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Loan modifications aren’t easy to come by these days, but Jack Terzi’s JTRE Holdings just sealed one nonetheless.
Terzi completed a modification of his $42 million commercial mortgage-backed securities (CMBS) loan on his retail property at 240 East 54th Street late last week, following two years of negotiations, sources familiar with the transaction told Commercial Observer.
The modification included a discounted payoff option and a reduced interest rate through maturity. As part of the deal, Terzi made “a large payment” to pay down the loan and clear up past-due interest, sources said.
The modification was negotiated by Iron Hound Management.
The three-story property, in Manhattan’s Midtown East neighborhood, counts SoulCycle and Blink Fitness as tenants, as well as wellness store Clean Market.
Fueled by the pandemic-related turmoil, the loan fell delinquent in March 2020 when its debt service wasn’t paid. It transferred to special servicer Midland Loan Services in June 2020, per CRED-iQ data, and by April 2022 Terzi was facing foreclosure on the property, The Real Deal reported.
Still, almost four years after the initial delinquency, a loan modification took place last week.
“We are pleased to close on this modification,” Terzi said in an emailed statement to CO. “I’m extremely thankful to Midland and Rob Verrone of Iron Hound, who helped us step by step through a two-year process towards closing on this complex CMBS modification. COVID hit our industry hard and retail properties were one of the most severely impacted. Our relationships with our tenants and lenders are vital, and we all worked together towards the finish line.”
The loan is part of the COMM2018-COR3 conduit CMBS deal, and has a maturity date of Oct. 24, 2027.
Iron Hound officials declined to comment.
Cathy Cunningham can be reached at ccunningham@commercialobserver.com
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