The Real Deal New York

$50M sale of Nolita parking garage spurs lawsuits

Nest Seekers, Century 21 and P. Zaccaro all claim they are owed a commission

June 19, 2015 05:10PM
By Tess Hofmann

75 Kenmare Street in Nolita (inset: Tal Reznick, top, Josh Schuster, bottom)

75 Kenmare Street in Nolita (inset: Tal Reznick, top, Josh Schuster, bottom)

UPDATED, June 19, 5:26 p.m.: Josh Schuster and Dan Hollander’s DHA Capital and partners entered contract to buy a $50 million-plus Nolita development site earlier this month, sparking the ire of multiple brokerages that are now suing to recover the commission they are allegedly owed.

The site, at 75 Kenmare Street, currently houses a parking garage. DHA is planning to erect a 68,000-square-foot mixed-use development, as The Real Deal reported.

First, on June 9, Nest Seekers International sued DHA and the site’s seller, John Wei’s Sentry Operating Corp., claiming that agent Tal Reznick acted as the exclusive broker and is owed at least a $3 million commission.

Attached to the complaint, filed in New York State Supreme Court, is a letter of intent signed last year by Schuster and JMH Development principal Jason Halpern, a potential partner in the deal at the time. The letter lays out an offer of $55 million to buy the site from Sentry, or alternatively, a $50 million offer with a leaseback option. It specifies Nest Seekers’ exclusivity as the broker on any future deal between the parties.

Halpern told The Real Deal that he was only interested in the property briefly and moved on after completing his due diligence. The partnership that actually bought the site this year involved DHA Capital, AMS Acquisitions and First Atlantic Capital.

This week, two other brokerages entered the fray, with Century 21 and P. Zaccaro suing DHA Capital and partners, the seller Sentry and Nest Seekers, claiming that they are owed at least $4.8 million in commission.

These brokerages claim that while Nest Seekers’ Reznick was the one to procure DHA as a buyer for the site, he needed their help to make a meaningful connection with Sentry’s Wei, who was constantly inundated with half-baked purchase offers and would not have taken Reznick seriously.

Reznick reached out to Century 21 broker David Shargani, who connected him to P. Zaccaro principal John Anthony Zaccaro, who had a longstanding relationship with Wei, the suit states.

“Nest Seekers did not have the necessary connections with the seller for the seller to believe that [it] had a serious candidate that could follow through and ultimately close on a successful sale,” according to the complaint.

Century 21 and P. Zaccaro claim that as a result of the connection they provided, Reznick agreed to split a potential commission three ways. But so far, they say they have seen no money from the sale.

Their complaint alleges that Nest Seekers alone is being recognized as the broker, though Nest Seekers’ earlier complaint seems to negate that.

“But for our involvement, there would not have been a deal,” said Bryan Kishner, an attorney representing Zaccaro and Century 21. “Zaccaro is one of the most reputable, outstanding brokers that you’ll find in the commercial field. For him to be bringing this suit means a lot.”

Other parties to the suits and attorneys for Nest Seekers either declined to comment or did not immediately respond. Wei was not able to be reached.