Singapore’s UOB Files Case To Foreclose Manhattan Office Bldg
USA – Singapore-based financial firm United Overseas Bank (UOB) has sued to foreclose 5 East 59th Street, a 9-storey office building in Midtown Manhattan where the Playboy Club used to operate, reported The Real Deal on Monday evening (22 November, SGT).
The 46,000 sq ft mixed-use commercial property comes with roughly 11,000 sq ft of retail premises and roughly 35,000 sq ft of office space.
In 2015, the 5 East 59th Street was purchased by a joint venture (JV) comprising Capstone Equities and a company backed by GreenOak Real Estate for US$85 million.
However, the office building, which is situated just north of the GM Building’s pedestrian plaza, is facing foreclosure. In a foreclosure lawsuit filed this week, UOB alleged that the owner has defaulted on 3 loans collateralised by the commercial property.
The biggest of the three is the US$59 million loan granted in 2015 that was used to purchase 5 East 59th Street. The other 2 are construction loans released 3 months later. All 3 debts matured in June 2021, but the borrower failed to repay them, according to UOB, which seeks over US$65 million.
So far, the owner of the commercial property has not responded when asked to comment.
Under New York’s commercial eviction and foreclosure moratorium, which is set to expire by January 2022, certain commercial property mortgage foreclosure actions cannot proceed if a borrower submits a hardship declaration in court. However, the owner of the office building has not done so.
Notably, United Overseas Bank wants the court to appoint CBRE’s Klaus Kretschmann as the mixed-use property’s receiver, while the lender awaits the court’s ruling.
Previously, 5 East 59th Street was acquired at a time when all of its office occupants were to leave by the end of 2015, with its retail tenant leaving soon after. The development came with 22,000 sq ft of development rights, but no construction permit application was filed to utilise it.