Mortgage servicer pays $2.29 million for foreclosed Platinum Mile property

A special loan servicer recently paid $2.29 million at a foreclosure auction to buy back from a court-appointed referee a largely vacant Platinum Mile office building whose previous owner defaulted on a $28.8 million mortgage nearly three years ago.

A state Supreme Court judge in White Plains last year issued a judgment for approximately $33.64 million, together with interest costs, against the owners of 3 Westchester Park Drive in Harrison, Dryland Gannett 3 LLC and investor George Economou. Dryland Gannett is an entity of Heritage Realty Services LLC in Manhattan, which owns and operates two other office buildings in Westchester Park Center, the former Gannett Office Park.

The four-story Class B office building at 3 Westchester Park Drive sold for $35.3 million in 2006, when the new owner secured a $28.8 million mortgage with Royal Bank of Scotland”™s financial products company. The loan was packaged to investors in a commercial mortgage-backed securities offering and was turned over in early 2014 to LNR Partners, a special loan servicer in Miami Beach. The special servicer began foreclosure proceedings that year, claiming the office owner at the time owed approximately $27.1 million in principal on the defaulted loan.

The mortgage default followed Heritage Realty”™s loss of its largest tenant at 3 Westchester Park Drive three years ago, when Wilson Elser Moskowitz Edelman & Dicker LLP, Westchester County”™s largest law practice, relocated from its 142,000-square-foot space there. Westfair Communications Inc., the Business Journal”™s parent company, is the building”™s sole remaining occupant.