Sandwiched Building on West 86th Street Headed to Auction House

A prewar apartment building on West 86th Street will be auctioned off Wednesday afternoon, according to a report by Crain’s New York Business.

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The five-floor, ten-unit building at 330 West 86th Street–squished between two fifteen-story buildings–has been embroiled in legal challenges since the early 1990s. The current owner, Garofalo Real Estate Holdings, purchased the building for $7 million in 2014 but ultimately defaulted on a $4.3 million loan from Signature Bank in 2022 after pushing the deadline to pay back the loan five separate times, Crain’s reports.

Signature Bank failed in 2023, the year after Garofalo Real Estate Holdings defaulted on the loan, and Flagstar Bank took on the building’s mortgages.

Judge Francis Kahn of Manhattan Supreme Court hit Garofalo Real Estate Holdings with a $5.5 million judgment this past summer, ruling in favor of Flagstar Bank. Crain’s reports that the building’s ownership, represented by Laura Garofalo, appealed the ruling and that the appeal is still live.

The structure at 330 West 86th Street–also known as The Victor Erbacher House and located between West End Avenue and Riverside Drive–was built in 1891 and was seized by city officials in the 1990s because of deteriorating conditions. Crain’s reports it was sold in 1999 for $340,000 to tenants, who were expected to improve conditions and continue to live there. In 2001, the tenant-owners sold the building to Dark Horse Development for $2.3 million.

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Dark Horse planned to demolish the structure to make way for a high rise, but those plans were blocked by a lawsuit from a neighboring co-op at 328 West 86th Street. The building would change hands again in 2010 and in 2012, it became protected by historic district designation.

According to Streeteasy listings, seven of the property’s 10 units have been rented since summer of 2022. Prices have ranged from $3,200 to $4,500 for one-bedrooms, with a studio renting for $2,300 and a two-bedroom going for $3,995.

The court-ordered foreclosure sale will take place today at 2:15 p.m. in room 130 at the courthouse at 60 Centre St. in Lower Manhattan.

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