-foot office building at 22 West 38th Street in Grand Central, Manhattan.

Northeast Equity Management led by Mitchell B. Modell and Abby Modell and Bert Brodsky’s BEB Capital bought the building in June 2019 from Dalan Management for $60.5 million, and assumed a $34.75 million loan originated in 2018 by Ladder Capital and later securitized into Series 2018-C9.

The complaint does not mention BEB or Brodsky as guarantors. The property is displayed on the BEB Equity website.

According to the complaint, “Borrower failed to pay the full amount due under the Loan Documents on February 6, 2023, and on each Monthly Payment Date thereafter… by letter dated March 16, 2023 (the “Default and Acceleration Notice”), Borrower was notified that “an Event of Default has occurred.”

The office building in Grand Central has 60,000 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 50 feet and is 98 feet deep with a total lot size of 4,938 square feet. The zoning is M1-6 which allows for up to 10 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $13.8 million.

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