R
FR's year has ended with another crisis as lender Wilmington Trust and special servicer Rialto Capital Advisors filed a lawsuit against the company over 17 State Street in Manhattan's Financial District. The lawsuit stems from RFR allegedly defaulting on an $180 million loan this summer, leaving it owing $183.5 million by November, including interest and fees.

    The plaintiffs are seeking to foreclose on the 42-story property if RFR fails to pay up. However, a spokesperson for RFR claims they're working with the special servicer through "procedural steps" and intend to retain ownership of the building. This stance mirrors their previous response when the debt was transferred to special servicing.

    17 State Street is financially sound, with an occupancy rate in the mid-90s as of August and a cash flow 3.5 times greater than debt service at the end of last year. Nevertheless, RFR has allegedly failed to deposit sufficient rent money into a required account and hasn't cooperated with requests for audits.

    This lawsuit adds to RFR's woes, which include defaulting on a $219 million senior loan at 285 Madison Avenue and a dispute over lease termination at the Chrysler Building with Cooper Union.