Courts roundup: Downtown Brooklyn ground lease; $10M Brooklyn bankruptcy

Downtown Brooklyn ground tenant sues to protect lease: The plaintiff, Moses Guttman, through the entity 170 Tillary Corp., is the ground tenant under a 48-year lease commencing on October 1, 1999, with a scheduled termination on September 30, 2047. The landlord Gold Tillary Realty Co., LLC is an entity controlled by Tibor Hersko and Gabriel Hersko. The base annual rent started at $340,000. The suit seeks a judgment blocking an alleged lease termination, but does not provide a dollar value for the lease. The plaintiff, in seeking to halt a lease termination, is asking for what is known as a Yellowstone injunction. The landlord in response papers said the tenant owes $628,532 in real estate taxes and other minor fees. In addition the landlord said it received a notice that an insurance policy the tenant is required to maintain would not be renewed, among other claims. According to the attorney for the landlord, “it is black letter law that a Yellowstone injunction is unavailable to a tenant in regard to a rent demand, which is a statutory prerequisite to a summary non-payment proceeding.”

$10M bankruptcy for Brookland Capital project: The owners of a stalled 37-unit project at 154 Lenox Road in the Flatbush-Ditmas Park neighborhood, which was facing a final order of judgment and sale, filed for bankruptcy protection Friday in Brooklyn under the name 154 Lenox LLC. The filing lists assets of at least $10 million. The proposed condo development was started by Boaz Gilad’s Brookland Capital. Under enormous debt, Gilad left the company and in early 2019 Ronel Ben-Dov took over to manage the company and sell off assets. Gilad filed for personal bankruptcy in 2020. At this property, a final order of judgment and sale was entered in February 2022 with debts of $5,082,970 as of August 2020.