Subcontractor sues Swig FiDi project

TRD New York /
Oct.October 16, 2008 02:57 PM

Lehman Brothers’ bankruptcy has caused another headache for Swig Equities’ stalled condominium conversion project in the Financial District — a dearth of funds to pay contractors.

Nova Development Group, of New Brunswick, NJ, which provided asbestos abatement at 25 Broad Street and Exchange Place, filed a lawsuit in Manhattan State Supreme Court October 10, seeking $764,100 for work done between February and July this year, according to the complaint.

Earlier this month, Swig Equities said it had suspended sales at the project, citing Lehman Brothers’ bankruptcy. Lehman Brothers Holdings, which filed for bankruptcy protection September 15, was a major funder of the planned conversion of the office building to a 346-unit condo.

Nova Development Group filed the lawsuit seeking payment from Swig Equities’ 25 Broad LLC and the contractor who hired Nova for the project.

Swig Equities said in a statement that it expected more subcontractors and contractors to file mechanic’s liens against the building because Swig’s funding from Lehman Brothers has been halted, rendering the developer unable to pay the contractors.

“Due to the effect of the Lehman bankruptcy, the construction loan funds for 25 Broad are frozen and it is anticipated that liens may be filed while the Lehman bankruptcy is pending,” the company said through a spokesman. “As soon as 25 Broad’s operating accounts are unfrozen, the project expects that all outstanding invoices will be paid in the normal course of business.”

Ronald Steinvurzel, the attorney representing Nova, recognized that Lehman Brothers had suspended funding for 25 Broad Street, but said Nova wanted to file its legal action to make certain it would be paid down the line.

“The financing fell through, which is par for the course in today’s economy,” Steinvurzel said, adding, “We had given as much time as possible to the owners. But you have to file your lien to preserve your rights.”
 


Related Articles

arrow_forward_ios
(Image by Wolfgang & Hite via Dezeen)

Hudson Yards megadevelopment inspires a new line of sex toys

Hudson Yards megadevelopment inspires a new line of sex toys
Cammeby's International Group founder Rubin Schron and, from top: 194-05 67th Avenue, 189-15 73rd Avenue and 64-05 186th Lane (Credit: Google Maps)

Ruby Schron lands $500M refi for sprawling Queens apartment portfolio

Ruby Schron lands $500M refi for sprawling Queens apartment portfolio
Wendy Silverstein (Credit: Getty Images)

Wendy Silverstein, co-head of WeWork’s real-estate fund, is out

Wendy Silverstein, co-head of WeWork’s real-estate fund, is out
(Getty)

NYC zoos, aquarium plan to reopen this month

NYC zoos, aquarium plan to reopen this month
From left: MetaProp’s Aaron Block, Domio’s Jay Roberts, Homelight’s Drew Uher, FrontDesk’s Jesse DePinto, Serendipity Labs’s John Arenas and Knotel’s Amol Sarva (Linkedin, iStock, Sarva by Sasha Maslov)

VC or PPP? Some proptech firms got both

VC or PPP? Some proptech firms got both
346 Madison Aveue (Google Maps, iStock)

Bidders line up to buy Brooks Brothers out of bankruptcy

Bidders line up to buy Brooks Brothers out of bankruptcy
Retired tennis superstar Chris Evert sells Boca Raton estate

Retired tennis superstar Chris Evert sells Boca Raton estate

Retired tennis superstar Chris Evert sells Boca Raton estate
Robert De Niro and 377 Greenwich Street (Getty, Google Maps)

Robert De Niro says Nobu, Greenwich Hotel are struggling

Robert De Niro says Nobu, Greenwich Hotel are struggling
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...