Sapir Corp has filed for Chapter 11 bankruptcy protection for its Nomo Soho hotel in Manhattan, marking a significant step in the company’s ongoing liquidation process. The real estate firm, led by Alex Sapir, submitted the petition to bankruptcy court on Tuesday with plans to hold a court-supervised auction for the 26-story property at 9 Crosby Street.
The bankruptcy filing aims to facilitate a sale of the hotel and address Sapir Corp’s outstanding $155 million bond debt across two Israeli bond series. This action follows Sapir Corp’s entry into insolvency proceedings in Israel three weeks earlier, during which the company informed the Tel Aviv-Jaffa District Court that it could no longer meet its financial obligations or operating expenses. Following this announcement, all directors resigned and a trustee assumed oversight as the company moves toward winding down operations.
A spokesperson for Sapir commented on the decision: “Facing the ongoing challenges in the market and slow recovery from two years of Covid, during which the operation was supported with significant equity, we chose to support a process that is the most likely to result in the full payment of the debt to the bond holders.”
Sapir Corp has secured an initial buyer for Nomo Soho. Dan Hotels, one of Israel’s largest hospitality companies, has agreed to purchase the 264-room hotel for $125 million. Bondholders have approved this stalking-horse bid, and an auction will be held with an opening overbid set at $129.25 million. If no higher offer is received, Dan Hotels’ proposal will proceed.
The sale would end years of financial strain related to Nomo Soho. In 2015, Sapir and partner Gerard Guez acquired the property for $208 million after Deutsche Bank foreclosed on it. Subsequently, Sapir bought out most of Guez’s stake and refinanced several times—most recently taking out an $89 million loan through Israel’s bond market in 2022 that replaced previous financing from Goldman Sachs.
By 2024, mounting debts led Sapir Corp to seek maturity extensions and more expensive refinancing options as payments came due. The situation worsened when a missed $3 million payment in July triggered default.
Nomo Soho suffered significantly during the pandemic; occupancy dropped sharply to just under 2 percent in April 2020. Last year, Sapir attempted to sell or restructure operations by reducing management fees and exploring alternatives amid continued losses—the hotel currently employs 133 staff members but is expected to post a loss of approximately $1.3 million this year.
Nomo Soho is now one of only two remaining assets held by Sapir Corp; its other asset is an undeveloped site near Miami’s Wynwood district listed for sale at $41 million according to filings with the Tel Aviv Stock Exchange.
