Neil Shekhter handed another defeat in court battle with AEW

The Santa Monica developer vows to continue fight over joint portfolio

Los Angeles /
Sep.September 19, 2018 02:00 PM
Neil Shekhter and a rendering of NMS Properties’ Wilshire & La Jolla tower at 6401 Wilshire Boulevard (Credit: Urban Land Institute, Steinberg Architects)

The courts have dealt Neil Shekhter of NMS Properties another blow in his Herculean fight against hedge fund AEW Capital over a nine-building Santa Monica property portfolio they once owned together.

The California Supreme Court declined to hear an appeal from Shekhter, the founder and CEO of NMS Properties, of a lower court decision earlier this year that upheld a judgment against him. The decision validates AEW’s 2016 sale of the portfolio for $430 million, according to the Santa Monica Daily Press.

NMS and AEW have been locked in court battles since 2014, when NMS, based in Santa Monica, tried to buy AEW out of the partnership for $106 million. AEW said NMS forged the agreement that NMS claimed allowed such a buyout, then took over control of the properties and sold them.

Shekhter sued, but the courts consistently ruled against him. AEW investigators uncovered evidence the Shekhter destroyed computer evidence related to the case. That led AEW to file a complaint against Shekhter under the Racketeer Influenced and Corrupt Organizations Act, or RICO Act. This week’s decision, along with a June 2017 decision against Shekhter to dismiss the RICO claims, means the suit can move forward.

Still, Shekhter isn’t giving up. His lawyer said that certain claims regarding the buyout provisions in the joint venture agreement weren’t addressed in the decision. Shekhter will file a new complaint next week alleging AEW committed fraud, according to the Daily Press.

He’s also still building. He filed plans for an 89-unit apartment complex at 11001 Pico Boulevard on the Westside in June.

An NMS spinoff called WS Communities is also active, filing plans for a 40-unit mixed-use building in Santa Monica in August. [SMDP] – Dennis Lynch


Related Articles

arrow_forward_ios
PPIH President & CEO Naoki Yoshida and TPG Capital Partner Paul Hackwell (Linkedin, Getty)
TPG Capital selling SoCal-based Gelson’s Markets
TPG Capital selling SoCal-based Gelson’s Markets
Related California CEO William Witte and a rendering of the project (Getty, City of Santa Monica)
Renderings reveal Related’s 296-unit Santa Monica project
Renderings reveal Related’s 296-unit Santa Monica project
MDT Properties Marc Tavakoli and 627-631 N. Dillon Street (Google Maps, iStock/Illustration by Alexis Manrodt for The Real Deal)
Shovel-ready site in Silver Lake trades for $3.5M
Shovel-ready site in Silver Lake trades for $3.5M
Shane Smith and his Santa Monica Estate (Photos via Getty; The Agency)
Vice Media co-founder Shane Smith wants $50M for SaMo mansion
Vice Media co-founder Shane Smith wants $50M for SaMo mansion
(iStock)
LA County sued over commercial eviction moratorium
LA County sued over commercial eviction moratorium
The future of San Francisco’s Oceanwide Center is up in the air again (Getty, Foster and Partners)
Contractors pull out as Oceanwide Center sale falls through again
Contractors pull out as Oceanwide Center sale falls through again
Neil Shekhter (Shekhter by Kevin Scanlon; iStock)
Santa Monica mega-portfolio officially hits market
Santa Monica mega-portfolio officially hits market
NMS Properties' Neil Shekhter and renderings of 1325 6th Street, 1437 6th Street, 1430 Lincoln Blvd. and 1318 Lincoln Blvd. in Santa Monica (Kevin Scanlon, WSC)
City for sale: Shekhter looks to unload mega-portfolio in Santa Monica
City for sale: Shekhter looks to unload mega-portfolio in Santa Monica
arrow_forward_ios

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

Loading...