From left: Square Mile co-founders Craig Solomon and Jeff Citrin

From the March issue: In 2007, a little-known real estate fund called Square Mile Capital Management made $38 million in loans to Kent Swig, then a red-hot New York City real estate player, for him to complete his high-profile condo conversions at both the Sheffield and 25 Broad Street. Square Mile forced Swig to pledge equity in his condos as collateral for the funds, but by 2008, Swig’s empire was beginning to crumble, and Square Mile moved swiftly to collect. The lender alleged that Swig not only defaulted on a loan backed by 25 Broad Street, but overstated his true investment in the Sheffield, constituting fraud. Square Mile won a massive $28.4 million judgment against Swig and proceeded to shake down every asset he owned in New York. [more]

Some of the most commented stories of the year include (from left): the Corcoran Group’s court appeal, the Marcus & Millichap sham sale lawsuit, the closure of Coldwell Banker Hunt Kennedy, and Kent Swig’s Square Mile woes

The most popular story of the year based on the number of comments it has received on The Real Deal Web site is Corcoran appeal of broker privacy ruling begins. The item is about the the beginning of oral arguments in the Corcoran Group’s appeal of a State Supreme Court ruling that found the firm took advantage of former broker Sarit Shmueli by accessing her client list after she was terminated from the agency. The article has generated 232 comments. The second most commented article is a follow-up story on the Corcoran-Shmueli case. The story, “Corcoran ruling upheld in appellate court,” addresses how the ruling against Corcoran was upheld, in what is considered a
landmark case that found agents — and not firms — to be in ownership
of their own client lists. The item received 197 comments. The third most popular story based on comment tally is a question The Real Deal posed to readers: “Who is the best real estate lawyer out there?” One hundred and sixty-one people submitted responses. See the full list of the most commented stories of the year, in order of popularity, here. [more]

Developer Kent Swig was denied a motion to reargue or stay enforcement of a $32 million judgment by Square Mile Structured Debt yesterday. New York State Supreme Court Judge Bernard Fried ruled that Swig failed to prove any legal errors that would allow him to reopen or delay the case. The judgment was issued against Swig after he defaulted on a $28 million personal loan from Square Mile that was used to help develop the troubled Sheffield57 condominium near Columbus Circle. Fried denied the motion despite allegations that Swig was denied access to critical documents and that Square Mile misrepresented key facts to Swig. Fried ruled that the only way to issue a stay would be if the court “overlooked or misapprehended the facts or the law.” The ruling will likely provide further hardship for Swig and his considerable number of real estate assets, which include Swig Equities, the real estate development firm, Helmsley-Spear, the commercial real estate firm previously owned by Harry Helmsley and Terra Holdings (where he is co-chairman and co-owner), the parent company of Brown Harris Stevens and Halstead Property. [more]

Developer and Terra Holdings Co-Chairman Kent Swig, has filed suit against an asset management firm for withholding nearly all of his compensation after a restraining order was issued to enforce a multi-million dollar judgment by Square Mile Structured Debt. Swig filed suit Sept. 24 against Manhattan-based Properties Asset Management Services in New York State Supreme Court, alleging the firm is withholding his compensation after Square Mile sent a subpoena requesting information about Swig’s salary and other compensation at Terra. No information was immediately available on the current amount of Swig’s compensation. [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]