Weekly Market Report - January 20, 2026
- Broker Support
- 6 days ago
- 9 min read
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In 1970, the Chairmen of the Board's "Give Me Just a Little More Time" resonates with developer Charles Cohen's current plight. Cohen is seeking court permission for additional time to settle a $187 million debt to Fortress Investment Group, citing efforts made over the past 18 months, including selling two properties for $52 million. In a court affidavit, he expressed a need for more time due to adverse media and legal pressures faced from Fortress. However, Fortress opposes this request, arguing for a receiver to liquidate parts of Cohen's 12 million-square-foot portfolio, alleging he has hidden assets, an accusation Cohen denies. Fortress questions Cohen's reliability in managing the sales process.
Cohen has extensive ties to the real estate sector, with notable properties like 805 Third Ave. and the essential Pacific Design Center, asserting that its sale could jeopardize his entire business. Fortress contends that appointing a receiver wouldn't lead to defaults unless initiated by Cohen or affiliated parties, suggesting that selling the design center could yield significant returns to settle obligations efficiently.
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Saks Global, the parent company of Saks Fifth Avenue, has filed for Chapter 11 bankruptcy, creating waves in the luxury retail sector. This comes after an expansion that included acquiring Neiman Marcus and Bergdorf Goodman, and now the company is reassessing its operational properties, which could lead to closures and asset sales. Despite the difficulties, luxury department and off-price stores will remain open due to a $1.75 billion financing package. The firm's struggles have been ongoing since a 2024 acquisition left it deeply in debt.
Already, Saks Global has confirmed plans to close nine Saks Off Fifth stores in various cities and has sold key properties, such as land beneath a Neiman Marcus location in San Francisco. Saks Global manages 71 full-line luxury and off-price stores, with valuable real estate holdings that may become crucial during bankruptcy. The company aims to reduce debt by reorganizing operations and shuttering underperforming stores. Legal actions may arise from landlords concerning leased properties, including requests to close four unopenable “dark stores.” While flagship stores may remain safe, uncertainty looms over locations like Neiman Marcus' Dallas flagship, marking a significant shift in the luxury retail landscape.
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Plus, Mamdani shakes up the industry and more NYC real estate news this week
Marc Holliday's SL Green navigates contrasting realities in Manhattan's office market. At 100 Park Avenue, SL Green showcases strength, selling a minority stake to Rockpoint at a $425 million valuation, following the buyout of Prudential’s 49 percent stake at a $360 million valuation. This $2.5 billion selloff emphasizes management's strategy of cash flow and balance-sheet management rather than a retreat, with the 95 percent leased tower attracting capital despite high interest rates. Conversely, Worldwide Plaza sees SL Green in a contentious legal battle against RXR to prevent a UCC foreclosure, alleging that the auction process designed by Extell Development is unfair.
With only 63 percent occupancy and a decline in valuation from pre-pandemic levels to $345 million, this property presents challenges that rely more on legal strategy than leasing success. Overall, SL Green is strategically liquidating assets where demand remains robust while aggressively defending interests in properties where leveraging control and legal navigation is critical. Concurrently, developments in New York real estate include setbacks for Mamdani's housing policies, ongoing litigation over unpaid bills, and significant awards related to mortgage fraud cases.
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Chinese developer bought 49% stake in 2011
Billionaire developer Zhang Xin is selling her 49 percent stake in Park Avenue Plaza, valuing the 45-story building at $1.3 billion. Closer Properties, which holds the stake, has listed the property located at 55 East 52nd Street. The building spans 1.2 million square feet and is predominantly leased to major tenants like Evercore and Morgan Stanley. With no significant lease expirations before 2035, the property offers over a decade of stable net operating income, minimizing rollover risk.
This listing is the first high-profile trophy office property on the market in 2026, reflecting renewed investor confidence in New York's office sector, bolstered by a notable surge in leasing activity throughout 2025, which saw the highest leasing numbers since 2019 at nearly 42 million square feet. Fisher Brothers remains committed to the long-term ownership of the property and expresses optimism regarding its future. The exact timing of Xin's stake transfer from Soho China to Closer Properties is unclear.
