Contract vendee files bankruptcy over $20M deal with Acadia Realty in SI

A buyer who signed a contract with Acadia Realty Trust to pay $20 million for the retail big box location at 145 East Service Road in Staten Island put the purchasing entity into bankruptcy with the goal of gaining two months in which the buyer believes the sale will be able to close.

The buyer, Shlomo Kolodny through the entity East Service Road LLC, filed the chapter 11 petition in U.S. Bankruptcy Court in Brooklyn on August 2, 2023. 1-23-42765-nhl The petition says the buyer has put down a $3.3 million deposit that has been released to the seller, but the buyer has not been able to close.

Several buyers over the past two years have resorted to bankruptcy to hold on to a contract, including in December 2021 the $153 million purchase of the SUNY Downstate Medical Center location in Bay Ridge and in February 2023 a $92.5 million contract with seller Fairstead to buy an historic 538-unit complex of walkup apartments that covers an entire city block in Harlem.

The property has one building with 51,609 square feet sitting on a lot with a total of 242,106 square feet, according to city records. Acadia puts the retail space at 55,000 square feet, according to a leasing property listing on its website. The building was occupied by LA Fitness until last fall, according to a review of social media accounts. There is another large retail building adjacent in the strip center but Acadia Realty Trust does not own it.

According to the filing, “The Debtor is a limited liability company that is the purchaser pursuant to an Agreement of Purchase and Sale and certain amendments thereto (“Contract”) between it and Acadia West Shore Expressway LLC [Acadia Realty Trust] as seller (“Seller”) for the real property and improvements thereon located at 145 E. Service Road, Staten Island, New York (“Property”). The purchase price for the Property is $20,000,000… In furtherance of the closing on the Contract, Debtor has already deposited the total sum of $3,315,000 which has been released to the Seller.

“The Debtor filed for chapter 11 protection to obtain additional time to close under the Contract and believes that over the 60-day period provided under Section 108 of the Bankruptcy Code it will be able to close on the Contract and pay all of its creditors.”

Direct link to the property’s ACRIS page and link to DOB NOW portal.