A Manhattan office landlord has told investors it may not survive the next 12 months, as a $140 million mortgage on its last major Financial District tower barrels toward a March maturity it cannot pay off. American Strategic Investment Co. lost $16 million in the first six months of 2026, even as its external manager continued collecting $500,000 a month in fees regardless of the company’s performance.
The real estate investment trust, formerly known as New York City REIT before it changed its name in 2023, disclosed in SEC filings that it has substantial doubt about its ability to continue as a going concern. As reported by Bisnow, the company owes $249 million in total debt and has found no buyers for 123 William St., the 27-story, 545,000-square-foot Class-B office skyscraper it bought for $253 million in 2015. It announced plans to sell the building back in April 2024, without success.
The tower, now valued at $137.7 million as of the end of the second quarter, carries an underwater mortgage of $140 million that matures in March. Occupancy at the building has slipped to 72% as of June, down from 84% a year earlier. Ratings agency KBRA downgraded three classes of the property’s commercial mortgage-backed securities loan in May and has estimated that bondholders could face a 54.6% loss.
A Portfolio in Free Fall
ASIC’s troubles at 123 William St. are only the latest in a string of losses. The company sold 9 Times Square in 2024 for a $100 million loss, after acquiring the property for $162.3 million in November 2014 and unloading it for just $63.5 million, according to The Real Deal. It also defaulted on a $99 million loan at 1140 Sixth Ave. and agreed to a consensual foreclosure on that building at the end of 2025, a move the company says cost it rental revenue that helped drive second-quarter 2026 total revenue down 40% year-over-year, from $12.2 million to $7.3 million, per a company earnings release. On the accounting side, ASIC recorded a $110.9 million contract asset in early 2026 to reflect the debt relief expected once that foreclosure is finalized…