A day after the Appellate Division kicked the legs out from under Charles Cohen, the billionaire office landlord is back on his knees asking a lower court for salvation.
Cohen is currently on the hook for an $187 million personal guarantee after losing a long legal battle with Fortress Credit. On Thursday, he wrote to New York Supreme Court Justice Joel Cohen through an attorney, requesting that the judge hold off on entering a judgment so Cohen can settle with Fortress.
Cohen’s attorney Rolando Acosta of Pillsbury argued that more time would conserve court resources, according to a letter submitted in court records.
The thing is — Fortress doesn’t want to settle, and it already told Cohen as much.
“Fortress rejected Mr. Cohen’s offer to engage in good-faith negotiations,” Acosta wrote.
Fortress did not immediately respond to a request for comment.
It’s no big mystery why the lender turned down Cohen’s request.
The two have been in a knock-down drag-out for more than a year over a $534 million loan which Cohen claims Fortress agreed to extend. Fortress alleged that the new terms were never put in writing, meaning the extension never happened. The courts agreed and despite Cohen’s best efforts to fend off Fortress, the lender won the right to collect on the monster guarantee.
But before the fight hit the courts, emails between Cohen’s and Fortress’s respective teams show that the lender gave the landlord multiple chances to dig himself out of default. Fortress’ credit team asked for fresh collateral; Cohen offered bleeding building. They requested additional financials; the sponsor dragged his feet, court documents detail.
And when Fortress ultimately did sue — both to collect on the guarantee and to foreclose on Cohen’s equity interest in the assets — the billionaire tried to fight it every step of the way.
Sources close to the dispute have characterized Cohen’s behavior as “irrational.”
It is possible Fortress would have considered a settlement earlier in the process (and of course, it still could).
Lenders don’t like to foreclose or wage war in the courts; they just want to be paid back. But after forcing Fortress to chase him for months on end, Cohen’s chances are much less favorable.
Amid the threat that Fortress will collect on the $187 million, Cohen has allegedly been shielding assets, including a Greenwich mansion he transferred into his wife’s name.
Fortress already took back the properties tied to the $534 million loan in a $148 million credit bid last year.
As it waits on the New York court to enforce the judgment, it has commenced collection proceedings in France, where Cohen owns a vineyard and a cinema. The French courts have already seized assets from Cohen’s “chateau,” a source close to the case said.
After Cohen lost the appeal Wednesday, Steven Cherniak, chief operating officer of Cohen’s Cohen Brothers Realty, emphasized that: “No judgment has been entered and the amount of the judgment has not yet been finalized.”
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Charles Cohen’s last stand buckles, Fortress to collect on $187M personal guarantee
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