The litigation over the destiny of a prized Midtown workplace constructing is getting uglier by the day.
After Aby Rosen’s RFR Realty filed a lawsuit this summer season concerning the foreclosures public sale of 285 Madison Avenue, purchaser Ocean West Capital Companions responded final week, Crain’s reported.
“This litigation is a shakedown,” the agency mentioned in a movement filed to the New York state Supreme Courtroom. Rosen declined to remark to the publication following the movement.
Ocean West is referring to a lawsuit RFR filed in July in opposition to Korea-based lender KTB CRE Debt Fund No. 11, aka Daol Asset Administration. RFR claimed the April public sale of the 27-story property was a “charade” and “rigged.”
The lawsuit claimed the lender sabotaged Rosen’s efforts to retain or refinance the constructing by mismanaging the public sale, chopping off profitable administration charges and imposing what RFR referred to as a “notably unreasonable” $500,000 deposit requirement to take part.
The Class A Madison Avenue constructing, developed in 1926, was 86 p.c leased in 2017 with tenants like Basic Electrical and PVH. That yr, Rosen refinanced a $270 million mortgage and extracted $127 million in money whereas taking over $120 million in mezzanine debt.
When the CMBS mortgage matured in 2022, RFR was granted an 18-month extension. However the agency was unable to pay after the second deadline hit. After a foreclosures submitting earlier this yr, KTB scheduled an public sale for April. Rosen made a last-ditch enchantment in court docket that morning, saying he wanted extra time to search out an investor.
The decide didn’t go for it, although. Solely KTB and RFR confirmed as much as bid. KTB took possession of the property for $132 million. The lender then rotated and offered the constructing to Ocean West.
Rosen’s lawsuit accused KTB of failing to market the property correctly and interfering with RFR’s enterprise by terminating its administration contract, costing the agency $4 million in annual charges. KTB disputed the claims, noting the sale was marketed broadly and that RFR complained a couple of lack of transparency earlier than even requesting sale supplies.
Rosen is searching for unspecified damages. The constructing, a number of blocks from Grand Central and 96 p.c leased as of final February, was reappraised at $300 million final summer season. Ocean West is planning investments, together with a rooftop deck and a gymnasium.
Learn extra
Aby Rosen contests “charade” foreclosure auction of 285 Madison
RFR loses 285 Madison to Korean lender
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