Chetrit Organization Faces Foreclosure at 2 Downtown Office Buildings
By Isabelle Durso October 22, 2024 12:52 pm
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Jacob Chetrit’s Chetrit Organization may lose two Lower Manhattan office buildings after lender LoanCore Capital Credit claimed the developer defaulted on roughly $200 million worth of loans, court records show.
In the largest default, LoanCore started foreclosure actions against Chetrit for allegedly not making payments on its $156 million mortgage at 1 Whitehall Street in the Financial District since July 2023, according to the case filed Monday in Kings County Supreme Court Chetrit’s debt matures next month, court records show.
Meanwhile, LoanCore began foreclosure actions against Chetrit at its six-story office building at 428 Broadway in SoHo, where the lender claimed Chetrit defaulted on a $50 million loan that matured in April 2023, according to a court filing Monday.
A spokesperson for LoanCore did not immediately respond to a request for comment, while Chetrit could not be reached for comment. Crain’s New York Business first reported the news.
Chetrit purchased the 21-story 1 Whitehall office building in 2019 from Rudin Management for $181.5 million with LoanCore’s acquisition financing, Crain’s reported.
Despite being home to tenants such as the U.S. Postal Service and research firm Regional Plan Association, the 321,994-square-foot building is still about 40 percent vacant, Crain’s reported, citing CoStar data.
To make matters worse, nonprofit LifeSpire, 1 Whitehall Street’s largest tenant, may leave its 20,000-square-foot office there in May, according to Crain’s.
(Disclosure: Commercial Observer is a tenant at 1 Whitehall Street.)
In the SoHo property, Chetrit bought the building in 2005 for $22.5 million and secured a major tenant in coworking firm WeWork, which signed a 13-year lease for four floors at the space in 2015, Crain’s reported.
But after WeWork’s untimely bankruptcy that made it shutter hundreds of locations around the world, the building has been left vulnerable and has struggled to secure new tenants. As a result, the building now has a 96 percent vacancy rate, according to data from CoStar.
This isn’t the first time Chetrit has faced foreclosure actions on one of his properties. In 2023, the company lost its building at 850 Third Avenue to lender HPS Investment Partners in a deal valued at $266 million, Crain’s reported.
Chetrit’s brother Joseph Chetrit has run into similar problems with his Chetrit Group. The company is facing foreclosure at its development site at 265-275 Cherry Street in the Lower East Side after defaulting on an $8 million loan, as Commercial Observer previously reported.
Isabelle Durso can be reached at idurso@commercialobserver.com.
