NEW YORK CITY-DelShah Capital LLC, a Manhattan-based investment and debt acquisition firm specializing in distressed assets, has resolved two formerly bankrupt New York City properties in Harlem and Midtown, the company announced in a statement. The two sites—101 W. 126th St. and 639 W. 46th St.—will be repositioned and brought back to the market after the firm successfully worked out the troubled deals.
“Every distressed opportunity is different, and success is defined in different ways,” says Michael Shah, principal and CEO of DelShah Capital, in a statement. “Here are two examples of positive outcomes from bankruptcies completed in the past year in which the end result was ownership of the asset and great returns on our credit investments.”
In Harlem, DelShah purchased the 32-unit multifamily building at 101 W. 126th St. through a New York State Bankruptcy Court ordered sale for $11.24 million. In 2010, a DelShah affiliate purchased the non-performing senior mortgage note for the apartment building. In May 2011, DelShah purchased the property when the debtor declared bankruptcy. DelShah was able to reach agreement with the debtor and junior creditors, resolve the bankruptcy and take title in nine months, according to the company.
From March 2011 to now, DelShah’s management arm undertook a full renovation to the building, including improvements to 50% of the apartment units. Prior to the property workout, the property was at 60% occupancy under the control of a court appointed receiver, but it is now fully occupied with an increase in the rent roll from $635,000 to over $1 million annually, the statement says. The commercial space has been leased to Sun of May, LLC for use as a food and beverage venue scheduled to open in Spring 2012.
At 639 West 46th St., the former home of H & H Bagels, in Manhattan, DelShah Capital purchased the senior note in May 2010 and began a foreclosure on the building. Helmer Toro, the building’s owner, then filed for bankruptcy. DelShah and other creditors converted the case into Chapter 7 liquidation. In February 2012, the property was sold to the second mortgagee MKF Management and DelShah Capital received payment in full on its senior lien position, inclusive of default interest at 24%.
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