Tallest Tower In Brooklyn Staring Down Foreclosure From Silverstein
The first loan ever originated by Silverstein Properties' debt platform could wind up with the World Trade Center developer taking control of the tallest tower in Brooklyn.
Silverstein Capital Partners has scheduled a foreclosure auction for 9 DeKalb Ave., JDS Development's Brooklyn Tower, according to marketing materials from JLL.
JDS took out a $240M mezzanine loan from Larry Silverstein’s firm in 2019 as part of a $664M debt package to build the 93-story, 1,066-foot tower in Downtown Brooklyn. JDS has defaulted on the loan, according to the foreclosure notice, first reported by ten31 on the social media platform X, triggering the foreclosure auction, scheduled for June 10.
Silverstein also bought the property’s senior debt, a $424M mortgage originally provided by Otéra Capital, earlier this year. A spokesperson for Silverstein told Bisnow in an email that the junior, senior and mezzanine loans for 9 DeKalb are all in default and that Silverstein is enforcing its rights as a lender.
The mezz loan was the first debt handed out by Silverstein Capital Partners, which was launched in 2018. It has raised over $4B since then and provided debt to projects like Hudson Cos.' One Clinton condo and retail development in Brooklyn Heights.
JDS Development didn't respond to Bisnow’s request for comment.
JDS, led by Michael Stern, tried to sell the 398-unit rental portion of 9 DeKalb, which also features 143 condos, a little over a year ago, The Real Deal reported. At the time, JDS was reportedly seeking between $600M and $700M for the rental units.
Construction on the tower, which sits atop the historic Dime Savings Bank and Junior's restaurant, began in 2015. The property, which is Brooklyn’s first supertall at just over 1,000 feet, also contains a 130K SF retail portion largely occupied by Life Time Fitness. Unit 72A this week set the record for Brooklyn’s priciest studio apartment when it sold for $905K, 6sqft reported.
