The owners of the Margaritaville Resort Times Square are in a pitched battle with their lenders over missed debt payments.
No one has to search for salt in the legal battle over the future of the Margaritaville Resort Times Square.
Days after the owners of the 36-story hotel filed for bankruptcy to avoid a foreclosure sale, two of its lenders sued members of the development team claiming they are personally responsible for the unpaid debts.
The LLC that owns the equity on the property, 560 Seventh Avenue Owner Secondary, filed for Chapter 11 bankruptcy protection Sunday night. The property was facing a UCC foreclosure auction the next day after falling behind on loan repayments, which the bankruptcy filing halted.
But in a new suit filed Tuesday in New York State Supreme Court, affiliates of lenders Arden Group and Corten Real Estate claim developers Sharif El-Gamal, who heads Soho Properties, Stephen Weiss and Andrew Weiss are now personally responsible for the full amount of the loan as a result of the bankruptcy. In its filing, Arden claims it is due more than $85M, plus legal fees.
Arden provided the hotel developers with a $57M mezzanine loan in 2021, and last year