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Firm fulfilled obligations at Plaza District office after earlier default
Two months ago, Vornado Realty Trust appeared to be losing 650 Madison Avenue, but Steven Roth successfully retained ownership of the property. Vornado has exited special servicing after meeting its obligations on the $800 million mortgage, which is now current for the next 12 months and includes a $1.5 million leasing reserve. The mortgage, maturing in three years, did not change, and ownership avoided a workout fee from the special servicer. This marks a turnaround for Vornado, along with Oxford Properties Group and the Ontario Municipal Employees Retirement System, who did not comment on the situation.
The property entered special servicing in October due to payment failures, prompting speculation of a quick sale. After securing a $214 million refinancing in 2019, revenue and occupancy declined significantly—falling from 97 percent to 57 percent as Ralph Lauren downsized. However, occupancy rebounded to 98 percent recently, housing tenants like Lakewood Capital, with retail space occupied by various luxury brands. The property's value has decreased from $1.21 billion to $950 million in its latest appraisal. The 28-story building encompasses 595,000 square feet and was acquired in 2013 for about $1.3 billion.
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Extell filing slams last-minute scramble to block Worldwide Plaza UCC sale
Gary Barnett has contested allegations that a foreclosure auction related to Worldwide Plaza is a manipulative effort by SL Green and RXR to gain control of the property. Barnett’s Extell Development filed documents claiming the lawsuit filed by the rival landlords is baseless and intended to obstruct a UCC sale they have known about for months. The dispute revolves around a scheduled foreclosure auction on January 15 for 825 Eighth Avenue, a 1.8 million-square-foot office complex owned by SL Green and RXR, who argue that the auction is commercially unreasonable.
They assert that the auction’s timeline and documentation were cleverly designed to ensure Barnett’s success. However, Extell counters that SL Green and RXR have been in default for over a year and were informed of the auction on October 31. Extell’s court filings assert they are not legally justified in blocking the sale, rejecting claims about lack of control over the mezzanine loan and arguing that auction terms were previously acceptable. Extell also mentions that SL Green and RXR cannot demonstrate irreparable harm, as they have indicated the property's value is below the senior debt. The senior debt had gone into special servicing due to significant vacancies at Worldwide Plaza.
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Manhattan's retail sector ended 2025 on a subdued note but showed improvement from the previous year. Average asking rent was $670 per square foot in Q4 2025, slightly lower year-over-year. Available retail spaces decreased by 11%, totaling 173, marking a significant recovery from the pandemic's impact, which left 290 vacancies in mid-2021. The Plaza District was the busiest in Q4, with approximately 97,000 square feet leased, while Chelsea dominated 2025 as a whole, with over 285,000 square feet taken. The largest Q4 deal was Chelsea Piers leasing 47,000 square feet at 135 E. 57th St., followed by Equinox's 44,000-square-foot deal at 261 11th Ave.
The food and beverage sector was particularly active, accounting for over 153,000 square feet in Q4 and 824,000 square feet for the year. Health clubs and apparel retailers followed suit, leasing around 138,000 and 73,000 square feet respectively in Q4. Fifth Avenue between 49th and 59th streets saw a notable rise in vacancies, while West 14th Street witnessed a decline. Average rents remain about 40% below the 2014 peak, with significant drops in Herald Square and Times Square, contrasting with rent increases on Madison Avenue. Overall, rents ranged from $227 to $2,569 per square foot across various areas.
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GFP Real Estate has successfully refinanced a Midtown office building, 515 Madison Ave., securing an $86.5 million loan from Apple Bank, indicating recovery in the sector. The 42-story DuMont Building is nearly 100% leased after facing significant challenges during the pandemic, including a 25% vacancy rate in summer 2022 and defaulting on a $103 million loan in January 2023. GFP, which has taken full ownership by acquiring ATCO's minority interest, previously held a $120 million mortgage on the property, reduced to $81 million.
