Kinsmen terminates $50M Nolita ground lease with REEC, sues alleging multiple defaults

Kinsmen Property Group filed a complaint yesterday against its former ground tenant Real Estate Equities Corporation and principals Mark Seigel and the late Brandon Miller, alleging they failed to demolish the existing buildings and construct a new mixed-use office building as the lease required. Kinsmen is seeking to recover the unpaid rent, demolition costs, liens and taxes totaling $5.4 million as well as an unstated amount for defaulting on the requirement to build the new building. Kinsmen, by the signature of Ari Zagdanski, filed the complaint in New York State Supreme Court in Manhattan March 18, 2025.
Court filings represent the position of one party and are not necessarily accurate or complete.
Case LINK

The landlord already filed a document in city records dated January 23, 2025, terminating the ground lease, which Seigel signed. The REEC ground lease, valued at $50 million, was signed in August 27, 2020, and is subject to a $60.5 million loan from Raven Capital Management signed August 31, 2025. The ground lease required REEC to demolish the existing buildings and construct, “a new six or seven-story mixed use office building,” with 60,000 or 70,000 square feet. REEC never demolished the buildings, so starting in October 2024, Kinsmen did, costing it $1,746,261, the complaint says.

Real Estate Equities Corporation submitted a new building construction project for a 72,441 square-foot business (B) building at 156 Bowery in Nolita, Manhattan. The plan was filed with the New York City Department of Buildings on April 21, 2022 under job number M00703761. It calls for the construction of a seven-story building. The project is described in the filing as: 7 story commercial new building filing.

Brandon Miller killed himself by inhaling exhaust fumes, according to news reports, and died July 3, 2024. His wife is now executor of his estate, according to the complaint. According to the complaint, “Tenant is presently in arrears with respect to its obligation to pay Base Rent under the Lease in the amount of $2,928,222.09 (“Arrears”), representing (i) monthly installments of Base Rent for the months of March 2024, July 2024, August 2024, September 2024, October 2024, November 2024, December 2024, January 2025, February 2025 and March 2025…” as well as other expenses.

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