July 8, 2025 #1 Local News, Information and Event Source for the Century City/Westwood areas.

WS Communities Faces Major Setback, Loses Half of Portfolio to Lenders

Property Firm, Founded by Neil Shekhter, Grapples with $1.1 Billion Debt 

By Keemia Zhang

WS Communities, a property firm founded in 2017 by local landlord-magnate Neil Shekhter, lost half its portfolio to lender companies in lieu of foreclosure. The company sought relief for $1.1 billion in debt, as reported by The Real Deal. As of this writing, WS Communities’ website has gone down. 

The company, which owns luxury and affordable residential units, retail, and office spaces across the Westside, lost assets of 28 multifamily buildings and sites of future development. The lenders that acquired the properties include the New York-based groups Lightstone Capital and Madison Realty Capital, as well as the local lending company Hankey Capital.

The loss was described as a “massive blow” to Shekhter and his company, which was co-founded by three of his sons and CEO Scott Walter. In 2020, the firm owned 2,200 units across the county. Following the lender acquisitions of 870 units, WS Communities also sold 200 units, cutting the assets in half at 1,100 units.

Deeds-in-lieu were described as both a last resort for property owners and a “faster alternative” to foreclosure processes. According to a source quoted by The Real Deal, Shekhter’s assets were at floating-rate loans rather than cash-flowing, following an increase in his monthly debt bills after the Federal government increased rates in 2022. 

Lenders, which have recently veered away from refinancing loans due to LA’s increased transfer taxes, are hesitant to quickly sell off the properties, given that interest rates have slowed the buying market. 

The scale of portfolio decrease is comparable to Veritas Investments’ loss last year, which forced it to “lose control” of 20 apartment buildings in San Francisco following a default on almost $1 billion in loans. The company has avoided the same fate as WS Communities for its Los Angeles properties by extending the loans.

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