Lender files $70M pre-foreclosure at APF’s Midtown West office building

The trustee for a $70 million securitized loan filed a pre-foreclosure action against the owners of the Midtown West office building at 25 West 45th Street, alleging multiple defaults. Kenneth Aschendorf’s APF Properties has owned the building since 2000.

This is the 18th pre-foreclosure larger than $50 million filed in New York City over the past 12 months, according to a PincusCo analysis of foreclosure data.

Wells Fargo as trustee and Rialto Capital Advisors as servicer for Comm 2014-CCRE15 allege the $70 million loan originally provided in December 23, 2013, with a maturity date of January 6, 2024, is in a maturity, payment and a lease termination payment default, among others.

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

Case LINK

According to the complaint, “Borrower failed to timely make the payment due and owing under the Note and Loan Documents for the months of November and December 2023…” in addition, APF missed the August 1, 2023 payment for a lease termination agreement, triggering another alleged default, and finally the loan was not repaid on its maturity date in January.

WeWork entered into a lease termination agreement in 2023 in which it would end the lease in the building and pay APF a total of $2.79 million in a series of payments. As part of the agreement, APF had to remit the monthly payment of the termination fee, $121,139, to the lender. APF, the complaint says, has stopped making those payments.

The current unpaid principal of the loan as of the filing was $64.3 million. Rialto Capital Advisors is servicer of the loan.

APF bought the building in December 2000 from Aby Rosen’s RFR Holding for $32.875 million, borrowing $30 million at the time from Helaba, the German bank.

The property

The office building in Midtown West has 187,567 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 100 feet and is 100 feet deep with a total lot size of 10,041 square feet. The zoning is C6-4.5 which allows for up to 12 times floor area ratio (FAR) for commercial. The city-designated market value for the property in 2022 is $60.1 million.

Prior sales and revenue

The 187,567-square-foot property generated revenue of $10.1 million or $54 per square foot, according to the most recent income and expense figures.

Violations and lawsuits

According to city public data, the property has received one DOB violation and $550 in OATH penalties in the last year.

There were no lawsuits or bankruptcies filed against the property for the past 24 months.

The neighborhood

In Midtown West, The majority, or 75 percent of the 75.9 million square feet of commercial built space are office buildings, with hotel buildings next occupying 14 percent of the space. In sales, Midtown West has the 3rd highest sale turnover among other neighborhoods in the city with $2.6 billion in sales volume in the last two years. For development, Midtown West is the most active neighborhood among other neighborhoods. It had 27.9 million square feet of commercial and multi-family construction under development in the last two years, which represents 37 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of eight of the 27 commercial properties representing 521,840 square feet of the 1,309,332 square feet. The largest owner is Afiaa. There are no active new building construction projects on this tax block.

The surrounding

Within a 400-foot radius of 33 West 45 Street, PincusCo identified 12 commercial real estate items of interests occurred over the past 24 months. Of those 12 items, five were sales above $5 million totaling $125.8 million. The most recent of the five was Major Capital which bought the 13,580-square-foot, five-unit office building (O5) on 560 5th Avenue for $38 million from Riese Organization on December 18, 2023. Of those 12 items, seven were loans above $5 million totaling $209.9 million. The most recent of the seven was Faraj Srour and Joseph Stavrach in which borrowed $101.5 million from Bank of Montreal and Citibank secured by the 118,587-square-foot, 124-unit office building (O6) on 2 West 46th Street and one other property on October 3, 2023.

Direct link to the property’s ACRIS page and link to DOB NOW portal.