Main Photo: The Washington Park Hotel
Date: August 2020
Location: South Beach, Miami, Florida, USA
Name: Washington Park Hotel Hotel
No. of Keys: 181
Owner: Steve Witkoff is the owner of the Washington Park Hotel and Ladder is seeking to collect the entire loan, along with interest and late fees. Private equity giant Carlyle Group is also a partner in the hotel at 1050 Washington Avenue.
In New York, Witkoff Group owns the Woolworth Building, the Park Lane Hotel and the Daily News Building. Over the past few years, it has expanded its presence in South Florida and has an office in Miami’s Design District. Last year, Steve Witkoff, the founder of the development group, purchased a Miami Beach home for $10 million.
Lender: Lender, Ladder Capital, is seeking to foreclose on the Witkoff Group’s South Beach hotel after it alleges the developer failed to make its July payment on a $45 million loan.
The lawsuit was filed on July 22 in Miami-Dade County Circuit Court and is one of the largest foreclosure lawsuits in South Florida since the coronavirus pandemic began.
The boutique Art Deco hotel reopened in 2016 after an extensive renovation.
Ladder Capital provided the $45 million loan to the hotel in May 2016. The New York-based lender sent the company a letter of default on July 7, after it alleges Witkoff failed to make a payment on the loan, according to the complaint. The lawsuit was first reported by the South Florida Business Journal.
Witkoff and Ladder Capital did not immediately respond to requests for comment.
Since the pandemic began in March, a number of lenders have sought to work with borrowers to offer deferrals.
During its second quarter earnings call this week, Ladder said its balance sheet loans had a 98 percent collection rate in July. The exceptions were for one multifamily and one hotel loan, which were either late in payment or going to default. The hotel loan could be for the Washington Park Hotel.
Experts say that lenders are generally reluctant to foreclose on a property now because they are not interested in taking over or finding a replacement tenant or operator. Still, some are filing foreclosure suits. The lender, BridgeInvest, is seeking to foreclose on the 70-key Variety Hotel in Miami Beach.
Ladder Capital, a real estate investment trust founded in 2008 by Pamela McCormack, Robert Perelman and Brian Harris, is perhaps most famous for being a frequent lender to Donald Trump, having provided more than $250 million in debt to entities tied to him over the years.
THPT Comment: We understand lenders are in it for it, for the business….however sometimes they are too quick to step in, on a non-repayment, in these terrible times??
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