Foreclosure roundup: $42M loan in Midtown East; $9.55M loan in Village; $3.4M loan in UWS

Lenders and special servicers filed three pre-foreclosure actions yesterday in New York City courts. The largest was a special servicer representing securitized debt bondholders on a $42 million loan LoanCore Capital originated and provided to Jack Terzi’s JTRE Holdings in 2017. The debt was packaged into Series 2018-COR3 and sold to bondholders. LoanCore is not a party in this action.

The second largest foreclosure filing was LNR Partners as special services for bondholders of the Series 2019-B10, which contains the $9.55 million loan secured by a commercial condominium at 116 University Place in Greenwich Village. The owner of this property is Charles Dubroff’s KD Sagamore Capital, which recently refinanced unsold condo units at 199 Chrystie Street with a $52 million loan from Urban Standard Capital.

The third foreclosure action was for a loan with an original principal of $3.4 million filed by Hirshmark Capital against the owner of 50 West 91st Street on the Upper West Side.

Court filings are the positions of one party and are not necessarily accurate or complete. In addition, in some instances a foreclosure action must be initiated before a borrower and lender or special servicer can engage in a loan modification. The number of foreclosure filings has risen recently, with nearly $460 million of debt sought in foreclosure filings last month in New York City, on an analysis of loans of $1 million and up.

The JTRE loan was secured by 240 East 54th Street, a multi-level retail property Terzi bought in 2015 for $21 million. The debt grew from $15 million at the time of acquisition to $30 million a year later, in March of 2016. Then about a year-and-a-half after that, LoanCore added an additional $12 million in debt for a total of $42 million. That was securitized and sold to bondholders.

In July 2020, special servicer Midland Loan Services sent a notice of default, and in December 2020, sent a notice of acceleration, declaring the entire loan due, based on the alleged default.

Despite the challenges with this property and others that have entered the foreclosure process, Terzi has also acquired properties in recent years. In April 2021 he acquired 14 Vesey Street for $19 million, which followed on the acquisition of the ground lease for 23 Wall Street, valued at $70 million.