An attorney representing Torchlight did not return a request for comment, nor did an attorney for Harbor Group.
The hotel owner, however, declared bankruptcy and was able to resolve the dispute. Torchlight also attempted to foreclose on a hotel in Miami’s Brickell area.
Since inception, Torchlight has acquired over 25 billion in commercial real estate debt investments and has approximately 4 billion of AuM. In January 2021, the firm took control of a 44-story Times Square hotel after the owner stopped making payments on its mortgage. Torchlight was founded in 1995 to provide investment management services to institutional investors seeking exposure to commercial real estate investments. Manhattan-based Torchlight, led by Daniel Heflin, has about $5.1 billion of assets under management and specializes in distress debt, according to its website. The retail corridor was previously leased to jewelry store Charming Charlie, which filed for bankruptcy in 2017 and again in 2019. In 2020, the Australian firm Brickworks signed a 10-year lease to occupy most of the property. The firm bought the retail portion of the 33-story Fifth Avenue condo tower in 2015 from Thor Equities for $68 million. Harbor Group now has to ink a new deal with Torchlight or lose the property to foreclosure. The judge’s ruling all but ends Harbor Group’s glimmer of hope it could save its property through the legal system. Harbor Group in September filed a motion to dismiss, alleging the mortgage was improperly assigned to Torchlight and the assignment was not properly acknowledged. Torchlight alleged it was owed additional money from Harbor Group, including over $1.4 million for making “protective advances” to the property’s temporary receiver. Torchlight’s debt fund then purchased the loan from CIBC in March and replaced the bank as a plaintiff in the suit. Canadian bank CIBC initially filed a lawsuit in September 2020, alleging Harbor Group defaulted on its $40 million loan and failed to keep the minimum reserve balance. Harbor Group has been battling the foreclosure for over a year. A New York Supreme Court judge denied Harbor Group’s motion to dismiss a lawsuit from Torchlight Investors, giving Torchlight the green light to proceed with a foreclosure on the retail space at 445 Fifth Avenue. Harbor Group International is one step closer to losing its Fifth Avenue retail property. Torchlight scores win to foreclose on Fifth Avenue retail property
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