Billionaire developer Charles Cohen finally got the $187M monkey off his back.
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Cohen satisfied his outstanding balance with Fortress Investment Group, paying off a $187.3M judgment, plus interest and attorney's fees, according to court filings.
“Charles Cohen has always honored his personal obligations,” Cohen Brothers General Counsel David López said in a statement. “The pay-off of the outstanding balance of the Fortress judgment is consistent with Mr. Cohen’s integrity and confirms his character as an honorable businessman.”
Fortress, his longtime lender, pursued Cohen for a personal guarantee after it foreclosed on a $534M loan it originated in 2022 and the resulting auction didn't satisfy the outstanding debt. It accused Cohen of stonewalling the repayment process for months by trying to only sell the weaker parts of his portfolio, while Cohen claimed Fortress' attempts to appoint a receiver would result in a “catastrophic shutdown” of his family firm, Cohen Brothers Realty Corp.
It is not clear how exactly Cohen came up with the final sum. He sold office buildings 623 Fifth Ave. and 3 E. 54th St. to Vornado last year for a combined $359M, but those generated only $52M of proceeds to Fortress, the lender said in a court filing earlier this year.
This month, Cohen sold two pieces of land in Manhattan to Empire State Realty Trust for a combined $110M.
Fortress' attorneys told a state judge on Thursday that Cohen had paid his $187.3M debt in full, even though it pointed out that it never received details of the real estate transactions before they closed “despite repeated requests.”
The asset management giant is still pursuing litigation against Cohen for a carry guarantee and over claims he wrongfully shielded his assets. A spokesperson declined to comment beyond its court filings.
Cohen amassed a sprawling, 12M SF portfolio, including properties in California and Florida. But many of his NYC office holdings that are of an older vintage have faced distress and struggled to attract tenants.
Cohen defaulted in May on the $150M loan tied to the Decoration & Design Building, an 18-story showroom property on Manhattan's Upper East Side. Deutsche Bank, acting as trustee for the building's bondholders, filed a foreclosure suit last week. A judge on Monday ordered the building to be placed in the care of a receiver.
CLARIFICATION, JUNE 24, 12:20 P.M. ET: This story has been updated to reflect that current distress in Cohen's portfolio is concentrated to some NYC assets.
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