Courts roundup: Nightingale, Northwind, Urban Standard bring suits

Nightingale sues Solil over $28M ground lease: Nightingale Properties filed suit asking a judge to restrain Solil Management from taking action to terminate the ground lease at 20 East 46th Street in Midtown. The suit does not provide a monetary amount. Nightingale bought the ground lease for $27.675 million in 2016.

According to the complaint, “Plaintiff is the tenant, and Defendant is the landlord, under a long-term ground lease dated September 4, 1957, as amended, between Landlord’s predecessors-in-interest, as landlord, and Tenant’s predecessors-in-interest, as tenant (the “Lease”), for the land, buildings and other improvements thereon, known as and located at 18-22 East 46th Street, New York, New York 10017 (the “Premises”). A copy of the original Lease and the most recent amendment and assignment is attached hereto as Exhibit 1. 12. The Lease currently expires on September 30, 2043. 13. Tenant has an option to renew the Lease through September 30, 2046. 14. Landlord purported to deliver to Tenant a “Thirty (30) Day Notice to Cure” dated May 17, 2022 (the “Notice”). The cure period in the Notice is set to expire on June 27, 2022. A copy of the Notice is attached hereto as Exhibit 2.” LINK

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

Northwind sues Top Rock over 609 Fifth financing: Northwind Group alleges that Top Rock Holdings, which PincusCo first reported on Friday was the buyer of 609 Fifth Avenue from SL Green Realty for $100.5 million, broke an exclusivity period and entered into a loan deal with Valley National Bank. According to the complaint: “In April 2022, the parties entered into the Term Sheet, under which Top Rock… and the Borrower agreed to be bound by the provisions entitled “Loan Costs,” “Deposit,” “Exclusivity,” “Break Up Fee” and “Confidentiality.” In reliance on the Term Sheet, Lender began the process of securing funds for the Loan and conducting its due diligence on the Project.”
Top Rock declined to comment.
The complaint alleges Top Rock in May 2022 breached the exclusivity by negotiating with other lenders. According to the complaint, “On June 1, 2022, Lender made a demand for payment of, among other damages, the Break-Up Fee and Closing Costs, but Defendants have not paid.”

Northwind is seeking $381,000 for the breakup and and an additional $38 million for lost loan interest, lost opportunity cost, origination fees and other costs. LINK

Urban Standard files to foreclose on $7M loan in LES: Urban Standard Capital filed to foreclose on a loan with an original principal of $7 million provided in April 2019 secured by 171 Bowery in the Lower East Side. There were a large number of extensions and amendments provided to the borrower, moving the original due date of the one-year loan from February 1, 2020 to May 31, 2022.

According to the complaint, “The Loan, pursuant to the Third Amendment to the Forbearance Agreement, matured on May 31, 2022 (the “Extended Maturity Date”). Events of default have occurred under the Loan Documents. Specifically, the Borrower, among other things, (i) failed and omitted to pay the entire debt which came due and owing on the Extended Maturity Date (the “Maturity Default”); (ii) failure to discharge and/or bond the Mechanic’s Lien docketed on December 14, 2021, under Index No. 149, by Kutnicki Bernstein Architects PLLC in the amount of $142,398.75 (the “Mechanic’s Lien Default”); (iii) failing and omitting to keep the insurance policy in full force and effect pursuant to Section 21(c), (the “Insurance Default” and together with the Maturity Default and the Mechanic’s Lien Default collectively, the “Events of Default”), all constituting events of default as defined in the Loan Documents.” There is an additional, subordinate, $4 million loan provided by another party in 2021. LINK

Rialto sues HFZ over $20.5M loan: A Rialto Capital Management affiliate is suing to foreclose on a loan with an original principal of $20.5 million, given to Ziel Feldman’s HFZ Capital. Rialto and HFZ maintain offices in the building 600 Madison Avenue, with HFZ on the 15th floor and Rialto on the 12th. This is for the retail and garage unit in the HFZ-built Halcyon condominium building. HFZ was hit in May 2020 with a condo lien for nonpayment of condo feesLoan payments for April 2020 through October 2020 were deferred. Rialto bought the loan in October 2021. According to the complaint, “Borrower failed to timely pay the monthly payment due on November 1, 2020 and each monthly payment due thereafter (the “Payment Defaults”). Accordingly, an Event of Default has occurred and is continuing under the Loan Documents as a result of, inter alia, the Payment Defaults.” LINK