Korean trust alleges $25M mezz loan tied to NoMad hotel was not repaid

A Korean trust managed by a South Korean bank alleges a $25 million mezzanine loan given for Moin Development’s Mondrian hotel project at 444 Park Avenue South in NoMad, Manhattan, was not repaid and now nearly $37.4 million is owed. David Moinian lost the property in foreclosure last year.

Case LINK

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

NongHyup Bank, as trustee for Fidelis Global Private Real Estate Trust No. 1, claims the trust provided a $25 million mezzanine loan as part of a 2019 funding package that also included a $110 million loan from KeyBank. Eyal Ofer’s Global Holdings Management Group bought that $110 million senior debt, and foreclosed on that loan and took title to the hotel through a deed-in-lieu. The trust says it has not been repaid and David Moinian owes $37.4 million. Typically, the more junior debt is wiped out in a foreclosure, but in some instances guarantees remain.

The foreclosure transfer gave a contract date of September 30, 2022. Global Holdings through Eyal Ofer’s family office Feoh Capital, bought the note on June 8, 2021, then filed to foreclose on the loan in September 2021.

The complaint alleges several defaults, “One such default occurred when Moinian and the borrower entities under his control improperly conveyed the Property to non-party Mortgage Loan holder, Feoh Capital, LLC (“Feoh”) pursuant to a deed-in-lieu of foreclosure on or about July 5, 2023. That impermissible transfer and change in control of the Property violated Section 15.1.1 of the Mezzanine Loan Agreement, in turn violating Section 3.1.6 of the Mezzanine Guaranty, thereby triggering a Springing Recourse Event and Moinian’s immediate repayment obligations to Plaintiff… Moinian never responded to the above described demand letters, and he has not otherwise repaid any of the amounts due and owing to Plaintiff under the Mezzanine Loan and Mezzanine Guaranty…. Plaintiff, thus, brings the instant action to enforce Moinian’s repayment obligations to Plaintiff, specifically including the immediate payment of all amounts now due and owing under tthe Mezzanine Loan and Mezzanine Guaranty—totaling no less than $37,384,261.The “Mezzanine Borrower” entities are 444 Mezz Sub LLC (“Mezzanine Borrower 1”) and A & L Mezz Sub LLC (“Mezzanine Borrower 2”; with Mezzanine Borrower 1, the “Mezzanine Borrower”).

Direct link to the property’s ACRIS page.