I feel like any statement with "surely all they have to do" is going to miss some nuance.

In this particular case the apartment is owned by the coop (that's how coops work) and the mortgage is for the shares in the coop. So maybe more complex than a basic foreclosure where it might possibly work more like you'd think.

I think the broader point is if real estate is selling well below what is you would expect, there's a reason for that.