Fillmore Capital Partners filed a $21.1 million suit Monday in New York State Supreme Court against Mark Hotel developers Simon Elias and Izak Senbahar of the Alexico Group, alleging the two defaulted on a mezzanine loan at hotel on the northwest corner of Madison Avenue and 77th Street, according to an article yesterday by David Jones at threrealdeal.com.
The suit claims the two developers guaranteed repayment of a $25.8 million mezzanine loan from Dublin, Ireland-based Anglo Irish Bank in 2006, and acquired by San Francisco-based Fillmore in May 2007. The loan, amended in December 2007, allowed the developers to borrow up to $43.28 million and some of the funds advanced towards the project, leaving a balance of $38.5 million, as of April 2009. Fillmore says the borrowers waived their rights to make any claims against the lender, and agreed to guarantee the lesser of $7.75 million or the unpaid balance of the loan. Fillmore says the loan came due in December 2009, and a default notice was sent in February 2010, but the loan was not repaid.
"A demand for payment was sent earlier this month, on March 10. The total amount due is the premium balance of $7.75 million plus $3.3 million in guaranteed interest, $8.3 million in default interest and a late payment premium of $1.7 million," the article said.
"Anglo Irish Bank put the loans for the Mark and two other Alexico hotels up for sale in the spring of 2010 for more than $350 million. After opening in January 2010, at least four buyers filed suit against Alexico to back out of their contracts at the hotel. The developers had originally planned to sell 42 residences, but were forced to scale that back to 10 due to a lack of demand. By August 2010, Alexico had entered talks with Dune Real Estate on a deal to restructure the debt and later entered talks with Goldman Sachs on a deal to rescue the project. The developers filed a $1 billion lawsuit against Anglo Irish Bank earlier this year, alleging the lender sold the loans at the Alex, at 205 East 45th Street, and the Flatotel, at 135 West 52nd Street, to a competing development firm, which Alexico called a breach of contract. Anglo Irish denied the allegations in court documents and earlier this month filed a motion to dismiss the charges, according to attorney Aaron Rubinstein, a partner in the litigation department at Kaye Scholer, who represents Anglo Irish," the article said.
Earlier this month, Dune agreed to pay $190 million for the Mark Hotel's mortgage, which had a face value of about $300 million, the article continued, adding that a court hearing on the Fillmore case is scheduled for May 3 in Manhattan Supreme Court.
The suit claims the two developers guaranteed repayment of a $25.8 million mezzanine loan from Dublin, Ireland-based Anglo Irish Bank in 2006, and acquired by San Francisco-based Fillmore in May 2007. The loan, amended in December 2007, allowed the developers to borrow up to $43.28 million and some of the funds advanced towards the project, leaving a balance of $38.5 million, as of April 2009. Fillmore says the borrowers waived their rights to make any claims against the lender, and agreed to guarantee the lesser of $7.75 million or the unpaid balance of the loan. Fillmore says the loan came due in December 2009, and a default notice was sent in February 2010, but the loan was not repaid.
"A demand for payment was sent earlier this month, on March 10. The total amount due is the premium balance of $7.75 million plus $3.3 million in guaranteed interest, $8.3 million in default interest and a late payment premium of $1.7 million," the article said.
"Anglo Irish Bank put the loans for the Mark and two other Alexico hotels up for sale in the spring of 2010 for more than $350 million. After opening in January 2010, at least four buyers filed suit against Alexico to back out of their contracts at the hotel. The developers had originally planned to sell 42 residences, but were forced to scale that back to 10 due to a lack of demand. By August 2010, Alexico had entered talks with Dune Real Estate on a deal to restructure the debt and later entered talks with Goldman Sachs on a deal to rescue the project. The developers filed a $1 billion lawsuit against Anglo Irish Bank earlier this year, alleging the lender sold the loans at the Alex, at 205 East 45th Street, and the Flatotel, at 135 West 52nd Street, to a competing development firm, which Alexico called a breach of contract. Anglo Irish denied the allegations in court documents and earlier this month filed a motion to dismiss the charges, according to attorney Aaron Rubinstein, a partner in the litigation department at Kaye Scholer, who represents Anglo Irish," the article said.
Earlier this month, Dune agreed to pay $190 million for the Mark Hotel's mortgage, which had a face value of about $300 million, the article continued, adding that a court hearing on the Fillmore case is scheduled for May 3 in Manhattan Supreme Court.
Architecture Critic
Carter Horsley
Since 1997, Carter B. Horsley has been the editorial director of CityRealty. He began his journalistic career at The New York Times in 1961 where he spent 26 years as a reporter specializing in real estate & architectural news. In 1987, he became the architecture critic and real estate editor of The New York Post.
6sqft delivers the latest on real estate, architecture, and design, straight from New York City.
