Fathers are expected to guide their sons along in the family business. But real estate investor Arnold Penner is being accused by his son of duping him out of a multimillion-dollar stake in a Tribeca office building, according to an explosive new lawsuit.Jonathan Penner, who is seeking $27 million in punitive damages, is accusing his father of “hoodwinking” him, and fraudulently convincing him to sell his ownership stake in a 15-story office building for the bargain basement price of $300,000.
“In a shocking display of familial treachery, fraud and overweening greed, Jonathan’s father, Arnold, defrauded his son by inducing him into surrendering his valuable interest in certain real property,” the suit alleges.
Arnold Penner is a co-owner of the Midtown restaurant P.J. Clarke’s and a director at investment firm United Capital. He also is a minority investor in Terra Holdings, the private firm that owns brokerages Halstead Property and Brown Harris Stevens.
According to the suit, Jonathan owned a 32.5 percent stake in 250 Church Street, which Arnold bought in 1999 with developer and business partner Philip Pilevsky, the chairman of Philips International. It’s unclear what they paid for the 202,000-square-foot property, which is located at the intersection of Church and Leonard streets. But in 2006, among skyrocketing building values, Arnold and Pilevsky sought to cash out on their investment, the suit states.
Jonathan alleges that his father said at the time that his ownership stake “worthless as a result of certain liabilities” and urged him to sell his stake “right away before the liabilities became due and owing.” Jonathan said he trusted his father and Pilevsky, and he agreed to sell his stake for $300,000 – far below the market value, according to the suit. The building is near the Alexico Group’s glitzy 56 Leonard Street project.
The suit goes on to say that in April 2014, Jonathan learned that his father and Pilevsky refinanced the Church Street property just days before buying him out in 2006. In the suit, Jonathan accuses them of obtaining a $27 million mortgage and keeping a portion of the proceeds for themselves.
Arnold Penner, Pilevsky and 250 Church Group LLC are named as defendants in the suit. A lawyer representing the plaintiffs did not immediately respond to a request for comment.
This summer, Arnold sold an Upper West Side parking garage to developer Miki Naftali’s the Naftali Group for $61 million. Naftali plans to build an 18-story condo building at the site.
Pilevsky once sought to buy the Empire State Building with Joseph Tabak of Princeton Holdings. The pair bid $2.1 billion for the tower in 2013.