Cohen Brothers’ $182M CMBS Loan on 3 Park Avenue Hits Special Servicing
The 41-story, 360K-SF mixed-use office property has seen its occupancy fall to 54%
By Brian Pascus October 17, 2024 2:22 pm
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Cohen Brothers Realty’s office problems continue.
The $182 million commercial mortgage-backed securities (CMBS) loan secured by 3 Park Avenue — a 41-story, 360,000-square-foot mixed-use office property in Midtown Manhattan — has been transferred to special servicing, according to Morningstar Credit.
The $182 million loan is split across the BMARK 2019-B9, BMARK 2019-B10 and GSMS 2019-GC38 CMBS conduit deals.
“The loan has been delinquent off and on over the course of its term, and the property has long struggled to improve its high vacancy,” wrote Morningstar Credit analysts.
Occupancy at 3 Park Avenue fell to 63 percent by the end of 2020, and most recently sat at 54 percent in March 2024.
Built in 1974 and designed in the brutalist style by the same architects who envisioned the Art Deco Empire State Building, 3 Park Avenue features condominiums, retail, and offices on floors 14 to 41. The building’s tenants have included Unity Center for Urban Technologies, Manhattan Academy for Arts and Language, Success Academy High School of the Liberal Arts, Murray Hill Academy, and Norman Thomas High School.
Charles Cohen, owner of Cohen Brothers Realty, has seen his real estate portfolio struggle since COVID-19 permanently disrupted the office market beginning in 2020.
The Real Deal reported last year that Cohen was delinquent on loans collateralized by 3 Park Avenue, 222 East 59th Street, 750 Lexington Avenue and 979 Third Avenue. Moreover, for the better part of the last year, lender Fortress Investment Group has been pursuing a $534 million UCC foreclosure against Cohen for failure to repay loans secured by properties across several states.
Last week, a New York Supreme Court judge awarded Fortress the right to collect a $187 million personal guarantee Cohen signed to secure financing from the lender, according to The Real Deal. Cohen said he would appeal the decision.
Cohen Brothers Realty did not respond to requests for comment on 3 Park Avenue.
Brian Pascus can be reached at bpascus@commercialobserver.com
