Facing foreclosure at 635 Madison Avenue, a 19-story Midtown office tower with ground-floor retail, Glenn Agre client Ashkenazy Acquisition Corp.—which holds the ground lease of the building—is leveraging a pandemic-era protection for small businesses to maintain the asset.
In July 2020, four months into the Covid-19 pandemic, Ashkenazy Acquisition defaulted on a mortgage at 635 Madison. The loan was transferred to special servicer LNR Partners the next month, and by December, LNR had accelerated the debt. LNR brought a foreclosure action one year later, just before New York’s commercial moratorium on evictions and foreclosures for small businesses expired.
Partner Jed Bergman, counsel for Ashkenazy, argued that the last moratorium extension allowed for the repeal of only “certain provisions” of the act once it expired – and the stay on foreclosures was not one of them. He also claimed that LNR was obligated to contest Ashkenazy’s hardship claim under New York’s commercial moratorium before filing to foreclose on the building.
Jed’s role in this case is featured in The Real Deal, which characterized Glenn Agre’s strategy as “creative.” Read the article here.