Loan Backed by Lincoln Square Luxury Tower in Default
$225M senior loan on 200 W. 67th Street came due on November 1.
A senior loan backed by the Aire, a 43-story luxury apartment tower in Manhattan’s Lincoln Square neighborhood, was not paid by A&R Kalimian Realty when it came due on November 1.
The $225M mortgage on 200 W. 67th Street was originated by JPMorgan Chase in 2013. According to Trepp, the NYC-based landlord had requested a short-term extension, but the loan has been labeled delinquent and non-performing by the special servicer, LNR Partners.
The $225M senior loan and a $25M subordinate loan were transferred to special servicing in June. Fitch Ratings said during the summer that the debt was at risk of default due to the expiration the Aire’s tax abatement, which resulted in annual property taxes skyrocketing this year to $6.7M.
The 10-year tax abatement ran out in 2017, resulting in tax increases of 20% every two years going back to 2014. The mortgage on the property reportedly had a trigger clause if the debt service coverage ratio at the property dropped below 105x.
The 310-unit Aire, overlooking Lincoln Center, has rents ranging from $3,750 a month for a studio to $11,900 for a 1,500 SF, three-bedroom apartment, according to its website.
Amenities include a private party deck, a fitness center and a courtyard. A half-acre private elevated park features leafy walkways and a reflecting pool. There is 25K SF of ground-floor retail.
Occupancy at the luxury high-rise was 97% in the first quarter of 2023, after dipping to 70% in 2021. A&R Kalimian purchased the land for the Aire on Amsterdam Avenue, formerly the site of the Red Cross, in 2004 for $72.3M.
Earlier this month, Brooklyn-based developer Aview Equities faced a third lawsuit in which a lender claimed unpaid mortgages at an unfinished Brooklyn apartment project.
Lender Parkview Financial filed a lawsuit in Brooklyn Supreme Court against Aview Equities over loans backed by 57 Caton Place totally $66M, according to a report in Crain’s.
Parkview claims in the suit that Aview defaulted on three loans backed by the partially completed 131-unit apartment building. The lender requested that the court appoint a receiver to collect rents ahead of a potential sale.
Aview planned a 130K SF development at the site, which the firm acquired for $7.2M in 2014. The building will include ground-floor retail space and underground parking.