Maverick files opposition to Lightstone-backed plan to reorganize Brooklyn portfolio in bankruptcy

By Adam Pincus

The private equity fund manager Maverick Real Estate Partners filed a motion last week opposing a plan of reorganization backed by the Lightstone Group for a 108-unit Brooklyn portfolio amassed by operator Chaskiel Strulovitch that filed for bankruptcy last May with secured debt of $37 million.

Maverick has held the debt for nearly three years and during most of that time has accused Strulovitch through court filings of a series of technical defaults on the loans as well as other allegations of malfeasance. Maverick claims the reorganization plan is not financially viable, among other criticisms of the proposal.

Strulovitch and his backers, including the Lightstone Group’s division, Lightstone Capital, for their part, are seeking to end the bankruptcy process with a reorganization plan supported by a loan from Lightstone.

The portfolio is composed of 31 residential buildings with two to eight units in Williamsburg, Crown Heights, Bedford-Stuyvesant and other neighborhoods. Strulovitch acquired most of them between 2003 and 2013. Strulovitch paid $13.1 million for 22 of the properties, according to a PincusCo analysis of city property records. The prices for the other properties could not be determined.

Strulovitch filed a reorganization plan in January that his attorneys claim will pay enough money to Maverick and will set the 31 properties on a solid financial footing.

The battle comes as the city is battered by the coronavirus epidemic and tenant activists call for a freeze on all rent payments.

Some of the documents for the case 19-23013-rdd 53 Stanhope LLC can be found for free here or on Pacer. Strulovitch’s last name is alternately spelled in legal filings and court cases as Strulowitz.

The parties had been expecting to hold a hearing on May 6 but that has been postponed until August.

The legal wrangling stretches back to 2017. In April 2017, a group of mostly foreign individuals filed a federal lawsuit claiming their equity stakes worth millions in a portion of this portfolio had been misused as part of a fraudulent real estate investment scheme.

(That federal lawsuit was thrown out, but the plaintiffs have filed a motion to join the Maverick case and in January 2020 filed a complaint in Brooklyn state court alleging that their investment dollars were not used as the investors has anticipated.)

Three weeks later, on May 17, 2017, Maverick bought the package of loans covering 31 buildings Strulovitch controls from Signature Bank that totaled just over $37 million in outstanding principal.

Several days later, Maverick sent notices of loan defaults based in part on the understanding that Strulovitch was not the sole owner of properties as had been claimed in loan documents.

Maverick in October 2017 filed to foreclose on the properties.

In May 2019, Strulovitch filed for bankruptcy protection.

On June 19, 2019, Lightstone signed a letter of intent to lend Strulovitch $40 million to repay the Maverick loan.