Yoel Goldman sues to halt today’s UCC auction for 123 Melrose mezz

By Adam Pincus

Yoel Goldman filed a lawsuit yesterday seeking to block the uniform commercial code (UCC) auction of a $65 million mezzanine loan position owned by Mack Real Estate secured by an interest in the All Year Management development at 123 Melrose Street, a 468-unit development called the Denizen X in Bushwick, Brooklyn. In December, Mack scheduled an auction for the mezzanine note for February 5, 2021, at 12 p.m.

The suit claims Mack and Goldman agreed on December 2, 2020, to reinstate the mezzanine loan which had been declared in default in November 2020, with a payment of $7.5 million on December 3. But, the suit claims, Mack would not accept a $7.5 million payment. Goldman includes an email chain in the court filings seeking to boost his argument, though the chain does not appear to support the claim and in fact shows Mack noted that late on December 3 it had not received a payment, and Goldman responding, “We didn’t close yet targeting for Tom[morrow.”  There is at least one more email but it’s entirely redacted.

“In effect, [Mack] is scheming to prevent Plaintiffs from paying off the mortgage as part of a scheme to unlawfully obtain the Property,” Goldman alleges in the filing.

Mack asserts that Goldman owes Mack $74.7 million for the loan plus interest and fees.

The property is under financial stress, according to an article from the Commercial Observer from December, which reported that the $170 million loan JPMorgan Chase Bank provided to Goldman’s entity Evergreen Gardens I LLC was in technical default.