RFR hit with 6th pre-foreclosure in 2024, this for $180M in FiDi

For the sixth time this year, Aby Rosen and Michael Fuchs’s RFR Holding has been hit with a pre-foreclosure action against one of its buildings. The total original debt for the six actions is $450 million.
The most recent case was filed yesterday in New York State Supreme Court in Manhattan, with special servicer Rialto Capital Advisors for the securitized trust, known as Series 2014-C23, alleging a maturity default for the loan secured by the office tower 17 State Street in the Financial District of Manhattan.
Case LINK
Court filings represent the position of one party and are not necessarily accurate or complete.
Office properties have declined in value and the number of large foreclosures and steeply discounted sales has risen. The day before, a special servicer filed a $670 million pre-foreclosure at RXR Realty’s 230 Park Avenue.

The highest value RFR Holding pre-foreclosure was filed at its 522 Fifth Avenue, which secures a $224 million loan.

RFR Holding bought the building in 1999 for $118.25 million from TIAA according to city property records. Then in from borrowed $180 million in two loans originated by JPMorgan Chase for $98 million and $82 million.  The complaint alleges a maturity default, with the loan not repaid by August 1, 2024. The total balance due is $183,496,856 as of November 1, 2024.

Crain’s reported on the 17 State Street action yesterday.

In addition to pre-foreclosure actions, Blackstone Group alleges a $25 million promissory note remains unpaid.

The property

The office building in Financial District has 544,015 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 227 feet and is 203 feet deep with a total lot size of 23,080 square feet. The lot is irregular. The zoning is C5-5 which allows for up to 15 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $119.5 million.

Prior sales and revenue

The 544,015-square-foot property generated revenue of $30.5 million or $56 per square foot, according to the most recent income and expense figures.

Violations and lawsuits

According to city public data, the property has received $13,555 in ECB penalties and $31,093 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 Financial District, The majority, or 74 percent of the 79.9 million square feet of commercial built space are office buildings, with elevator buildings next occupying 15 percent of the space. In sales, Financial District has the 3rd highest sale turnover among other neighborhoods in the city with $2.3 billion in sales volume in the last two years. For development, Financial District is the 3rd most active neighborhood among other neighborhoods. It had 13.3 million square feet of commercial and multi-family construction under development in the last two years, which represents 17 percent of the neighborhood’s built space.

The block

There are no active new building construction projects on this tax block.

The surrounding

Within a 400-foot radius of 17 State Street, PincusCo identified one commercial real estate item of interests occurred over the past 24 months. It was a loan which Stawski Partners borrowed $51.2 million from Apple Bank for Savings secured by the 365,792-square-foot, 29-unit office building (O4) on 33 Whitehall Street on January 3, 2023.

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