Soros fund files $145M pre-foreclosure at Eretz Group Midtown West office, retail

A lender affiliated with the billionaire George Soros, Soros Fund Management, alleges the Eretz Group which owns most of the commercial building 224 West 57th Street in Midtown West, Manhattan, through four commercial condominium units, is in a maturity default of a $145 million loan.

The fund filed a pre-foreclosure suit in New York State Supreme Court on April 18, 2024. The Soros Open Society Foundations is located in the building, which is located at the corner of West 57th Street and Broadway.
The Eretz Group, led by Abraham Tallassazan, bought the four units, composed of two retail, one office and the roof unit, from a the Beirut-based M1 Real Estate in 2015 for a total of $217 million, through a $213.2 million condo purchase and a $3.2 million leasehold purchase. The building is known as the Argonaut Building.
Eretz through entities including 224 Sapphire LLC, borrowed $101.3 million at the time, then upped the debt twice, most recentlty to $145 million from Aareal Capital in 2018. The Soros entity, QPTF LLC, bought the debt in November 2023.
Crain’s reported on the foreclosure last week.

Case LINK

The property

The condo building in Midtown West has 127,647 square feet of built space and 43,590 square feet of additional air rights for a total buildable of 141,990 square feet according to a PincusCo analysis of city data. The parcel has frontage of 136 feet and is 141 feet deep with a total lot size of 14,199 square feet. The lot is irregular. The zoning is C5-3 which allows for up to 15 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing.

Development

For the tax lot building, it received its initial certificate of occupancy on June 13, 2013.

Violations and lawsuits

According to city public data, the property has received $2,240 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 26.5 million square feet of commercial and multi-family construction under development in the last two years, which represents 35 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of three of the five commercial properties representing 1,426,818 square feet of the 1,760,344 square feet. The largest owner is Empire State Realty Trust, followed by Feil Organization and then Vornado Realty Trust. There are no active new building construction projects on this tax block.

The surrounding

Within a 400-foot radius of 1770 Broadway, PincusCo identified 26 commercial real estate items of interests occurred over the past 24 months. Of those 26 items, 25 were sales above $5 million totaling $596.5 million. The most recent of the 25 was 217 West 57th 69e LLC which bought one condo unit in the 3,364-square-foot, 180-unit mixed-use building (RM) on 217 West 57th Street for $18.1 million from Smitell LLC on January 5, 2024. One of those 26 items was a loan which Ionian Management borrowed $58 million from First Republic Bank secured by the 206,334-square-foot, 26-unit office building (O4) on 1784 Broadway on September 2, 2022.

Correction: An earlier version of this post used the name Soros Management Fund, but the name is Soros Fund Management.

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