A Philadelphia apartment building with a history of controversy has had its debt transferred to a special servicer.
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The owner of 1427 Germantown Ave. in Olde Kensington owes $16M on a collateralized loan obligation, and the property has been listed for sale. The CLO was set to mature in January, according to documents cited by Cred iQ. The troubled loan was reportedly put into the hands of special servicer Rialto Capital after the owner failed to keep current on payments.
Part of a two-building development known as Fishtown Flats, the 85-unit building was valued at nearly $24M upon completion, according to Cred iQ. The building’s most recent commercial permit was issued in 2023 and is held by developer Greenpointe LLC.
The property and its sister building at 1413 Germantown Ave. have been listed for sale with Global Real Estate Advisors for a total of $32M. Built in 2019 and 2020, the two-building apartment complex totals 135 units.
Bisnow was unable to reach Greenepointe principal Gagandeep Lakhmna, and numbers for all three LLCs linked to 1413 and 1427 Germantown Ave. had been disconnected. Lakhmna is the original mortgage signatory on the property, records show.
Lakhmna has a lengthy history of lawsuits, tenant disputes and accusations of contractor nonpayment in Philadelphia and elsewhere, according to a Google search that turned up more than a dozen news articles outlining issues with the developer.
This past summer, Lakhmna’s Greenpointe Construction was accused of not paying workers at a Nashville, Tennessee, apartment project on a site purchased for $5.5M, a record per SF, according to the Nashville Scene.
Lakhmna’s history in Philadelphia goes back years and includes multiple lawsuits, being held in contempt by a judge for skipping court, tenant complaints and protests of proposed projects, among other troubles.
Famous for taking buyers to tour condos since lost to foreclosure in a stretch limo in the early 2000s, Lakhmna kept a lower profile in the years that followed, The Philadelphia Inquirer reported. But his reputation took a hit when he evicted more than two dozen tenants in 2021, allegedly keeping their rents. Those tenants were residents of the Moscow and Monica apartments, since rebranded as Fishtown Flats.
The Fishtown Flats project was dogged by controversy from the beginning.
As plans got rolling in 2017, the city’s design review committee and community members greeted it with concern. Issues started when the paperwork submitted for the building was deemed insufficient for a complete streets review, WHYY reported at the time.
Local architect Cecil Baker publicly opposed the proposed six-story building design, calling it “oppressive.”
“For me, this is not putting into play a Philadelphia that we love,” Baker said at the time. “It truly is cramming too much on this lot. Something is not right in the state of Denmark.”
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