A judge has rejected a bid by an investment partner at the Domino Sugar Factory to block its partner from recapitalizing the proposed $1.5 billion project, the New York Observer reported. Katan Group, the project’s main investment partner, filed suit last month seeking to block the deal to sell the project back to its lender, Pacific Coast Capital Partners, as The Real Deal has previously reported. But in state Supreme Court today, Katan’s injunction was not approved, the Observer said.
The decision appears to clear the way for the Community Preservation Corporation, a partial owner of the site, to proceed with plans to hand the project back to Pacific Coast.
Katan had hoped to structure a recapitalization “with another investor who would provide superior terms,” the Observer said. Katan’s attorney, Christopher Milito of Morrison Cohen LLP, also told the Observer that there would be “subsequent legal proceedings,” where his firm would introduce new evidence that Katan had a better recap deal in the works. [NYO]