A buyout firm that has quickly amassed a portfolio of Manhattan hotels, many of which operated as shelters amid the collapse of the hospitality industry during the pandemic, appears to have another property in its sights.
Yellowstone Real Estate Investments has moved to foreclose on The Hotel at Times Square, a 12-story, 234-room inn at 59 W. 46th St. in Midtown owned by Premier Hotels, based on a new lawsuit.
Long Island-based Premier, whose principals are Paramdeep Singh, Manmeet Singh and Virendra Jhaveri, are allegedly in default on a $44.5 million Yellowstone loan after failing to pay it off in full upon its February 2024 maturity date, according to the suit, filed Friday in Manhattan state Supreme Court.
The hoteliers are now on the hook for $49.5 million, when factoring in interest, late charges and other fees, according to the suit, which adds that Yellowstone seeks to take over the prewar site near Sixth Avenue to settle the apparently outstanding debts.
Premier, which bought the property for $59.5 million in 2022, according to the city register, has not yet filed a response in the case, and neither it nor the Singhs could be reached by press time. Also, a phone message left for Jhaveri, a dentist, at one of her offices in Queens, was not immediately returned.
The court battle is the latest hiccup for the property, a former Super 8 outpost remodeled into its current incarnation more than a decade ago. Longtime landlord Apple Core Holdings, the owner that switched gears at the site and transitioned it into a shelter for a couple of years, also apparently defaulted on a mortgage and later unloaded No. 59 to Premier.
But Premier doesn’t seem to have been able to turn things around, allegedly falling behind on a $4 million note about a year after acquiring the property, landing the hotel in foreclosure proceedings with a different lender.
Yellowstone seems to have helped Premier avoid losing the site by swooping in with the $44.5 million loan, a refinancing that included a $13.4 million gap mortgage, filings show. But the relief may have been short-lived.
In its suit, Yellowstone also accuses Premier of failing to make required regular deposits into a special reserve fund for the property.
Yellowstone, an upstart firm headed by CEO Isaac Hera, has moved aggressively against the owners of distressed Manhattan lodgings, including hotel-turned-shelter the Watson at 440 W. 57th St. and also 220 W. 42nd St., where Yellowstone is planning a 265-unit hotel.
As of December, Yellowstone owns Midtown’s former Maxwell at 541 Lexington Ave., where Yellowstone’s playbook resembles that of 59 W. 46th. Indeed, Hera’s company acquired a $170 million note for the 15-story, 697-room property, which closed in March 2020, before waging a years-long foreclosure battle against former owners Capstone Equities and Highgate Hotels for control of the site.
A highlight of Yellowstone’s portfolio is Eighth Avenue’s New Yorker Hotel, which the firm controls after snapping up a $106 million mortgage.
The hotel industry has enjoyed a major comeback in recent months, and city officials predict tourist traffic this year will exceed 2019 levels, though President Donald Trump’s tariff and other foreign policies could sap that momentum.
Matthew Parrott, the lawyer with Fried, Frank, Harris, Shriver & Jacobson who filed the complaint, did not reply to an email seeking comment by press time.
