The Real Deal New York

Taking on Toby

Developer Toby Moskovits is helping usher in a wave of commercial growth in Brooklyn,
but she’s leaving former partners in her wake

September 01, 2015
By Mark Maurer

Toby Moskovits

Toby Moskovits

At a time when residential development in Williamsburg is surging, some developers are working to usher in a new wave of commercial growth. Toby Moskovits is one of them.

But as the 38-year-old founder of the development firm Heritage Equity Partners takes on an ambitious slate of office buildings and hotels in a neighborhood not known for them, she is also leaving a growing list of former business partners in her wake.

Moskovits is currently embroiled in five lawsuits — four of which she filed in the first three months of this year.

Her 20-person firm, which has offices in Midtown East and Williamsburg, is tackling a bevy of buzz-worthy projects, including the 400,000-square-foot office complex known as the Generator at 25 Kent Avenue in Williamsburg. The project, which will target tech tenants, is Brooklyn’s first speculative office building in decades.

Heritage is also constructing the 150-room Williamsburg Hotel and rental properties in Long Island City and Prospect Heights, along with other projects.

But despite her healthy pipeline of projects, ongoing disputes — with former partners and under-the-radar Brooklyn heavyweights like Zelig Weiss, Yoel Goldman and Joel Gluck — hang over many of these undertakings. While Moskovits’ doggedness may cause problems in some of her partnerships, it does not seem to be slowing her development down. So far, her few completed projects include a 40-unit church-to-rental conversion known as the Spire Lofts and a 41-unit rental building at 227 Grand Street — both in Williamsburg.

Sources describe her as personable, smart and perceptive of the market.

Assemblyman Joseph Lentol, who has advocated for the Generator project, likened her intensity to a “whirling dervish.” She does indeed talk fast and spew out complex information about loan structuring and deals as nonchalantly as if she were discussing what she ate for dinner last night.

A rendering of 25 Kent Avenue

A rendering of 25 Kent Avenue

And others noted her formidable presence in a male-dominated industry, which is only underscored by her high fashion sense, ranging from patent-leather high heels to items like a faux snakeskin raincoat. 

“She can run a room. She holds court, so to speak. She will never be standing at a party alone,” said Dave Maundrell, founder of, which marketed the Spire Lofts.

Partnership problems

Moskovits — who, like her former partners, is Orthodox Jewish — began her career raising venture capital for tech firms, first in Jerusalem and then in New York.

In 2005, she joined Ruby Schron’s Cammeby’s International as a managing director of private equity and venture capital investments. Three years later, she founded Heritage to advise wealthy families on investments, but soon switched gears and turned to development.

At a time when banks were barely lending on construction, Moskovits broke into
the market.

“I had a lot of relationships with very deep-pocketed family offices,” she told The Real Deal over coffee at Williamsburg’s trendy Wythe Hotel. “I was able to make use of nontraditional sources of financing. Even when there wasn’t any bank debt, I was in a position to take over some projects.”

Her own family runs a Brooklyn-based company called Schwarzman Export Import Co., which distributes military products. Moskovits, who was divorced in 2011 and has a 10-year-old son, also grew up in Brooklyn, where most of her projects are concentrated.

The William Vale Hotel

The William Vale hotel

“In many of these properties, I’m in much cheaper than other people were able to buy at, simply because I moved sooner and took risks that the typical real estate industry learned to reject,” she said.

The 21-story William Vale hotel (formerly called the Level Hotel) on Wythe Avenue, which she was developing with Weiss, was one of those projects. But she said Weiss and Goldman, a minority partner, bought her out early on. “[We] ended up going in different directions,” she said.

Meanwhile, for the past few months, Moskovits has been in negotiations with Goldman and Gluck on a settlement that sources said would likely amount to a divorce in which Moskovits would buy out their stakes in all joint projects.

Moskovits’ partnerships with each of the three developers varies: She’s teamed up with Goldman on the majority of her projects, while she’s only worked with Gluck and Weiss a handful of times.

Her suit describes her relationship with Goldman and Gluck, who regularly partner with each other, as one where she would source sites to develop and obtain debt financing, while they would provide additional funding.

