Allure demands lender pay $40M for Brooklyn nursing home

Joel Landau's firm and Sabre Group are fighting over terms of loan default

TRD New York /
Mar.March 06, 2017 01:40 PM

The Allure Group fired back against a lawsuit filed by its lender on a Brooklyn nursing home, claiming that the financial firm should pay $40 million for the property.

Allure, headed by Joel Landau, claims that the Sabre Group must pay $40 million for 270 Nostrand Avenue and an additional $6 million because the sale of the property didn’t close on time, according to documents filed in State Supreme Court. Allure, one of the developers at the center of the Rivington House scandal, maintains that “the express and unambiguous provisions” of the mortgage it received from Sabre require the Midtown firm to pay $40 million for the property.

A spokesperson for Sabre would only say that Allure has “been in default for quite some time and that’s why we’re pursuing our claims.”

Sabre sued Allure in December, accusing the company of failing to repay a $20 million loan it provided to acquire the Brooklyn nursing home. Allure purchased CABS Nursing Home in Bedford-Stuyvesant in 2015 for $15.5 million. Sabre claims that, under the terms of the mortgage, it can purchase the nursing home for $25 million because Allure defaulted.

But Allure alleges that because the property was vacant and had no pending litigation at the time that Sabr tried to act on its purchase right, the lender is on the hook for higher purchasing price. The landlord also claims that a liquidated damages provision in the mortgage requires Sabr to put $6 million toward the outstanding balance on its loan, since the financial firm failed to acquire the property after Allure repeatedly scheduled closing dates.

Landau declined to comment.

In December, the city admitted that it did not have a legal case against Allure, despite Mayor Bill de Blasio’s promise to sue the company for flipping 45 Rivington Street. Allure made $72 million when it sold the property to Slate Property Group. In April, New York state Attorney General Eric Schneiderman issued subpoenas after Allure filed demolition plans for the Nostrand property, with the intention of replacing it with a seven-story, 241-unit rental building.

The nursing home filed a lawsuit against Allure in December claiming the company marketed itself as a nursing home business while bidding for the property and instead forced residents out. The lawsuit also notes that the property flip may have led to the deaths of a few nursing home residents, who they say were forced out.


Related Articles

arrow_forward_ios
With a cooling trade war, stocks perform well, including real estate. (Credit: iStock)

Real estate stocks push up this week as U.S.-China trade tensions ease

Real estate stocks push up this week as U.S.-China trade tensions ease
416 West 25th Street and Maverick Real Estate Partners principal David Aviram (Credit: Google Maps and LinkedIn)

Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case

Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case
Joe Moinian and 123 Linden Blvd. (Moinian Group)

These were the top outer borough loans in July

These were the top outer borough loans in July
Clipper Equity's David Bistricer (REIT)

David Bistricer’s Clipper Realty reports record Q2 profit

David Bistricer’s Clipper Realty reports record Q2 profit
Vornado CEO Steven Roth and a rendering of the Farley Post Office building (Getty, iStock, SOM)

Vornado will install facial recognition tech in all its buildings

Vornado will install facial recognition tech in all its buildings
Clockwise from top: Savanna's Christopher Schlank with 1375 Broadway, a rendering of 40 10th Avenue and 109 East 79th Street with Victor Sigoura (Google Maps; Getty; rendering via 40tenthave)

These were the largest Manhattan real estate loans in July

These were the largest Manhattan real estate loans in July
From left: Trinity Investments CEO Sean Hehir and Benchmark Real Estate Group principals Aaron Feldman and Jordan Vogel (iStock, LinkedIn, Trinity Investments)

“Blank-check” companies make a comeback in real estate

“Blank-check” companies make a comeback in real estate
28 Liberty Street (Wikipedia)

Manhattan’s office leasing sees busiest month since January

Manhattan’s office leasing sees busiest month since January
arrow_forward_ios

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

Loading...