Citi looks to sell $193M in defaulted loans on Ron Perelman’s buildings

Last year, billionaire Ron Perelman — troubled by since-resolved debt from Revlon and a tumbling net worth — sought to “clean house and simplify.”

That kicked off a sale of his assets, including artwork, one of his three Gulfstream jets and several high-priced homes, with some proceeds intended to pay down debt he had personally guaranteed.

Now, one of Perelman’s lenders is moving to sell defaulted loans with a balance of $193 million, The Real Deal has learned.

A Cushman & Wakefield capital markets team is marketing the Citibank notes secured by three of Perelman’s adjacent properties on East 62nd Street, including his duplex residence. The brokerage and Citibank both declined to comment on the sale.

A spokesperson for Perelman’s investment firm, MacAndrews & Forbes, said the issue is related to “appraisals that were done in June 2020 during the pandemic,” adding that, “we are in a commercial dispute over certain terms of our bank agreements and the use of flawed appraisals.”

The three-mixed use buildings at 27-33, 35 and 41 East 62nd Street total 106,000 square feet and are subject to a master lease. The properties include Perelman’s sprawling duplex penthouse; a restaurant, Fleming, which he opened in 2018; and MacAndrews & Forbes’ offices.

The loans, which mature on Aug. 31, 2023, are backed by “sponsorships’ guarantees,” which the marketing materials for the “East 62nd Street Townhouse Collection” say can only be accessed after signing a confidentiality agreement. The notes can be purchased individually or collectively.

Perelman’s art and antiques do not serve as collateral for the loan, according to earlier mortgage documents.

Perelman acquired the three properties over several decades. The 10-story building at 27-33 East 62nd Street was previously an apartment building that Perelman eventually converted to mixed-use. He paid $120 million for the property in 2014, and took out a $110 million loan in 2018 that included $41 million in new financing. The building is responsible for approximately $103 million of the outstanding debt.

No. 35 is a six-story property that’s home to the offices of MacAndrews & Forbes. Perelman bought this building in 1989, and it accounts for approximately $52 million in outstanding debt. The final property, No. 41, is responsible for just under $38 million in debt.

Perelman’s businesses have been negatively affected by the pandemic, leading to the shedding of his personal and professional assets.

“I have been very public about my intention to reduce leverage, streamline operations, sell some assets and convert those assets to cash in order to seek new investment opportunities and that is exactly what we are doing,” he said in a statement last year.

Those assets include two properties on East 63rd Street, which are being marketed by Serena Boardman of Sotheby’s International Realty. Perelman was reportedly seeking $65 million for the larger of the two buildings, and $10 million for the other. Boardman did not immediately respond to a request for comment.

Last fall, he was also reportedly seeking a buyer for “The Creeks,” a 57-acre estate in East Hampton, via a whisper listing for $180 million. Perelman’s spokesperson denies the property was ever for sale.