‘Bonding’ issues

In two of the four complaints she filed this year against them at the Spire Lofts and a rental development on 28th Street in Long Island City, Moskovits alleges fraud and breach of fiduciary duties.

She claims that they used their joint LLC partnership to secure a Tel Aviv bond offering, and by doing so, also pledged Moskovits’ interest.

Goldman and Gluck subsequently each raised $100 million in separate bond offerings, according to Victory Consulting’s Gal Amit and Rafael Lipa, who advised them.

Meanwhile, in her other two suits, she is seeking an interest in two of the properties owned by Goldman and Gluck — one at 169 Graham Avenue and 434 Albee Square — based on the bond offering.

In court documents, Goldman and Gluck insinuated that Moskovits is jealous of their success.

“Most likely, Moskovits brought this lawsuit against Goldman to exact revenge because he succeeded where she did not,” Goldman wrote in a memorandum.

“We believe that the lawsuits are totally without basis … especially given the fact that we have been responsible for providing nearly all of the funding for these projects,” said Mark Walfish, an attorney for Gluck.

In court documents, the pair cited an article published in the Israeli newspaper Calcalist in which underwriters say they met with Moskovits to review a bond issuance in Israel. The issuance was rejected based on Heritage’s low asset volume and lack of enthusiasm from institutional investors, Calcalist reported. A source close to Heritage, however, denied any effort to issue bonds in Israel.

Regarding the settlement negotiations, a source close to Goldman and Gluck said, “They are afraid of her. She can become very difficult. It’s a delicate rope to walk. They don’t want to piss her off and yet do what’s right.”

As a developer, Moskovits’ earliest partnership remains her strongest.

In 2009, she partnered with developer Michael Lichtenstein, who is also a zoning lawyer, on at least four projects of his that were struggling. All except one were successfully sold, with Moskovits renegotiating the debt and investing more capital. Lichtenstein, who could not be reached for comment, independently manages the construction of Heritage’s projects.

Right place, right time

Moskovits has recently turned to more conventional sources of construction financing.

She’s secured a $70 million construction loan from Madison Realty Capital for 25 Kent and $40 million from G4 Capital Partners for the Williamsburg Hotel.

“She makes an aggressive bid when she wants something. She’s not someone who performs due diligence for six months,” Maundrell said.

David Maundrell (Photo: Guest of a Guest)

David Maundrell (Photo: Guest of a Guest)

Industry observers said her vision for 25 Kent as a creative office hub shows impressive foresight. Since Moskovits plunked down $31.8 million for the site in 2012, major tech tenants such as Etsy, Vice, MakerBot and Kickstarter have struck deals for Brooklyn office space. She is currently awaiting city approval to set aside only 20 percent of the building for light manufacturing rather than the 100 percent required because it’s in a manufacturing zone.

The Kent deal was not easy to lock in. The existing property had a tenant with seven years left on its lease. Rather than walking away, Moskovits built a new office space in Maspeth for the tenant, a North Carolina-based construction equipment leasing company.

“There was a tremendous amount of risk when she decided to do that deal,” said Dan Marks, vice president of investment sales and leasing at TerraCRG, which was not involved in the purchase. “The market has matured considerably, so there’s a lot less risk now.”

The building may have one or two larger anchor tenants, but will be mostly be an incubator space for small tech startups that could later expand, Moskovits said. Asking rent at the property will be in the mid-$60s per square foot, sources said.

In addition to her commercial projects, Moskovits still has her sights on residential rentals. She is bringing roughly 170 apartments apiece to sites in Prospect Heights and Long Island City.

Nonetheless, she said she has no interest in condos.

“It’s a market that I don’t choose to play in,” Moskovits said. “If there’s any sort of hiccup in the economy, the first area we’ll see it is in condos, so I’ve generally stayed away from that.”

However, if she were to try and fail, she’s not likely to walk away.

“My grandfather was an immigrant,” she added. “His first three businesses went bankrupt. He picked himself up at over the age of 50 and started again. There’s a certain scrappiness that you learn on the streets of New York, particularly in this borough.”