Vornado Chasing Collapsed Hedge Fund Archegos For $160K In Unpaid Rent
Vornado is suing Archegos Capital Management — the hedge fund that went belly up earlier this year in spectacular fashion — for unpaid rent at one of its Manhattan office buildings.
The firm claims Archegos owes just shy of $160K in unpaid rent at 888 Seventh Ave., Crain’s New York Business reports. It is seeking the rent it says is due, plus interest and at least $50K for attorney's fees. The lawsuit was filed in New York State Supreme Court in Manhattan.
Archegos is certainly not the first tenant Vornado has sued in the past 18 months over rent disputes. At the same building in April, Vornado sued Hongkun USA Real Estate Development, saying the company owed $1.1M in back rent at the property. Vornado also claimed the tenant was refusing to leave the property.
Vornado has also gone after retailers; last August it sued the U.S. Polo Association, claiming the retailer owed more than $1.1M in unpaid rent for space at 1540 Broadway. In the lawsuit, Vornado claimed the company hadn’t paid rent since March 2020.
Meanwhile, the firm is expanding its office holdings in the city. Last week, it announced it would take full ownership of its One Park Avenue office building, paying $158M cash to its joint venture partner, Canada Pension Plan Investment Board. The deal valued the building at $875M.
Archegos, which was the personal hedge fund of billionaire Bill Hwang, collapsed over two days in March. Multiple banks took hits as a result of the implosion, which was a result of Hwang making huge bets on a small group of stocks with the financial institutions' money, collecting fees on the transactions. The Bank for International Settlements, a group of global banks, warned that Archegos could be a harbinger if other large investors overreact to inflationary risks, The Wall Street Journal reported last month.
Total global losses from Archegos reached more than $10B, $5.5B of which came out of Credit Suisse's bottom line, which led to the resignation of several executives. The bank hired a former Goldman Sachs executive to a newly created role of chief risk officer this week, the WSJ reported.