After Losing 3 Tenants, Chelsea Retail Property's $34M Loan Sent To Special Servicer
The owners of the retail space at 735 Sixth Ave. have fallen behind on their loan payments after losing three of four retail tenants in the past few months.
The $34M loan on the building was marked as 30 days delinquent, according to CMBS tracking service Trepp, and has been transferred to special servicing. David's Bridal, T-Mobile and a nail salon were the top major tenants occupying around 90% of the 17K SF of retail space. All three tenants left after their leases ran out last year, according to Trepp.
The commercial condominium is at the base of a residential building, and is owned by a joint venture of subsidiaries controlled by Hayman Mamiye and Jack Cohen, according to city property records. The partners paid $27.8M for the commercial unit in 2008 and took out a $34M CMBS mortgage from Rialto Mortgage Finance in 2013.
Manhattan’s retail market has struggled in the past few years. Fifteen of the borough’s 17 major retail corridors saw year-over-year declines on the asking rents for ground-floor retail space, according to the Real Estate Board of New York’s fall Manhattan retail report.
The declines are the most widespread since REBNY started running the report 18 years ago. Increasingly, landlords are turning to short-term leases and pop-ups to bring down vacancy in their spaces.
The borrowers reported that the building has restrictions on food service, according to Trepp, hampering their ability to lease the space in the primarily quick-service restaurant stretch of Sixth Avenue in Chelsea.