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Bisnow\/Allie White<\/p>\n
123 William St., a 27-story skyscraper, is the most valuable asset still owned by American Strategic Investment Co.<\/p>\n
ASIC, which changed its name from New York City REIT<\/a> in 2023 as it attempted to shift into assets away from its home base, has been in a downward spiral in the years following the pandemic. Its shares have lost more than 90% of their market value since 2022 as it struggled with tenant departures and started defaulting on its debt obligations.<\/p>\n But until this year, ASIC’s external manager and majority owner, AR Global, has said its plan to sell assets and its willingness to lend money to keep the REIT afloat alleviated any doubt about its ability to stay in business. That language changed in its 2025 annual report, issued in April, admitting that \u201csubstantial doubt about the Company\u2019s ability to continue as a going concern has not been alleviated.\u201d<\/p>\n Its prospects for paying off its $249M debt pile have dimmed as interest rates have stayed high and its losses have piled up.<\/p>\n Its largest obligation is the $140M loan tied to 123 William St<\/a>., a 545K SF Class-B office skyscraper in the Financial District, which matures in March. (Editor’s note: 123 William is also Bisnow’s headquarters.) The REIT announced plans in April 2024 to sell the building, but it has found no takers. Occupancy fell from 84% a year ago to 72% as of June, according to its quarterly report filed with the SEC<\/a> last week.\u00a0<\/p>\n New York City REIT bought the 27-story tower for $253M in 2015 but valued it at $137.7M at the end of Q2, less than the outstanding balance on the mortgage.\u00a0<\/p>\n \u201cWe remain focused on completing our remaining asset dispositions and directing capital toward the opportunities we believe will create the most durable value for our shareholders,\u201d ASIC CEO Nicholas Schorsch<\/a> Jr. said in a statement accompanying the company’s second-quarter earnings results.\u00a0<\/p>\n The REIT lost $16M in the first six months of this year and generated just $14.7M in revenue. Affiliates of AR Global collected roughly $6M in advisory and management fees over that period but accepted $4M of that total in new stock instead of cash, as the REIT’s unrestricted cash dwindled from $5.3M in June 2025 to $2.4M as of June 30.<\/p>\n ASIC’s management agreement dictates monthly $500K payments to AR Global affiliates, regardless of performance. Jonathan Morris<\/a>, a former REIT executive who teaches a class on REITs at Georgetown University<\/a>, said most managers are paid based on performance.<\/p>\n \u201cThey keep it on life support because they\u2019re taking a huge salary, and they\u2019ve got a lot of equity,\u201d Morris said. \u201cWhy are they getting $4M or even $6M? They\u2019re running a company that\u2019s in the red, so why does anyone deserve a fee for doing that?\u201d\u00a0<\/p>\n The company was founded in 2013 by controversial real-estate-empire builder Nicholas S. Schorsch \u2014 it was one of the 15 firms he resigned from in 2014 amid an accounting scandal that ended with him and his companies paying tens of millions to settle class-action lawsuits and a Securities and Exchange Commission judgment<\/a>.\u00a0<\/p>\n The elder Schorsch still owns a majority stake in ASIC through his Bellevue Capital Partners venture, according to SEC filings<\/a>. At its peak, the REIT owned nine assets, and its stock was trading at more than $100 a share in April 2022 when then-CEO Michael Weil announced it would stop paying dividends<\/a> and divert its available cash into renovations and attracting tenants.\u00a0\u00a0<\/p>\n But the gambit didn’t pay off. It shed 9 Times Square in 2024 for a $100M loss<\/a>. Schorsch Jr., 41, was named CEO in 2025 and chairman of ASIC’s board in July, all while serving as chief operating officer of Rhode Island-based AR Global, a subsidiary of Bellevue Capital.\u00a0<\/p>\n At the end of 2025, ASIC agreed to a consensual foreclosure of the Class-A office building at 1140 Sixth Ave. after defaulting on its $99M loan at the property, according to SEC filings<\/a>.<\/p>\n It is attempting to do the same at one of its four remaining assets, but a group of Upper West Side<\/a> condo owners has thrown that process into disarray.<\/p>\n The REIT agreed in June to allow a foreclosure to proceed on office and lab space and a parking lot underneath the Laurel condominium on the Upper East Side<\/a> as well as the parking lot at 200 Riverside Drive, according to court records<\/a>.<\/p>\n It acquired the 120K SF portfolio in September 2014 for $88M and refinanced it in 2018 with a $50M loan from Soci\u00e9t\u00e9 G\u00e9n\u00e9rale that was bundled into a CMBS loan. The special servicer for the loan, Rialto Capital Advisors<\/a>, filed a suit in January seeking to put the units in receivership and initiate a foreclosure.\u00a0<\/p>\n But even though the REIT is ready to wash its hands of the property, the transfer is on pause.\u00a0<\/p>\n The board of managers at the 45-story 200 Riverside condo building, known as Trump Place until 2018<\/a>, sued the CMBS trustee in February, claiming it was entitled to the rents being paid by the parking garage operator because ASIC had fallen behind on common charges to the board.<\/p>\n Rialto has been collecting the rents from the parking garage, operated by City Parking, after ASIC defaulted last year. Attorneys for City Parking filed an interpleader complaint asking New York County Supreme Court Judge Dakota Ramseur to rule on who it should be paying.<\/p>\n \u201c200 Riverside Garage is willing to pay the rent to whichever party is determined to be legally entitled thereto,\u201d its attorneys wrote in a June filing<\/a>.<\/p>\n Ramseur has yet to issue an opinion or rule on a motion in the case.\u00a0<\/p>\n The foreclosure action has stalled as a result, leaving the 33K SF of vacant office and retail space at the base of the Laurel, a 31-story luxury tower at 400 E. 67th St., still in the hands of ASIC. In a May ratings report, KBRA downgraded three classes of the CMBS loan and estimated that bondholders could be left with a 54.6% loss.<\/p>\n ASIC’s other two properties, an 18K SF Brooklyn preschool and the 60K SF of retail and office space at the base of 196 Orchard St. on the Lower East Side<\/a>, are fully leased. But even the preschool building isn’t generating any cash flow and is in breach of a debt covenant as a result.<\/p>\n The company’s executives gave no indication that they would hold a call with investors following the latest earnings results. ASIC didn’t respond to requests seeking comment with Schorsch Jr. or other executives. At its last earnings call in May, Schorsch Jr. was still signaling a future after getting rid of its remaining assets.<\/p>\n