Ex-United exec sues firm after botched 866 UN Plaza buy

New York /
Dec.December 20, 2013 11:21 AM

UPDATED, 12:12 p.m., Dec. 22: The former president of United Realty Partners is suing the firm and its CEO over an allegedly improper fund transfer that resulted in United being disqualified as a prospective buyer of 866 United Nations Plaza. On Tuesday, Meadow Partners closed on the $200 million acquisition of the office tower, between First and York avenues, from Vornado Realty Trust.

United was contemplating partnering with Meadow on the buy, as The Real Deal reported yesterday. Meadow and United entered contract last month. But United’s investor group failed to raise enough money and Meadow purchased the 360,000-square-foot asset alone.

Now Eli Verschleiser, formerly of United, alleged in New York State Court that United and its CEO Jacob Frydman improperly transferred $6.9 million of investors’ funds after Verschleiser resigned. Frydman still controls the funds, the suit says, despite the fact that they were not deployed in the failed bid to purchase 866 U.N. Plaza.

“All investor money was returned immediately, and before the lawsuit was ever filed,” Frydman said in a statement provided to The Real Deal. “In fact, in denying the temporary restraining order that Mr. Verschleiser requested, the court stated that he had not shown any likelihood of success in the case.”

Vornado netted about $146 million from the sale after repaying current debt and various closing costs, Law360 reported.

Meadow also recently acquired a 130-unit rental building at 110 Green Street in Greenpoint for $72 million. [Law360]Mark Maurer


Related Articles

arrow_forward_ios
Vornado's Steve Roth and 220 Central Park South (Credit: Getty Images, iStock)
Free and clear: Vornado pays off debt at 220 CPS
Free and clear: Vornado pays off debt at 220 CPS
Vornado chairman and CEO Steven Roth, and 608 Fifth Avenue (Credit: Getty Images)
“Negative surprises”: Vornado execs talk retail struggles on Q2 earnings call
“Negative surprises”: Vornado execs talk retail struggles on Q2 earnings call
Steven Roth, CEO of Vornado and 640 Fifth Avenue (Credit: Getty Images and Vornado Realty Trust)
Bank of China issues $500M to Vornado in refi of 640 Fifth Avenue
Bank of China issues $500M to Vornado in refi of 640 Fifth Avenue
909 Third Avenue and Vornado's Steven Roth (Google Maps, VNO)
601W sells dirt under Vornado’s 909 Third Ave for $192M
601W sells dirt under Vornado’s 909 Third Ave for $192M
555 California Street with Steve Roth and Donald Trump (VNO, Getty/Patrick McMullan, Getty)
What tenants pay at Vornado and Trump’s 555 California Street
What tenants pay at Vornado and Trump’s 555 California Street
Vornado’s Steve Roth with Penn1, Penn 2 and the Farley Building (Getty, VNO)
Vornado’s Roth “disappointed” in lack of distress as market shows signs of recovery
Vornado’s Roth “disappointed” in lack of distress as market shows signs of recovery
Jamie Dimon, Steve Roth, Donald Trump and 555 California St. (Trump, Getty)
Vornado lines up $1.2B refi of SF tower co-owned with Trump
Vornado lines up $1.2B refi of SF tower co-owned with Trump
Vornado’s Steve Roth and 888 Seventh Ave (Getty, Google Maps, iStock)
Vornado sues Hongkun USA, seeking $1.1M in rent
Vornado sues Hongkun USA, seeking $1.1M in rent
arrow_forward_ios

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

Loading...