New York’s Chehebar family has lost the last of its San Francisco holdings after defaulting on two Union Square properties, according to the San Francisco Business Times.

The family founded the Rainbow fast-fashion chain and later became real estate investors through The Jackson Group. The Chehebars acquired the first two retail floors of the Grace Building at 166 Geary St. and a three-story building at 46 Geary St. in 2014 and 2015 for a combined $67.8M.

The Grace Building, in receivership since 2022, is expected to hit the market in the coming weeks. The three-story building was auctioned off on July 24 to Citigroup Global Markets Realty Corp. for a $4.8M bid.

The Jackson Group had purchased the building for $21.8M. At the time of the default notice in June, the firm was just $258K behind on the loan, but penalties, fees and accrued debt brought the total to $14.4M.

Both properties have seen dramatic valuation drops since their purchase. The Grace Building’s retail floors, appraised at $46M in 2016, fell 62% to $17.3M this year.

Union Square’s retail market has been uneven since the pandemic, with a slew of retail exits, including Old Navy, the Gap and Nordstrom. Saks Fifth Avenue shuttered its flagship location in May.

But the area has gained momentum in the last few months.

Ian Jacobs, heir of the Reichmann real estate family, acquired two Union Square buildings earlier this year, 111 Ellis St. and 200 Powell St. The latter has signed a lease with Pop Mart, set to open later this year.

It joins the Nintendo store, which opened to much fanfare in May. Ross Dress for Less doubled its footprint with a second location at 901 Market St. Bulgari opened a new flagship in the historic 1908 Hastings Building.