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A developer already fighting off lenders in Lower Manhattan has been handed a foreclosure notice on a development site in Brooklyn's Cobble Hill neighborhood.
Madison Realty Capital has begun UCC foreclosure sale proceedings against Fortis Property Group for the $47.7M it loaned the developer for its River Park development, The Real Deal reports.
Fortis wants to redevelop the former Long Island College Hospital portfolio, the first phase of which is three residential buildings dubbed 1, 2 and 5 River Park. Ultimately, the River Park master plan calls for five residential buildings, according to the website. The sale for the equity interests for two of the buildings spanning 150 units is set for Sept. 29, per TRD.
Fortis paid $240M for the 18-building Brooklyn site back in 2015, winning a bidding process a year after the state closed the financially struggling LICH. After disputes over rezoning, Fortis elected to move ahead with by-right development in 2016 — without any affordable housing included, according to Curbed. Sales for 1 River Park launched in 2019, and a two-bedroom asking $2.5M is currently under contract, per StreetEasy.
Madison is seeking to force the sale of the equity interests in the sites at 350 Hicks St. and 91-95 Pacific St., while 5 River Park — at 374 Henry St. — is not part of the proceedings.
It is not the only Fortis project that is facing pressure from lenders. The company's development at 161 Maiden Lane, infamously dubbed the Leaning Tower of the Seaport following construction woes, has been the subject of battles between Fortis and its lender, Bank Leumi. Earlier this year, the lender was moving to foreclose on the property following the breakdown of mediation talks, TRD previously reported.
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