Courts roundup: Maverick pre-foreclosure on $30M 432 Park unit; CORE sues Macklowe at 1 Wall; Silverback suit

Courts roundup for July 15 to July 20, 2021:

Please note that court filings are the positions on one party and are not necessarily accurate or complete.

Maverick files pre-foreclosure on $30M 432 Park unit: Maverick Real Estate Partners filed a pre-foreclosure suit on a $13.7 million loan secured by unit 72A in 432 Park Avenue. The guarantor, identified as Weihong Duan, signed for the loan for the purchase of the unit, acquired in July 2016 for $30.1 million from Macklowe Properties and CIM Group in a sponsor purchase. According to the complaint, the “Borrower’s (defined below) default under the mortgage loan follows reports of Guarantor (defined below) having been detained by the Chinese government for matters relating to a criminal corruption investigation which has been ongoing since September 2018, where she is believed to remain as of the date hereof.” Maverick purchased the loan on May 18, 2021 from the 2016 lender, China CITIC Bank. LINK

CORE sues Macklowe after brokerage termination at 1 Wall: CORE Group Marketing is seeking $750,000 from Macklowe Properties following its removal as co-exclusive broker at the condo project, One Wall Street in Lower Manhattan. According to the complaint, “CORE performed all of its obligations under the Co-Exclusive Agreement, including providing the CORE Development and Marketing Services, and worked tirelessly on the Project for five years, from before the formal execution of the agreement in May 2016, until it was purportedly terminated without cause by Owner as the co-exclusive broker effective on or about March 24, 2021, and prevented from further performance.” The opening of the Sales Center was critical to enable CORE to sell Units at the Project to the United States market. 19. Section 2(iv) of the Co-Exclusive Agreement states that operations at the Sales Center will begin on or about May 1, 2017, that is, one year after the date of the Co-Exclusive Agreement. Specifically, it provides: “[c]ommencing on or about May 1, 2017, activity at the Project’s Sales Center will commence with a dedicated [CORE] Sales Staff who will work fulltime (7 days a week) at the Project’s Sales Center and conduct on-site sales as well as provide ongoing marketing and sales strategies for maximizing sale velocity, purchaser traffic, and pricing…. Upon information and belief, the Sales Center has still not opened.” 2.675% multiplied by the “Net Sales Price” (as defined in said Section 5) of each Unit sold without the cooperation of a Cooperating Broker (as defined in Section 4 of the Co-Exclusive Agreement); or (b) 1.625% of the Net Sales Price of each Unit sold with the cooperation of a Cooperating Broker….Only after CORE demanded the Termination Fee did Owner provide written notice of its termination as co-exclusive broker effective on or about March 24, 2021. Principals of OWS told Osher that new investors in the Project, Dilmon, insisted that CORE be terminated despite the lack of cause for such termination.” LINK

Silverback founder accused of mismanaging Gramercy project: Developer Claudio Soifer alleges developer Josh Schuster of Silverback Development has mismanaged a development project at 359 Second Avenue and so Soifer says he removed Schuster as managing member, then conducted a forensic investigation of the finances and concluded $3.5 million was improperly transferred to other entities. Schuster also has two money judgments issued against him or affiliates totaling $4 million. Soifer is an Argentinian-born developer with project in Brooklyn and elsewhere. He bought the parcels 351, 353 and 359 Second Avenue between 2013 and 2015 and partnered with Silverback in 2018 with a joint operating agreement with Soifer owning 50.5% and Schuster 49.5% in SD Venture. “During JS Member’s tenure as Managing Member, JS Member continuously breached its fiduciary duty to SD Venture and CS Member. ” On April 2, 2021, Daniel Silber declared that he was the lender of a $685,700 note lent to Silverback entities and that that note was in default. Silverback Development projects. Plaintiffs have entered default judgments against Schuster for $2.1 million  and $1.9 million for a total of $4 million. The Real Deal reported on the controversy here. Court LINK

Lender files pre-foreclosure on $4.2M Bronx dev site loan: Plaza Rtl Trust filed a pre-foreclosure suit against Barker Project LLC, the owner of eight adjacent parcels including 2506 Barker Avenue which are 1-3 family homes, some with stores, in the Bronx. The guarantor of the loan is Abraham Wieder. LINK