Chetrit Group’s Hotel Bossert Heads Back to Lender

Investment firm Beach Point Capital won a foreclosure auction for the Chetrit Group’s Hotel Bossert, after more than a decade of problems and delays for the developer at the historic Brooklyn Heights property.

The lender used its existing $177 million debt to submit a credit bid of $120 million for the Brooklyn Heights hotel at 98 Montague Street. Beach Point was the only bidder at the auction inside a crowded and chaotic courtroom just a few blocks from the hotel.

It is unclear what the new owner plans to do with the property, which is buried under scaffolding and in a state of disrepair. A lawyer for Beach Point declined to comment after the auction.

The Chetrit family had hoped to work out a deal with the lender and revive plans to restore and reopen the hotel after the sale of the note against the property to Beach Point last year. The family declined to comment.

Joseph Chetrit and David Bistricer purchased the 14-story building from the Jehovah’s Witnesses in 2013. They promised to restore the hotel to its former glory, including adding 78 guest rooms, a restaurant and a rooftop bar. A year later, renovations were underway.

But their plans got delayed. Chetrit bought out Bistricer’s interest in 2019 and secured a $112 million loan from Cantor Commercial Real Estate Lending. The loan was assigned to Wells Fargo a year later at the start of the pandemic, and went into special servicing in August 2020.

Chetrit defaulted on the loan in 2021, according to court filings; it matured that December and had not been repaid. Wells Fargo initiated a foreclosure in April 2022, claiming Chetrit owed over $126 million.

In 2023, hoteliers Ian Schrager and Ed Scheetz stepped in to possibly partner with Chetrit to rescue the hotel from foreclosure. The group sought to extend the loan with the special servicer, according to Morningstar. The group planned to refinance the loan when the establishment was repositioned as a Public Hotel.

But that never happened. The hotel’s ownership entity was scheduled for a foreclosure auction last January but the auction was postponed. Hodges Ward Elliott started marketing the $112 million note; Beach Point bought it in April for $90 million.

Lumber magnate Louis Bossert built the hotel in 1909 and it later became known as Brooklyn’s Waldorf-Astoria. The Jehovah’s Witnesses bought the building in 1983.