The Real Deal New York

Barnett’s Extell closes in on Bracha’s 57th Street building

October 13, 2011 03:04PM
By Adam Pincus

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From left: Ilan Bracha, chairman of Keller Williams NYC, and partner Haim Binstock, 18 West 57th Street and a rendering of the condominium tower 

One of the most active building firms in the city, Gary Barnett’s Extell Development, is one step closer to taking control of a half-vacant, five-story commercial building co-owned by residential real estate agent Ilan Bracha, chairman of Keller Williams NYC. The squat 50-foot wide building, 16-18 West 57th Street, between Fifth and Sixth avenues, is one block east of Extell’s 1,000-foot tall hotel and condominium tower under construction at 157 West 57th Street, called One57. City and state public records reveal that a foreign lending company affiliated with Barnett now controls the $66 million loan lent in 2007 to Bracha and partner Haim Binstock.

Bracha and Binstock, and their B&B Investment Group, sought to develop a 28-story mixed-use tower with options for hotel and retail after buying the site in 2007 for $60 million, city records show.

B&B’s original lender on the property, Petra Capital Management, transferred its interest to a company affiliated with Barnett, called Bremsten Finance, which has an address at London-based Meridian Securities, on Oct. 4, property records filed yesterday show.

Investment sales broker, Alan Miller, a senior director at Eastern Consolidated, who was not familiar with Barnett’s move, said it appeared to be a classic attempt by a developer to get a foot in the door.

“It sounds like it is a high-stakes game of Monopoly being played,” he said, noting that Sheldon Solow and others own adjacent or neighboring properties, and may be trying to put a bigger project together. “Assemblages are always secretive.”

This is not the first of Bracha and Binstock’s properties to run into troubles. In May, their lender filed to foreclose on a commercial condo at the Heritage at Trump Plaza.

The property records at 16-18 West 57th Street do not show a transfer of control of the building itself, only that Barnett’s entity now controls the mortgage and can put pressure on Bracha by beginning a foreclosure process or otherwise collect on the mortgage.

There is no evidence the mortgage is in default, but generally lenders do not sell performing loans.

The project has stumbled financially, at least with one architectural firm. The widow of architect Frank Williams, who died in 2010, filed a lawsuit in August to recover what she claims are $532,461 in architectural services that were never paid.

Extell, Petra Binstock and Bracha either did not respond to requests for comment or declined to comment.

Mattress retailer Sleepy’s is on the third floor of the building, and Arthur Murray Dance Studios occupies the fifth floor. The ground floor retail and other floors are empty, people familiar with the property said.

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