Finance  ·  CMBS

Two Ark Partners-Owned Hotels in Special Servicing


Two Manhattan hotels owned by New York-based Ark Partners have been transferred to special servicing, according to data from Trepp and Real Capital Analytics.

The $19 million loan for the Mansfield Hotel, at 12 West 44th Street, and the $33.9 million loan for the Shoreham Hotel, at 33 West 55th Street, were moved to an unspecified special servicer last month, according to data from the real estate analytics companies.

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Both securitized loans were originated by LNR Partners, according to RCA.

The Mansfield loan was moved due to “imminent monetary default,” as well as a dispute between owners and managers, the servicer noted in Trepp’s data.

The second loan is not in default, but ownership is unable to pay operating expenses due to the cost of debt service, according to Trepp. The borrower is requesting “ground lease in lieu of foreclosure,” for that property, meaning that the land beneath the hotel could hit the market soon.

John Yoon, a principal at Ark, declined to comment and hung up on Mortgage Observer when asked why the loans had been transferred to the third-party handler.

The loans are relatively small for the world of Manhattan commercial estate, one industry insider noted. As CMBS loans are non-recourse, the properties will likely be sold off to pay back bondholders without any financial detriment to the borrower, which boasts that it is developing three other hotels in Manhattan at the moment on its website.

The loss to bondholders will likely be minimal, if there is any loss, the insider noted, because prices for Manhattan properties are in an almost unprecedented upswing.