The new owners of One Canal Place, the 32-story Class A office tower at 365 Canal Street, filed for Chapter 11 bankruptcy protection on June 5 in New Jersey — less than three months after purchasing the building for $28 million. Brothers Michael and David Shabsels, New York-based investors who acquired the property through a company called One Canal Place Leasing LLC, placed their sprawling network of entities into bankruptcy reporting assets of between $100 million and $500 million against debts of between $500 million and $1 billion.

One Canal Place is one of roughly 80 properties across 24 states — including office buildings, shopping centers, apartment complexes, and summer camps — caught up in the bankruptcy filing. The tower, completed in 1979 and encompassing 630,581 rentable square feet of Class A office space, is part of a mixed-use complex that also includes The Shops at Canal Place, the Westin New Orleans Canal Place hotel, and a 1,650-space parking garage. Corporate Realty, which has managed and leased One Canal Place since 1991, was announced as the continuing property manager and leasing agent at the time of the March acquisition and remains in that role.

When the sale closed on March 26, it was publicly attributed to Skysoar Capital Partners, described as an Israeli investment firm with offices in New York owned by Moshe Meir. Bankruptcy court records subsequently revealed that One Canal Place Leasing LLC is 90% owned by the Shabsels brothers, not Skysoar. Court records also show that an entity linked to the brothers borrowed $11 million against the underlying land shortly after the acquisition, resulting in a pair of mortgages totaling $31 million on a property just purchased for $28 million.

The financial picture behind the acquisition was deteriorating before the bankruptcy was filed. Three months before entering the New Orleans market, the Shabsels raised approximately $200 million from the Israeli bond market at 7% interest, with the first payment due just one week before they declared bankruptcy. According to bankruptcy court records and Israeli media reports, their network of businesses had accumulated more than $230 million in merchant cash advances — high-cost short-term business debt — and attracted an investigation by Israeli regulators into diverted funds.

The bankruptcy adds new uncertainty to a building that had received a signal of confidence just days before the ownership switch closed. Law firm Baker Donelson announced in February that it would relocate its New Orleans office from Place St. Charles to the top two floors of One Canal Place in fall 2026, bringing nearly 60 attorneys and more than 100 employees to the building. The Shops at Canal Place had already lost its anchor tenant, Saks Fifth Avenue, earlier this year after Saks Global filed for its own bankruptcy. Saks has since emerged from Chapter 11 under the name Exemplar Luxury Group. Corporate Realty’s role in continuing day-to-day management of the property means building operations are expected to continue normally during the restructuring process, though the tower’s long-term ownership and any planned improvements are now subject to the outcome of the New Jersey bankruptcy proceedings.

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