The Real Deal New York

An empire of bupkes: Macklowe claimed his real estate is worth just $23M

Linda's lawyers argue developer said different things to different banks
By E.B. Solomont | December 06, 2017 05:35PM

From left: Linda Macklowe, CVS, 432 Park Avenue, One Wall Street and Harry Macklowe

How liquid is Harry Macklowe? Depends on which bank you ask.

The developer and founder of Macklowe Properties submitted differing financial statements to different lenders, according to evidence his estranged wife’s lawyers presented at the couple’s divorce trial Wednesday.

“So you’re telling one bank you have $29 million in liabilities, another you have $67 million in liabilities and another you have $100 million in liabilities. Is that correct?” John Teitler, Linda’s lead attorney, asked Harry in court.

“What do you mean by liabilities?” Harry replied.

Teitler primarily focused on a 2015 financial statement which Macklowe Properties reportedly submitted to BankUnited, indicating that Harry’s net worth was $603 million. That included $632.9 million worth of real estate and other assets, minus $29.8 million in liabilities. His real estate investments included a stake in 1 Wall Street (value: $8.9 million), 432 Park retail (value: $12.5 million), the Park Lane (value: $6.3 million) and 20 CVS stores (value: $12 million).

Teitler also dug up a pretrial brief in which Harry said the value of his commercial real estate was just $23.6 million.

“You were representing to banks that your investments in commercial real estate were $548.9 million, but the position you’re taking [in this lawsuit] is that the interest is worth $23 million?” he asked.

That prompted an objection from Peter Bronstein, Harry’s lawyer. “He’s mixing apples and oranges!”

“I don’t know about that,” Judge Laura Drager interjected.

Harry has tried to downplay his financial strength during the trial as he vies to keep the lion’s share of a fortune estimated to be worth $2 billion. Linda has done the same, as The Real Deal reported last month.

Last week, Harry — who’s claimed during the trial that he’s $400 million in the red — testified that his profits at 432 Park Avenue were $48 million, not the $400 million he initially hoped for.

But Teitler on Wednesday showed the court an inventory summary for 432 Park, dated February 2016, which estimated Harry’s total earnings for the project at $428.3 million.

As the couple’s lawyers squabbled over whether such documents were admissible, Drager seemed to have had enough.

“The level of detail you’re getting into, we’ll be here for years,” she said. “That’s fine… This is a choice the parties have made for how they want to proceed in this litigation.”