Aby Rosen's RFR Realty could soon lose one of its signature properties, Park Avenue's Lever House, after falling behind on mortgage payments.
RFR has not been able to secure a refinancing of its $85M mortgage on 390 Park Ave., and three years after the loan matured, its bondholders have moved to foreclose on the property, Crain's New York Business reports. The owners of the debt could take control of the 21-story landmark as early as the third quarter, but RFR said it is in negotiations for a financing lifeline.
"We are in conversation with the lender and working on a resolution," the company told Crain's in a statement. "The fundamentals of the building are strong."
RFR owns the building, but leases the land on which it sits from the Korein family. That lease is set to expire in 2023, according to Crain's, and a renewal would raise the annual payments by RFR — or whoever controls the building at the time — to more than triple the $6M they are now. If RFR is not able to keep its lease, the $85M mortgage on the property would be lost, Crain's reports.
The loan has been transferred to special servicer CWCapital Asset Management, which alleges in foreclosure documents that, after three years of default interest accruing, Rosen's firm owes at least $105M on the originally $85M security.
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