Los Angeles-based lender 8th Bridge Capital through the entity Manhattan Real Estate Fund LP filed a $19.5 million action on November 9, 2023, against developer David Paz and his Omnia Group, which developed the Sister City Hotel at 225 Bowery in the Lower East Side, in Manhattan. The lender is seeking repayment of the loan.
The property is now operating under the name Untitled at 3 Freeman with an address of 3 Freeman Alley.
The building has been the subject of at least five major court actions including a bankruptcy filing that David Paz filed and another action investor Northwind Group filed. An affiliate of Northwind Group bought the $68 million defaulted senior loan on the property in April 2023.
Court filings represent the position of one party and are not necessarily accurate or complete.
8th Bridge Capital alleges it provided $20 million in 2015 to David Paz and Omnia Group for the Sister City Hotel at 225 Bowery. 8th Bridge Capital claims the $20 million was part of a total investment of more than $25 million, according to a 2019 post on the company website.
David Paz, who owns Omnia Group, which partnered with Northwind Group to own the 200-room hotel at 225 Bowery, filed for bankruptcy protection for his entity 225 Bowery LLC. Nat Wasserstein is the chief restructuring officer who filed the petition. David Paz filed the petition following a $10.4 million arbitration judgment owed to the Ace Group. The hotel had previously been operated under the Sister City hotel brand, which is part of the Ace Group collection.
Ace won the arbitration in September 2022, and on October 3, 2022, Ace filed a case in New York State Supreme Court seeking to confirm that award, and later that month, a judge did just that. On October 28, 2022, a judgment for $10.4 million was entered.
This bankruptcy seeks to block or mitigate that transfer. According to the petition, “The Transfer was made while the Plaintiff was insolvent. Plaintiff is entitled to the presumption of insolvency for the Transfer made during the Preference Period pursuant to 11 U.S.C. § 547(f).”
Direct link to the property’s ACRIS page.