Courts roundup: $8.5M Brooklyn pre-foreclosure, $6M Village pre-foreclosure, $3.8M Bronx suit

Rialto fund files $8.5M pre-foreclosure in Brooklyn: Rialto Capital Management’s debt fund RREF IV-D SN Portfolio, LLC, filed a pre-foreclosure action against the owners of 228 Manhattan Avenue in Williamsburg, 331 Melrose Street in Bushwick, and 1175 Bedford Avenue in Bedford Stuyvesant, with an original principal of $8.5 million. The lender filed the case in Brooklyn State Supreme Court on August 23, 2023. 524532/2023

Court filings represent the position of one party, and are not necessarily accurate or complete.
The ownership of the properties was not immediately clear. Perl Weisz, who often signs for loans given to CW Realty Group properties, was the signatory on the loans. But the owner entities were in care of the the address of Delshah Capital in the East Village. When contacted, Michael Shah, CEO of Delshah, said the firm had nothing to do with these properties. CW Realty did not immediately respond to requests for comment.
According to the complaint, “there is now due and owing by Borrowers and Guarantor to Plaintiff, pursuant to the Loan Documents, the unpaid principal amount of $7,859,148.86 plus accrued and unpaid interest. Delshah and CW Realty Group each own large multifamily portfolios in New York City.

The walkup building at 228 Manhattan Avenue with 7 residential units in Williamsburg has 5,116 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 25 feet and is 100 feet deep with a total lot size of 2,499 square feet. The zoning is R6B which allows for up to 2 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $1.3 million.

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

Unity Capital files $6M pre-foreclosure in Greenwich Village: Unity Capital filed to foreclose on a $6 million loan provided in January 2022 to Arthur G. Lambert Jr. of Gorman Propeties and secured by the five-unit walkup at 33 West 9th Street in Greenwich Village. Unity Capital filed the case on August 23, 2023 in Manhattan State Supreme Court. LINK

Lambert, who was in his 80s, signed for the loan in January 2022 and signed a forbearance in June 2023. Subsequent to that, he died, according to the complaint.

The building has 3,868 square feet of built space and 32 square feet of additional air rights for a total buildable of 3,905 square feet according to a PincusCo analysis of city data. The parcel has frontage of 17 feet and is 92 feet deep with a total lot size of 1,607 square feet. The zoning is R6 which allows for up to 2.43 times floor area ratio (FAR) for residential. The property is in the Greenwich Village Historic District. The city-designated market value for the property in 2022 is $4.3 million. The most recent loan totaled $6 million and was provided by Unity Capital on January 28, 2022.

“On or about June 13, 2023, Lender, on the one hand, and Borrower and Guarantor, on the other hand, entered into a forbearance agreement (the “Forbearance Agreement”) in which Lender agreed to extend the time until August 1, 2023… Borrower has not paid the amounts due… By reason of the foregoing default and the expiration of the Forbearance Period, there is now justly due and owing to Plaintiff, upon the Mortgage, the outstanding balance of $6,340,556.00 as of August 17, 2023.”

Webster Bank sues borrower over $3.8M Bronx loan: Webster Bank filed a lawsuit seeking repayment of a loan with a current alleged principal of $3.79 million, secured by the 25,000-square-foot 830 Barry Street in Hunts Point, the Bronx. According to the complaint,”Barry Street and [Stephen] Werdiger defaulted under the Note, as modified, by failing to make all payments due and owing as of May 1, 2023, the maturity date set forth in the Fifth Note Modification.” This is not a foreclosure, it is a demand for repayment of a loan. However the loan is secured by a mortgage on the property. 812965/2023E