Ocean West Capital Partners Leads Foreclosure on Manhattan Office Building

In a notable move within the real estate sector, Ocean West Capital Partners has successfully completed a UCC foreclosure on 285 Madison Avenue, a prominent office building situated in the heart of Midtown Manhattan. This property, offering a substantial 511,000 square feet of office space, is strategically located near Grand Central Terminal, making it a prime asset in one of the most sought-after submarkets in New York City.

The foreclosure comes in the wake of a loan default that occurred late in 2022. Initially, the loan had been extended in hopes of recovery, but it fell into default again in late 2024 when the extension period ended. Ocean West was engaged at this critical juncture to assist a consortium of Korean insurance companies, acting as the mezzanine lender, in evaluating various strategies for debt recovery.

Despite the challenges faced, the property remains well leased and is part of a market that has seen a significant uptick in office space demand. With Manhattan’s leasing trends improving and an increase in overall investment activity, the mezzanine lenders determined that leveraging their foreclosure rights and planning to invest additional capital into the property was the most effective path forward.

Ryan Tucker, Principal at Ocean West, expressed optimism about the building's potential, noting, “We believe that the quality of the building, the vibrancy of the market, and our cost basis will provide a strong opportunity to enhance cash flows and create value over time.” The building boasts a coveted location on Madison Avenue, just steps away from one of the city's busiest transit hubs. Recently, more than $80 million was invested in renovations to modernize the facility, which now features attractive amenities such as a rooftop deck, an event space, a conferencing center, and an onsite gym.

The acquisition of 285 Madison Avenue through UCC foreclosure is part of a larger trend where Ocean West has been involved with over $2 billion in New York City assets for Korean institutional investors in the last year alone. Phil Choi, Principal and Co-Founder of Ocean West, remarked on the proactive stance now being taken by Korean investors: “We have seen a change in tenor from the Korean lending community whereby they have become more aggressive in protecting assets located in strong markets. These investors, which include some of the largest insurance companies and pension funds globally, have the capital to execute a variety of strategies as necessary.”

Throughout the foreclosure process, DLA Piper LLP played a critical role, acting as legal representation for the mezzanine lender and aiding in the development and execution of the foreclosure strategy. Additionally, Newmark was responsible for managing the UCC auction marketing process, while Daol Asset Management served as the Korean investment advisor for this transaction.

For any inquiries related to office leasing, agents Daniel Levine and Dylan Weisman can be contacted at Newmark. Retail leasing queries should be directed to Adam Weinblatt and Jason Pruger, who are also affiliated with Newmark.

Ocean West Capital Partners operates as a full-service real estate investment and management platform. With a mission to identify and capitalize on opportunities that deliver long-term value to partners and investors, the firm has executed over $8.5 billion in commercial real estate transactions across various sectors since its inception in 2010.

As the landscape of Manhattan real estate evolves, developments like the acquisition of 285 Madison Avenue highlight the intricacies and dynamics of the market, as lenders adapt to current trends and invest in properties with promising potential.