Flushing rentals worth $42.5M placed in bankruptcy

Two Flushing rental properties valued at $42.5 million owned by entities controlled by investor Xiangyu Cao filed for bankruptcy protection in two separate actions in the Eastern District of New York. Both properties are being foreclosed on by their secured lender, Mohammad A. Malik.

In the larger filing, Golden 8 Maple LLC made a single-asset chapter 11 filing. The 64-unit, 63,32-square-foot property at 134-38 Maple Avenue has an estimated value of $22.5 million and liabilities of $26.4 million in secured claims and $1.79 million in unsecured claims from 14 creditors that provided personal loans. The personal loans pay a low 2 percent interest rate. The property is under a receiver’s control. The signatory for the managing member is Xiangyu Cao. The secured lender is Mohammad A. Malik, who provided a loan of $18.3 million in 2018. The debtor was unable to obtain refinancing to satisfy Mohammad A. Malik’s secured loan. The secured debt on 134-38 Maple Avenue is $18.3 million and with default interest rate of 24 percent totaling $8.08 million, so that the total debt is $26.38 million. The filing says the $22.5 million value was established by a “potential transaction.”

In the second filing, Maple 888 Golden Tower LLC made a single-asset chapter 11 filing. The 49-unit, 33,490-square-foot property at 134-37 Maple Avenue has an estimated value of $20 million and liabilities of $14.59 million in secured claims and $1.79 million in unsecured claims composed of personal loans from 17 individuals. The property is expected to be under a receiver’s control soon. Signatory for owner is Xiangyu Cao. The secured lender is Mohammad A. Malik who provided an $11.05 million loan in 2018. The debtor was unable to obtain financing to satisfy Mohammad A. Malik’s secured loan. The secured debt on 134-37 Maple Avenue is $11.05 million and with default interest rate of 24 percent totaling $3.54 million, the total debt is $14.59 million. The gross revenue for 2019 was $1 million, which dropped to $801,000 in 2020. So far this year, it has taken in $524,575. Cao owns a 52 percent stake, Jijiang Zheng owns 30 percent, Fukun Zhao owns 8 percent and Xinying Liu owns 10 percent.