Balazs Lower Manhattan purchase hit with commission dispute

From left: Hotelier Andre Balazs, Neil Gronowetter, chairman of Multifamily Investor and 5 Beekman Street

An independent Manhattan broker who says he brought famed hotelier Andre Balazs to buy the 10-story building 5 Beekman Street in Lower Manhattan, claims that the sellers Bonjour Capital and Chetrit Group are refusing to pay him a 1 percent commission, a lawsuit filed in New York State Supreme Court yesterday shows.

The broker, Neil Gronowetter, chairman of his single-broker shop Multifamily Investor, says in July 2010 he introduced Balazs to representatives of Bonjour Capital, who promised him verbally that he would receive a 1 percent commission, the lawsuit says.

Balazs is reportedly in contract to buy the 128,000-square-foot property built in 1883, which Bonjour and the Chetrits planned to convert to a 200-room hotel after buying it for $61 million in 2008.

The suit accuses Bonjour and a company affiliated with the Chetrits of refusing to pay the commission once the deal closes. The complaint does not name Balazs as a defendant, although it says he agreed to pay a commission of 1.5 percent of the equity paid in the deal. The contract sale price has not been disclosed.

Bonjour’s head, Charles Dayan, disputed the lawsuit’s version of the origination of the deal, including that Gronowetter introduced him to Balazs or even that there was a July 2010 meeting at which Gronowetter told Dayan about Balazs, as the complaint alleges.

Dayan says the company’s outside real estate advisor Hillel Spinner introduced Balazs to the sellers, although Dayan declined to comment beyond that. The Chetrit Group and Balazs did not respond to requests for comment (note: correction appended).

Gronowetter’s attorney, Luigi Rosabianca, a partner at law firm Rosabianca & Associates, said his client had been treated improperly.

“Neil has been victimized by well-known organizations that are looking to deny him what he’s rightfully earned,” Rosabianca said.

However, Gronowetter admits that he is in part to blame for his troubles.

In the court papers, he acknowledges that did not read carefully a document that he believed to be a brokerage contract before signing it. The paper turned out to be a sales document, barely applicable to his situation.

But he stands by his contention that he is due a commission.

“Even if neither an oral contract nor a valid written agreement exists between [Gronowetter] and [Bonjour], [Gronowetter] is still entitled to a commission and/or compensation,” the complaint says.

Gronowetter and Bonjour “entered into a written agreement which was erroneous and contained mutual mistakes, or terms which were intentionally misstated,” the complaint says, including defining Gronowetter as the potential purchaser, and saying Bonjour was entitled to the 1 percent commission.

The case claims that this month Spinner told Gronowetter that he was not due a commission, and furthermore if the sellers or Balazs made a payment, part of that would be split with Spinner. Spinner declined to comment on the suit.