Foreclosure moves ahead at Billionaires’ Row supertall 111 West 57th Street
Things have been shaky for 111 West 57th Street since it came to light last month that construction on the world’s will-be skinniest skyscraper was stalled at just 20 stories after Property Markets Group‘s Kevin Maloney and JDS Development’s Michael Stern were sued by real estate investment corporation and owner AmBase. Trying to salvage their $66 million investment, Ambase filed an injunction to stop lender Spruce Capital from seizing the $1 billion project, but yesterday a Supreme Court judge ruled that a strict foreclosure could move forward, meaning AmBase will likely lose its majority ownership, according to Crain’s. On the flip side, the developers will now be able to proceed with construction on the 1,421-foot Billionaires’ Row tower, whose units started going into contract earlier this month.
AmBase paid $56 million for a 59 percent stake in the SHoP Architects-designed tower in 2013, eventually increasing to 60.3 percent. However, in 2015, they failed to meet three capital calls for the project, so their stake decreased, and the following year they sued the developers for trying to dilute their stake
Another lawsuit came about in July, with AmBase claiming Maloney and Stern were responsible for $50 million in cost overruns after omitting from the budget the hefty cost of cranes. Though this suit is still ongoing, yesterday’s ruling gives PMG and JDS the option to either transfer ownership to Spruce Capital or bring in another partner to recapitalize the project.
[Via Crain’s]
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