Armstrong Capital President Benjamin Ringel, currently facing foreclosure on his Hamptons mansion, is now up against a lawsuit for allegedly defaulting on a $16.3 million loan balance backed by a Food Emporium site on Manhattan’s Upper West Side. Miami Beach-based special servicer LNR on August 6 filed suit in New York State Supreme Court, alleging Ringel defaulted on the loan in January 2008.
Lehman Brothers made the original $18 million loan in 2005 for the site, a 20,800-square-foot retail space at the New West Condo, a 21-story building with 185 apartments at 250 West 90th Street. As The Real Deal previously reported, the retail site was named in a December 2010 Trepp delinquency list, which noted that a workout was being discussed.
Sources familiar with the case told The Real Deal that the foreclosure is connected to another loan that is cross-collateralized to the Food Emporium site and claimed the borrower is being “squeezed” by lenders. The lawsuit mentions a $3.4 million loan, to AC 1 Sterling, an entity controlled by Armstrong Capital. Federal court records show that the AC 1 Sterling is linked to a retail site in Sterling Heights, Michigan.
Food Emporium parent company the Great Atlantic & Pacific Tea Co. filed for bankruptcy protection in 2010, but emerged out of bankruptcy earlier this year as a private firm.
According to the New York Post, the Bank of Smithtown filed suit against Ringel last month over an alleged foreclosure on $7.8 million in loans at the Sagaponack mansion. The home could fetch $12 million at auction, according to the report. Ringel’s attorney told the Post that he was working to remain in control of the property.
Ringel declined to comment on the record and referred calls to his spokesperson. Ringel’s lawyer did not return calls. Herrick Feinstein attorney Scott Tross, representing LNR, did not return calls.