The Real Deal New York

Eastern Consolidated sues for commission on 2017 office lease

Landlord David Ishay owes $74K, according to brokerage’s lawsuit
By Rich Bockmann | August 29, 2018 03:40PM

Peter Hauspurg and Daun Paris of Eastern Consolidated and 38 West 39th Street (Credit: Google Maps)

Eastern Consolidated may be disbanded, but its receivables account is still very real.

The brokerage is suing landlord David Ishay, claiming it is owed roughly $74,000 in commission for negotiating a lease at the owner’s Bryant Park-area office building in early 2017.

Eastern was the sole broker that hammered out the 10-year lease between tenant GIT Group and Ishay – not to be confused with the David Ishay of Gotham Realty Holdings – at the landlord’s 38 West 39th Street in January 2017, according to a complaint the brokerage filed Tuesday in Manhattan Supreme Court.

But Eastern, which was a player in the world of middle-market brokerage before it closed its doors this summer, claims that “to date, no portion of the brokerage commission due . . . has been paid.”

A representative for Eastern declined to comment, and Ishay did not respond to a request for comment.

In office leases, brokers are generally paid a portion of the commission when the lease is signed, and the remainder when the tenant takes possession of the space.

But it looks like GIT Group, a real estate development firm founded in 2007 by Benny Bern and Olivier Fajga, was delayed in taking possession of the space, due to a dispute with its landlord.

Soon after the ink dried on the lease, GIT said that Ishay “failed and refused” to sign off on building application and plans the tenant needed in order to build out its space.

GIT claims that Ishay approached the company in February about walking away from its lease. The landlord was having trouble getting a loan for the property it had leased too much space in the building to one tenant, GIT claims in court papers.

Ishay served GIT with a notice of default in March of last year for allegedly failing to comply with proper building procedures, and GIT filed a lawsuit against its landlord seeking an injunction.

The two sides reached a settlement in court in May 2017, and it now appears that GIT occupies the space.

Representatives for GIT did not immediately respond to a request for comment.

Eastern closed its doors in July after nearly four decades in business during a tumultuous time in the commercial real estate business. A number of its top brokers have since found new homes.