The lender behind a distressed condominium in the South Street Seaport is seeking to seize more than $ 100 million in property-related loans and strip the developer of the property.
Bank Leumi USA wants to seize the $ 120 million in loans it gave to developer Fortis Property Group to build a 60-story luxury residence at 161 Maiden Lane.
The bank first attempted to sell the debt in October, saying Fortis defaulted on its loan repayments in June. But without a buyer, Leumi wants the government to sell the building, “in order to get the best return on the sale, whether it is sold together as a single plot or sold separately in two or more plots,” the lender said. in a complaint filed. last week in the New York State Supreme Court.
Leumi says $ 99.9 million of her $ 120 million line of credit has been extended through mortgages, notes, credit agreements and loan agreements. The residential tower remains unfinished and the lender argued that as Fortis was unable to obtain a temporary occupancy certificate, it was unable to sell the remaining apartments.
Fortis sued its lenders in October, alleging that the construction loan was $ 30 million less than its total amount and that the group of lenders, led by Bank Leumi USA, had not funded the loan since March 2019. The developer also said lenders are needed to provide funds in the event of budget issues or construction delays.
Representatives for Fortis and Bank Leumi USA did not immediately return a request for comment.
A potential sale of the property would deprive Fortis of its ownership of the building and could mark the final chapter in the property’s long and eventful history.
A construction worker died while working on the project in 2017, for which a subcontractor pleaded guilty to manslaughter. After a crane operator sent a concrete bucket crashing down to the 34th floor the following year, concrete spilled onto the street below.
And in 2019, Fortis and contractor Pizzarotti exchanged lawsuits over the misalignment of the building three inches to the north, which tipped it over.