PIMCO seeks $7.2M from Sam Chang, others tied to $67.5M Midtown hotel loan

By Adam Pincus

The investment manager PIMCO filed a suit yesterday in New York State Supreme Court seeking $7.2 million from guarantors related to a $67.5 million note lent for the construction of a hotel at 16 East 39th Street in the Garment District.

PIMCO bought the note from Deutsche Bank, PincusCo first reported and the hotel was issued its initial temporary certificate of occupancy earlier this month. 

In addition, construction manager Omnibuild filed a suit alleging it was owed $4.1 million for construction.

The hotel is owned by Chang and his McSam Hotel Group’s affiliate 16 East 39th Street LLC.

The lawsuit is not seeking to foreclose on the loan, instead it is seeking a money judgment for the alleged guaranty obligations.

The defendants including Chang and Samir Gandhi and Manish Patni of M&R Hotel Management, have not responded yet in court papers. The filing, as all court filings, is the position of the plaintiff and is not necessarily accurate or complete.

“Here, there is no dispute as to any components of the Guaranteed Obligations, including without limitation, the $7,209,498.45 in Interest Payment Obligations and Building Loan Carry Costs due pursuant to the Carry Guaranty,” the complaint says.

“By notice dated February 18, 2021 (the “Default Notice”), Lender informed Borrower that Events of Default existed under Section 8.1 of each Loan Agreement by virtue of Borrower’s failure to pay the Maturity Date Payments and June 9 and July 9 interest payments. Aff. ¶ 46 & Ex. Q. By the same notice, Lender informed Guarantors that Borrower’s failure to make the June 9 and July 9 interest payments constitute Guaranteed Obligations under the Carry Guaranty.”

“By notice dated March 12, 2021 (the “March 12 Demand”), Lender informed Borrower that Events of Default are continuing under Section 8.1 of each Loan Agreement…”