Courts roundup: $6M Elmhurst retail foreclosure; LES tenants object to L+M takeover, more

$6M pre-foreclosure in Elmhurst: An affiliate of the Pennsylvania-based Noble Group filed to foreclosure on a loan with an original principal of $6.1 million, secured by the 16,500-square foot retail property at 82-02 45th Avenue in Elmhurst. James Kwang Lee bought the property in July 1984 and continues to own it. The Noble Group affiliate Central Penn Capital Management bought the note March 30, 2022. The loan has a default rate of 24 percent. “The Mortgaged Property is a low-rise, single story retail commercial building of approximately 16,500 square feet of net rentable area (and building area) situated at the corner of 82nd Street and 45th Avenue in Elmhurst, New York. The Mortgaged Property is master leased to a food hall operator. The perimeter of the main food court area, known as “Hong Kong Food Court”, contains retail units for food vendor sub-tenants. Upon information and belief, most of the sub-tenant units are vacant and unoccupied. Upon further information and belief, the Mortgaged Property generates approximately $60,000.00 in rental income and revenue each month under one or more written leases… By five (5) separate letters dated September 27, 2021, November 16, 2021, April 12, 2022, May 6, 2022, and June 1, 2022 (each a “Default Notice” and, collectively, the “Default Notices”, all of which are attached hereto as Exhibit J), Lender and Lender’s predecessor-in-interest provided notice to Borrower of the occurrence of the Events of Default. As of June 3, 2022, there is no less than $6,490,989.72 due, owing, and payable to Plaintiff under the Loan Documents inclusive of unpaid principal, interest, which continues to accrue…” LINK

Court filings are the position of one party and are not necessarily accurate or complete.

Tenant claims East Village unit should be closer to $248 not $3,400 per month: A long-time tenant alleges his apartment at 36 St. Marks Place in the East Village was illegally deregulated in the 1990s and instead of paying $3,400 since 2017 he should be paying $248 per month. This suit is part of a series of lawsuits challenging landlords over unit deregulations decades ago. “In 1984, the Apartment was registered as rent regulated with the Division of Housing and Community Renewal (DHCR). In 1995, the regulated rent filed with DHCR was $248. In 1996, the rent increased from $248.55 to $1700 – an increase of over 600% The explanation given was vacancy, however, even with the allowable 8.5% vacancy increase and rent guidelines board increase for a one-year-lease (2% plus $20 if the rent if below $400), the maximum allowable rent would have been $294.65.” LINK

LES tenants object to L+M takeover: A group of tenants that are distinct from the Knickerbocker Village official tenants organization sued the New York State Division of Housing and Community Renewal last week, seeking to block a sale to an affiliate of the affordable-focused developer L+M Development Partners, meant to preserve affordability at the complex.  LINK