Developer of Brooklyn’s tallest skyscraper defaults on $240M loan — 93-story building faces foreclosure

Hannah Frishberg
·2 min read
91

Brooklyn’s tallest building is struggling to pay its skyscraping loans.

Michael Stern, the developer of 9 DeKalb Avenue’s 93-story The Brooklyn Tower, has defaulted on a $240 million mezzanine loan and now faces foreclosure, the Real Deal has reported.

A UCC foreclosure auction has been scheduled for Jun. 10 by Silverstein Capital Partners, which issued the loan in 2019, according to marketing materials from real estate company JLL.

The Brooklyn Tower, a 93-story structure located at 9 DeKalb Avenue, is the tallest building in the borough.
The Brooklyn Tower, a 93-story structure located at 9 DeKalb Avenue, is the tallest building in the borough.

“9 DeKalb’s junior mezzanine, senior mezzanine and mortgage loans are in maturity default, and the junior mezzanine lender is enforcing its junior mezzanine loan remedies through a Uniform Commercial Code (UCC) sale process,” a Silverstein spokesperson confirmed to The Post.

“The junior mezzanine lender has engaged JLL to market the equity interests securing the junior mezzanine loan, and they will conduct a public auction after a marketing period.”

Stern’s JDS Development Group did not immediately return The Post’s request for comment.

It’s unclear what will become of the tower, which only opened to tenants last year.

The news comes just days after a 440-square-foot studio in the skyscraper sold for $905,000, making it the most expensive studio in borough history, 6sqft reported.

A video producer who lives across the street previously told The Post that the building looks like “the headquarters of an evil corporation in a superhero movie.”
A video producer who lives across the street previously told The Post that the building looks like “the headquarters of an evil corporation in a superhero movie.”

The apartment, unit 72A, is more than 720 feet from the street below and features floor-to-ceiling windows, and in-unit Miele washer-dryer and European white oak flooring.

“This is an incredible milestone for Downtown Brooklyn. Our newest residents will be living at the highest elevations ever available in the borough,” said Stern, who attempted to sell part of the 1,000-foot-tall Downtown Brooklyn behemoth’s rental portion in early 2023.

At the time, he put its 398 rental apartments as well as the building’s amenities — including a pool, 50,000 square feet of retail and 77,000 square feet of workout facilities provided by the upscale chain LifeTime Fitness — on the market for an ambitious $500 million.

It’s unclear what will become of the tower, which only opened to tenants last year.
It’s unclear what will become of the tower, which only opened to tenants last year.
The sleek skyscraper is located in Downtown Brooklyn. Grain London Ltd
The sleek skyscraper is located in Downtown Brooklyn. Grain London Ltd

But a deal was never struck for the listing, which notably did not include the 93-story skyscraper’s 143 individual residential condominiums, and now the building’s fate is up in the air.

In addition to now having a reputation for financial trouble, the looming metallic supertall has also become known for its “evil vibes.”

A video producer who lives across the street previously told The Post that the building looks like “the headquarters of an evil corporation in a superhero movie.”