Cushman family scion sued by former partners

A Santa Monica hotel investment firm says the grandson of Cushman & Wakefield co-founder didn't deliver

Los Angeles /
May.May 23, 2018 03:58 PM
Stewart Cushman, Integrated Capital president Kenneth Fearn, and the company’s office at 11150 Santa Monica Boulevard

The rainmaker never made it rain.

The former business partners of Stewart Cushman are suing the Cushman & Wakefield family scion over terms of his dismissal from their Santa Monica hotel-focused real estate investment firm, Integrated Capital.

The lawsuit alleges that the firm’s leadership — president Kenneth Fearn and vice president Daniel Kurz — started the company with Cushman in 2004 on the promise he could leverage his industry contacts to find investors and to assist with fundraising.

Each contributed capital at the start of the business in exchange for membership units. Cushman contributed $245 for 245 units, according to the suit. Kurz contributed the same, while Fearn put in $510, giving him a controlling stake.

Cushman is the great grandson of Cushman & Wakefield co-founder J. Clydesdale Cushman, who started the real estate service firm in 1917 with his brother-in-law, Bernard Wakefield. Stewart Cushman is also the son John Cushman III, who is now Cushman & Wakefield chairman of global transactions.

Unlike his grandfather’s partnership, Stewart Cushman’s union with Integrated Capital was not built to last. According to the suit, Cushman failed to perform his duties, so Integrated Capital removed him as an officer.

The firm moved to repurchase those 245 units from Stewart Cushman for the $245 he invested, not its fair market value at the time of his dismissal in 2017. Cushman refused to take the amount, along with an additional $245 payment for units of an Integrated Capital subsidiary company they founded together in 2014.

The firm argues that Cushman’s alleged failure to perform his duties constituted a cause for dismissal under its operating agreement, which allows the firm to reimburse him at original purchase price. Cushman said Integrated Capital has no cause for his dismissal, so he has a right to be reimbursed for its fair market value, which isn’t specified in the suit.

Integrated Capital wants a judge to affirm it was right to reimburse Cushman at the original price, along with legal fees and costs accrued in the legal process.

The company owns eight hotel properties around the country, including Aloft Miami Dadeland in Miami, along with others in Atlanta, South Carolina and Texas. It previously owned three properties in Los Angeles, including the Miramar Hotel in Santa Monica, which is now set for a major redevelopment.

Fearn and his attorneys did not immediately return a request for comment. Stewart Cushman could not be reached for comment. He has since joined the family firm, Cushman Realty Partners, which counts other members of the family, including his father, as officers. DTZ acquired Cushman & Wakefield in 2015.


Related Articles

arrow_forward_ios
CIM’s Shaul Kuba with renderings of the project at 6007 Sunset Blvd in Hollywood (Getty, CIM Group)
CIM sells site of 109-unit resi development in Hollywood
CIM sells site of 109-unit resi development in Hollywood
Councilman Bob Blumenfield with 5300 N. Oakdale Ave (Dean Musgrove, iStock)
Last commercial orange grove in the San Fernando Valley slated for luxury homes
Last commercial orange grove in the San Fernando Valley slated for luxury homes
From left: Stockdale Capital Partners' Steven and Shawn Yari with 656 San Vicente Blvd
Stockdale Capital gets early green light for 140K sf medical tower near Cedars-Sinai
Stockdale Capital gets early green light for 140K sf medical tower near Cedars-Sinai
HBC's Richard Baker with  9600 Wilshire Blvd (SFA, Cornell)
Historic Saks Fifth Avenue complex in Beverly Hills eyed for redevelopment
Historic Saks Fifth Avenue complex in Beverly Hills eyed for redevelopment
Clear Capital LLC founding partners (L-R) Daniel Hardy, Eric Sussman, Paul Pellizzon and Greg Worchell with Foothill Ridge apartments, 1334 W. Foothill Blvd., Upland (Clear Capital LLC, Foothill Ridge Apts.)
Clear Capital buys 232-unit apartment complex in Inland Empire
Clear Capital buys 232-unit apartment complex in Inland Empire
Citrus Commons project at 14130 Riverside Drive (Johnson Fain)
Apartments to rise around former Sunkist HQ in Sherman Oaks
Apartments to rise around former Sunkist HQ in Sherman Oaks
From left: Tom Brady, Dillon Rosenblatt, and  Richard Rosenblatt with 3130 Wilshire Boulevard (Kilroy Realty, Getty, LinkedIn)
Tom Brady’s NFT company signs lease in Santa Monica
Tom Brady’s NFT company signs lease in Santa Monica
Vectra CEO Raju Shah and 640 North Sepulveda Boulevard (Vectra, LoopNet)
Mostly vacant Bel-Air office building sells for $32.5M
Mostly vacant Bel-Air office building sells for $32.5M
arrow_forward_ios

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

Loading...