Leo Pustilnikov of Builder’s Remedy fame defaulted on a $37.5 million loan connected to a retail spot on Santa Monica’s Third Street Promenade. Entities connected to Pustilnikov, Ely Dromy and Eli Taban are past due on about $39 million as of early November, according to Los Angeles County records.
The five-story, roughly 30,000 square-foot property at 1315 3rd Street Promenade is minutes away from the pier and home to Holey Moley, a mini golf-and-cocktail bar scene that has another location at Irvine Company’s Irvine Spectrum. Pustinikov and his partners appear to be scouting for additional tenants with a brochure via leasing representative Matthews Real Estate Investment Services, which teases food hall availabilities.
Pustilnikov, Dromy and Taban, who are listed on various documents as co-owners and borrowers, did not respond to requests for comment.
Dromy helms Dromy International Investment Corporation, and Taban runs Big Law Partners and EJT Ventures. The Taban clan was deemed a royal family of Los Angeles real estate by The Real Deal nearly a decade ago.
Dromy and Pustilnikov have partnered on real estate before. Three years ago, the two purchased an AMC theater in Santa Monica at 1310 3rd Street Promenade.
Third Street Promenade has seen better days. Since the pandemic, shops, bars and restaurants have less foot traffic and more empty storefronts. The city council recently approved a proposal to let people buy alcohol from businesses and drink in the open air, but the jury is still out on whether that’ll revive downtown Santa Monica.
Pustilnikov, last year, said he was working with the lender on a default tied to a third property in the area, retail that covers 1241 to 1247 3rd Street Promenade. The lender indicated about $19 million was past due.
At the time, Pustilnikov said it was difficult to refinance in that interest rate environment, which hasn’t changed much despite the Federal Reserve’s few rate cuts.
The Santa Monica default has come as Pustilnikov has been busy adding new holdings elsewhere. He recently joined with Kaveh Bral and Josh Javaheri and purchased the PacMutual, three interconnected office buildings, for less than $50 million — a steep discount compared to the $200 million Ivanhoe Cambridge, now La Caisse, paid a decade ago. That downtown buy came after Pustilnikov’s purchase of the Original Pantry, a shuttered diner once owned by the late Los Angeles Mayor Richard Riordan.