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The Real Deal Los Angeles

Robert Shapiro resigns from Woodbridge as company files for bankruptcy

TRD investigation published Friday detailed his connection with boutique brokerage Mercer Vine
By Natalie Hoberman | December 04, 2017 07:52AM

Robert Shapiro (Credit: Getty Images)

Robert Shapiro, the chief of embattled real estate investment firm Woodbridge Group of Companies, has resigned from the firm, the company announced Monday. Woodbridge also filed for Chapter 11 bankruptcy, it said in the announcement, as part of a process “intended to restructure its approximately $750 million in debt.”

A “combination of rising costs and regulatory pressure led to a loss of liquidity,” the company said. The move represents a dramatic fall from grace for Shapiro and Woodbridge, which is now under investigation by the Securities and Exchange Commission for potentially orchestrating a major fraud.

The Real Deal reported on the investigation into Woodbridge on Nov. 14. Court documents show that the SEC is investigating whether Woodbridge “operated a fraud on its investors.”

In a subsequent investigation on Dec. 1, TRD revealed that Shapiro was the quiet force behind Mercer Vine, a much buzzed-about boutique residential brokerage in the city. According to Monday’s release from Woodbridge, Shapiro resigned from the company that same day.

Shapiro will remain in a consulting role at Woodbridge, the company said. Lawrence Perkins of SierraConstellation Partners was tapped to be Chief Restructuring Officer and Marc Beilinson of Beilinson Advisory Group will serve as an independent manager. Perkins and Beilinson will lead the company. It’s unclear if Shapiro will resign his position as manager of Mercer Vine. Representatives for Mercer Vine did not immediately return calls seeking comment.

Woodbridge, a developer of luxury spec homes in Los Angeles, “will continue to cooperate fully and work with the SEC and state regulators toward resolution of any investigations,” it said.

“We have a strong, independent management team in place and an institutional source of capital that should set Woodbridge on a path to emerge with the financial flexibility the Company needs to continue its successful operation,” Beilinson said.

Will Parker contributed reporting.