The owners of a run-down and long-vacant hotel dubbed the “black hole of Times Square” are allegedly hundreds of millions of dollars behind on loans linked to the property — and their lenders are seeing red.
Joseph and Meyer Chetrit were reportedly sued by Mack Real Estate Credit Strategies for failing to pay $223 million in mezzanine loans secured on the Carter Hotel, the infamous hulking property at 250 W. 43rd St., which has been cited multiple times as “America’s filthiest hotel.”
Mack wants a “quick payoff” on the loans issued in 2022 that came due in September, according to Crain’s. If the Chetrits can’t put up the money — or negotiate new terms — by a Feb. 20 Manhattan Supreme Court hearing, Mack could move to foreclose on the hotel, the outlet reported.
The case doesn’t involve the primary mortgage on the property, which opened as the Hotel Dixie in 1930 and underwent numerous ownership changes.
The Chetrits bought the 700-room, low-end inn for $192 million in 2015. Although they planned a major renovation, work stalled, leaving a jumble of scaffolds and construction fences around the building for the past several years.
The Chetrits also owe more than $420,000 in state and city fines on the building’s dilapidated state, Crain’s said.
Joseph Chetrit’s lawyer, Leo Jacobs, told Crain’s he’d try to postpone the February court appearance by up to two months. He blamed the loan situation on “market volatility.”
Jacobs didn’t respond to The Post’s request for further comment.
The eyesore stands between the Lyric Theater, home to “Harry Potter and the Cursed Child,” and the Westin Hotel. Its derelict condition has long irked area businesses and civic leaders.
Asked whether the Carter fell within the boundaries of the Times Square Alliance Business Improvement District, organization president said, “Unfortunately, yes.”
A manager at Los Tacos No. 1 across the street, who didn’t want his name used, said, “It’s bad. Junkies go behind the wood fence at night. They do business there. The building is closed so nobody stops them.”
The Carter, originally a respectable budget hotel, was never a crown jewel. It was the site of four murders over the years. Among them, aspiring model Kristine Yitref’s strangled, beaten and naked body was found under a bed in 2007.
A city development official in the 1980s referred to the hotel as “nightmare alley.” It was deemed unsuitable even for homeless families housed there at the time.
In 2014, New York magazine suggested, “If you still want a touch of the vice-ridden Times Square of the 1960s and ‘70s, consider spending a night at the Hotel Carter.”
USA Today reported it was full of “roaches, rats, black mold and stains of dubious origin.”
The Chetrit Group, which buys and sells properties at breakneck speed, owns thousands of apartments around the US. It once had ownership stakes in the Chelsea Hotel, 550 Madison Ave. and an unfinished hotel on West 34th Street.
The company is embroiled in legal battles on several other fronts as well. It faces possible foreclosure on two downtown office towers and recently narrowly staved off foreclosure on a residential development site downtown before renegotiating a loan.
