Developer Kent Swig and Sheffield57

Former Sheffield57 developer Kent Swig filed an appeal to the New York State Appellate Division to overturn a $28.4 million judgment issued in July on behalf of Square Mile Structured Debt, a firm led by investor Jeffrey Citrin. In court papers filed earlier this year, Square Mile alleged that Swig defaulted on a $21.15 million personal loan issued in July 2007 to help finance the development of Sheffield57, a converted condominium at 322 West 57th Street. Swig, in court records filed late last week, argues against the judgment, stating that the loan was to be converted into a stake in Sheffield57, and not be repaid in cash. [more]

A New York State Supreme Court granted a $28.4 million judgment Friday
against developer Kent Swig after he defaulted on a personal loan from
a real estate investment firm led by investor Jeffrey Citrin for the
Sheffield57 condominium conversion. The case involved a $21.15 million personal loan that Swig took out in
July 2007 from the lender, Square Mile Structured Debt, to help fund
the conversion of Sheffield57, a luxury apartment building at 322 West
57th Street, which his company was converting from a rental tower. Swig had promised to convert the loan into an equity stake in
Sheffield57, but did not get an agreement from his lenders. Judge
Bernard Fried ruled that because it was a personal loan, Swig was still
on the hook for the money. “Furthermore, contrary to the defendant Swig’s assertion, the loan
agreement and note are instruments for the payment of money only,”
Fried wrote in his ruling. “This case does not involve a complex
financial transaction. The loan agreement establishes a discreet
obligation, and the note was, by its express terms, an absolute,
unconditional promise of payment by Swig.” [more]