Cynthia Wang of Apple Bank acknowledges a long-standing partnership with GFP, while specifics regarding ATCO’s buy-out price remain undisclosed. Originally built in 1932, 515 Madison was previously known for its role in early television broadcasting. Since March 2023, following strategic efforts to boost occupancy, the building has successfully signed over 32,000 square feet of leases. Current tenants include Longacre Asset Management and Encore Physical Therapy, with office rents estimated between $56 and $68 per square foot. GFP's broader portfolio includes over 80 properties across 18.5 million square feet.
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The Moinian Group has refinanced its office towers at 535-545 Fifth Ave. with a new $310 million mortgage, replacing an unpaid loan of the same size due last March. Deutsche Bank and Société Générale provided the funding. CEO Joseph Moinian emphasized that the refinancing demonstrates the value of prime Fifth Avenue properties and reflects their effective asset management strategy. The buildings include a 36-story structure at 535 Fifth, covering 330,000 square feet, and a 14-story building at 545 Fifth, totaling 180,000 square feet. As of late 2024, these properties were 90% occupied, featuring tenants like an NBA store. Moinian Group, which owns 20 million square feet, completed the refinancing in a challenging capital markets environment, showcasing asset quality and strong lender relationships.
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In NYC, where daycare averages $26K annually, a candidate's promise of universal childcare led to electoral success. Despite Gov. Hochul and Mayor Mamdani's $4.5B plan to improve childcare access, a significant issue is facility availability. Although a recent tax abatement incentive for childcare centers is meant to encourage landlords to expand, many are unaware. Demand varies across boroughs; for instance, Bath Beach has over 600 applicants for 234 seats, while other areas have excess space. By 2025, NYC needs 68,500 preschool seats for 3-year-olds—16,000 more than available.
Current childcare funding strategies include $8.6B already allocated, primarily for family vouchers and new centers, but operational challenges persist, particularly in finding suitable ground-floor locations under zoning laws. Retail rent is soaring, complicating affordability. The timeframe to secure licensure and occupancy can also delay openings, impacting financial viability for childcare operators. Partnerships between landlords and operators, offering stability despite longer pre-opening periods, may facilitate growth, though broader visibility for community facility space remains crucial for successful childcare expansion.
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Lender garnishing companies for a $132M judgment
On the eve of Christmas Eve, Meyer Chetrit’s stakes in two holding companies were auctioned off, with Maverick Real Estate Partners being the highest bidder. This entity had previously foreclosed on Chetrit, securing a judgment of $132 million and pursued recovery through garnishments and asset auctions. The recent auction highlights Chetrit's ongoing financial struggles and Maverick's aggressive strategy to acquire Chetrit’s interests at low costs. This auction marks the second phase of their legal confrontation, the first featuring competitive bids between Chetrit's brother Juda and Maverick. However, the second auction saw no participation aside from Maverick's affiliate.
During this auction, Maverick acquired Chetrit’s interest in CF Jamaica, which manages a residential building in Jamaica estimated at $150 million but burdened with $285 million in debt. Additionally, Maverick won control of the 90-100 Trinity Holder entity, likely associated with the Chetrits’ properties in Manhattan, though Meyer Chetrit's personal interest remains uncertain. The lack of auction attendees is attributed to minimal advertising, with only day-of newspaper notices required and no online promotion. Despite Chetrit's attempts to halt the auctions legally, the court ruled against him, allowing Maverick to proceed unopposed.
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Developer plans 316 units in Hell’s Kitchen
Isaac Hera is advancing the redevelopment of the former Watson Hotel, supported by a $326 million construction loan from Barings for a hotel-to-residential conversion at 440 West 57th Street. The project aims to create 316 apartments across two towers. Yellowstone Real Estate Investments, which bought the leasehold and existing mortgage for $175 million in 2021 after a prior default, has faced delays due to the Watson's use as a migrant shelter during the pandemic.
Mayor Eric Adams indicated the shelter would close by summer, facilitating redevelopment. Updated plans filed with the Department of Buildings include two residential towers and a cellar parking garage, featuring amenities such as an entertainment lounge, gaming room, pet playroom, fitness center, and an indoor pool, while retaining the existing rooftop pool. This conversion reflects Hera's focus on adaptive reuse, as seen in another ongoing project for a 422-unit office-to-residential conversion at 1730 Broadway purchased from Blackstone for $185.9 million.