Allen Gross’ GFI Capital mentioned it’d miss its subsequent cost on a portion of its Israeli bonds if it can’t restructure its debt.
A British Virgin Islands firm tied to GFI disclosed in a submitting on the Tel Aviv Inventory Trade on Aug. 10 that it won’t have the funds to satisfy its principal and curiosity funds on practically $60 million of bonds maturing on Dec. 1.
The corporate, which owns the historic Beekman Lodge in Manhattan, is asking bondholders to grant it a three-year extension on the bonds’ maturity date. GFI mentioned it would repay bondholders 50 p.c of the principal by Dec. 1 if it may well safe a refinance for its struggling Seville NoMad lodge.
GFI disclosed the information in filings this month on the Tel Aviv Stock Exchange. The New York Metropolis-based agency grew to become the most recent American developer to run into hassle in Israel prior to now few months. Simad, the proprietor of 30 summer season camps, disclosed it will miss payments and additional revealed that about $34 million from Simad was diverted to the homeowners. Kohan Retail Funding Group, an organization identified for purchasing up distressed malls, lately found that hundreds of thousands of {dollars} in firm loans have been diverted to its CEO. Kohan has denied he misused cash.
Not like Simad or Kohan, GFI shouldn’t be dealing with allegations it diverted or misused bondholders’ cash. GFI’s monetary challenges stem from the poor efficiency of the Seville, previously often known as the James Hotel. The corporate blames this, partially, on a decline in worldwide tourism attributable to the battle with Iran. GFI has raised cash on the Israeli bond marketplace for over a decade by six separate bond raises and has beforehand repaid its Israeli bond choices.
Globes first reported the information.
The Seville’s occupancy fell to 51.2 p.c within the first quarter of 2026 from 64.6 p.c within the first quarter of 2025. It posted an working lack of $1.21 million within the first quarter in comparison with a lack of $423,000 in the identical interval in 2025, in response to Tel Aviv Inventory Trade filings. The corporate additionally reported a detrimental working capital of $224 million within the first quarter.
However GFI mentioned in a submitting that it’s engaged in constructive talks with its senior lender, who’s fascinated about extending the $136 million senior mortgage by three years. As an added incentive, GFI is providing bondholders a lien on the ritzy Beekman Lodge as collateral. GFI can pay curiosity of 9 p.c semiannually to bondholders through the proposed extension, up from 8.75 p.c.
The market didn’t react positively to GFI’s proposed restructuring; the corporate’s bonds fell 25 p.c this month.
GFI didn’t return a request for a remark.
GFI owns numerous lodge and apartment properties in NYC, together with the Ace Lodge New York and Ace Hotel Brooklyn, the ONE11 Residences at Thompson Central Park, and 144 North eighth Avenue in Williamsburg.
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