Courts roundup: 5 pre-foreclosure filings totaling nearly $26M in Manhattan, Bronx, Brooklyn

Lenders filed four pre-foreclosure actions yesterday above $3 million, totaling $25.8 million, related to properties in Manhattan, the Bronx and Brooklyn.

Stillwater alleges default on $12.6M Midtown East office building loan: Lender Stillwater Asset Management filed a pre-foreclosure action yesterday in Manhattan against the owners of 226 East 54th Street in Midtown East, based on a technical default. The owner is an affiliate of the Ohebshalom family’s Empire Management.
Court cases are the positions of one party and are not necessarily accurate or complete.
The lender alleges, “the Borrower is in default for failing to maintain the debt service coverage ratio,” and after alleging such a default, the lender claims it “is entitled to ‘commence a cash flow sweep into a designated and restricted account with the Lender . . . .’ The Lender previously made demand for the Borrower to set up a designated account to allow the Lender to exercise the above-described cash sweep remedy available under the Mortgage Loan Note, but the Borrower refused.”
The lender sent a note dated September 12, 2022, declaring the loan in default and declaring the entire balance due. “Despite such demand, the Borrower and the Guarantors have refused, and continue to refuse, to pay all items of principal, interest and other charges, all as more fully appears in Exhibit 9, which is incorporated by reference as if fully set forth herein.”
The office building in Midtown East has 31,105 square feet of built space and 19,130 square feet of additional air rights for a total buildable of 50,210 square feet according to a PincusCo analysis of city data.
The parcel has frontage of 50 feet and is 100 feet deep with a total lot size of 5,021 square feet. The PincusCo database currently indicates that Empire Management owned at least 19 commercial properties with 767,895 square feet, 553 residential units and a city-determined market value of $156.1 million. (Market value is typically about 50% of actual value.) The portfolio has $228.9 million in debt, with top three lenders as New York Community Bank, Santander Bank, and Dime Community Bank respectively. Within the portfolio, the bulk, or 70 percent of the 767,895 square feet of built space are elevator properties, with hotel properties next occupying 17 percent of the space. They are all located in Manhattan.
LINK
Direct link to the property’s ACRIS page and link to DOB NOW portal.

Liberty One Group files $5M Bronx pre-foreclosure: An affiliate of Liberty One Group alleges the $5.1 million loan secured by 1564 St. Peters Avenue in Westchester Square is in a maturity default. The elevator building with 38 residential units in Westchester Square has 34,595 square feet of built space according to a PincusCo analysis of city data. The property is owned by Andrew Gormally. The parcel has two buildings with frontage of 98 feet and is 97 feet deep with a total lot size of 11,782 square feet. “1564 Debt is aware that pursuant to a stipulation and order filed on September 10, 2019 (Sup. Ct., Bronx Co., Index number 28219/2019 E), Borrower’s tenant, 1564 Development LLC(“Tenant”), has been making certain monthly rent/use and occupancy payments to Borrower, a portion of which ($27,082.82) has been paid over to the prior lender. However, the prior lender is not a party to this stipulation, and the Mortgage, as extended, has matured by its terms on July 10, 2022… Borrower is hereby afforded until November 11, 2022, to pay the outstanding principal balance of $5,100,000.00, together with accrued interest and any other charges due thereon.” LINK

NPL Fund files $4.65M pre-foreclosure in Mott Haven: According to the complaint, “this is an action to foreclose that certain Mortgage, Consolidation, Extension and Modification Agreement in the principal amount of Four Million Six Hundred Fifty Thousand and 00/100 ($4,650,000.00) Dollars, encumbering the real property known as: 231 Brook Avenue, Bronx, New York 10454 a/k/a 502/504 East 138th Street, Bronx, New York 10454 (Block: 2265, Lot: 6) (the “Property”), situated in Bronx County.” The walkup building with 32 residential units in Mott Haven has 25,460 square feet of built space according to a PincusCo analysis of city data. The property is owned by Delfino Velez. The parcel has frontage of 65 feet and is 100 feet deep with a total lot size of 6,520 square feet. LINK

Avatar Financial Group files $3.4M pre-foreclosure in Bushwick: According to the complaint: “THE OBJECT of the above captioned action is to foreclose a Consolidation, Extension and Modification Agreement dated October 30, 2019 (hereinafter, the “CEMA”) securing an obligation in the amount of $3,400,000.00, with interest thereon, recorded in the Office of the City Register of the City of New York on November 13, 2019 under CRFN 2019000369959 covering the premises known as 17 Cornelia Street, Brooklyn, NY 11221 (Block 3373, Lot 54) and 1104 Putnam Avenue, Brooklyn, NY 11221 (Block 3373, Lot 17)…” 17 Cornelia has 3 residential units in Bushwick has 3,000 square feet of built space and 1,860 square feet of additional air rights for a total buildable of 4,860 square feet according to a PincusCo analysis of city data. The parcel has frontage of 20 feet and is 100 feet deep with a total lot size of 2,000 square feet. 1104 Putnam has 3 residential units in Bushwick has 3,300 square feet of built space and 1,560 square feet of additional air rights for a total buildable of 4,860 square feet according to a PincusCo analysis of city data. The parcel has frontage of 20 feet and is 100 feet deep with a total lot size of 2,000 square feet. LINK