The Chetrits’ legal and financial troubles are piling up, courtesy of, among other things, their own lawyers.
Lawyers representing Joseph Chetrit in lawsuits against Maverick Real Estate Partners have claimed that he and his brother Meyer owe over $450,000 in unpaid legal bills. The law firm, Schlam Stone & Dolan, alleges that repeated demands for payment have gone unheeded, leading them to seek removal as counsel for the Chetrit Group (not to be confused with the Chetrit Organization, which is the other wing of the real estate family).
The situation adds to a string of similar disputes, including a lawsuit filed last year by another New York law firm, Stein Adler Dabah and Zelkowitz, for unpaid legal work.
Chetrit Group’s battles with Maverick began in earnest in January of 2023, when the debt firm foreclosed on a Chetrit-owned hotel project near Penn Station. The developer retaliated with a lawsuit claiming the firm stole $20 million from him by scaring off bidders for the distressed project. Maverick seized control of the hotel one year ago this month.
Chetrit told The Real Deal that the issues with Schlam Stone & Dolan were of little concern and would be taken care of shortly.
The developer has other concerns, though. On Monday, news broke that Chetrit’s $151 million loan on 65 Broadway was being sent to special servicing. The loan is current, but is in need of a workout. The Financial District office tower is the latest in a string of office distress Chetrit Group has faced.
The other wing of the family (think Jacob Chetrit, not Joseph) has issues, too. Last year, the Chetrit Organization sold 850 Third Avenue to its lender HPS Investment Partners after falling behind on its mortgage. The firm has struggled to keep a large multifamily portfolio afloat amidst rising debt costs. And just last month, the firm’s $77 million loan for a pair of mixed-use Soho properties was sent to special servicing after it failed to make a required payment in January.
To be sure, business continues as usual at both Chetrit Group and Chetrit Organization.
Chetrit Group was at the top of The Real Deal’s 2023 rankings of NYC’s top developers by total square footage under development. The firm secured a $235 million construction loan for an Upper East Side project last November.
Meanwhile, Jacob Chetrit, in partnership with Stellar Management, recently secured a three-year extension for a $370 million CMBS loan package tied to the retail properties at Columbus Square, Commercial Observer reported.
This article has been updated to better differentiate between Chetrit Organization and Chetrit Group properties.
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What we’re thinking about: The city’s “worst landlord,” Daniel Ohebshalom, turned himself in this week about a week after the city’s Civil Court issued a warrant for his arrest. Ohebshalom is facing up to 60 days at Rikers, but could get out early if he is able to fix some of his 700 violations while in jail. How many days do you think Ohebshalom is likely to serve? Send a note to david.westenhaver@therealdeal.com.
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Closing Time
Residential: The priciest sale on Friday was $4.5 million for Unit 3 at 29 Howard Street in Soho.
Commercial: The most expensive commercial closing of the day was $27.5 million for a multifamily building at 97 Grand Avenue in Clinton Hill, Brooklyn.
New to the Market
The highest price for a residential property hitting the market Friday was $40 million for a penthouse condo at 730 Fifth Avenue, Unit PH18, in Midtown. Tal Alexander from Official has the listing.
— Matthew Elo
A thing we’ve learned: In 2023, a rare bottle of whiskey, the Macallan Fine & Rare 1926, sold for a record-breaking $2.6 million at auction, making it the most expensive bottle of whiskey ever sold. Just four years earlier, another bottle from the same cask sold for $1.9 million. The price had as much to do with what was outside the bottle as what was in it. The label is one of 12 that was designed by the Italian painter Valerio Adami.
Elsewhere in New York
— There may be just 85 legal marijuana dispensaries in New York, but there are over 2,000 illegal shops, according to the New York Times. The state has drawn heavy criticism for allowing the unlicensed shops to proliferate, while taking its sweet time in approving licensed stores.
— The contractors who managed the renovation of an East New York warehouse into an Amazon facility have agreed to pay $4 million to a worker who sued them after he was injured on the job, The City reports. The worker, Abbos Abbosov, fell through the warehouse’s roof and sustained a serious head injury.
— A 98-year-old subway station in Washington Heights is set for a much-needed renovation. The station at 190th Street is one of two aging stations — the other is the Chambers Street station near City Hall — that will get a “historically sensitive” overhaul, which is expected to cost $100 million between the pair. The 190th Street stop isn’t just a metro station, though. According to Gothamist, the station, set deep beneath Fort Tryon Park, doubles as a nuclear shelter.