Freddie Mac, Sabal file $54.7M more pre-foreclosures at Mack rentals, likely more to come

Freddie Mac and Sabal Capital Partners, on behalf of the securitized bondholders of Series 2019-SB63, filed 12 additional pre-foreclosure actions against Mack Real Estate Group totaling $54.7 million on East Harlem properties formerly owned by Emerald Equity Group. The new cases were filed on June 3 and June 4 in New York State Supreme Court.

The new filings included the properties 1575 Lexington Avenue, 1571 Lexington Avenue, 423 East 114th Street, 139 East 110th Street and 102 East 116th Street.

These new complaints are on top of 10 pre-foreclosure filings totaling $47.9 million against Mack Real Estate Group rentals, which were filed on May 31.

Mack took control of this large portfolio that has $189 million of debt originated in December 2018, from Emerald Equity Group, according to documents dated January 2023. There will be additional foreclosure filings on the portfolio, according to a PincusCo analysis of the original portfolio, which indicates there is nothing notably unique or different about the ones that have been foreclosed on compared with those that have not yet been.

Emerald Equity Group purchased these 12 buildings as part of its purchase of a 47-building portfolio known as the Dawnay Day portfolio, from Fairstead and E&M Associates, for $357.5 million, financed with a loan valued at up to $300 million from Brookfield Asset Management.

A large portion of that portfolio totaling 39 building was refinanced in December 2018 with a $189 million originated by Sabal Capital Partners through the Freddie Mac Small Balance Loan Program (SBL) which packaged it into a security. Freddie Mac is the master servicer, and Sabal Capital Partners is sub-sub-servicer.

Direct link to the property’s ACRIS page.