Inside Chetrit’s Mounting Legal Trouble

It’s been a year of high drama for one of New York real estate’s most enigmatic families. With lawsuits piling up, receivers circling and a newly revealed estate worth more than $825 million, the Chetrits are once again under scrutiny.

The year began with the passing of Jacob Chetrit, a lower-profile but influential figure who ran the Chetrit Organization alongside his brother, Juda. Court filings now peg Jacob’s estate at just over $825 million, according to PincusCo, offering a rare glimpse into the family’s wealth. Unlike their siblings Joseph and Meyer — who helm the more controversial Chetrit Group — Jacob and Juda kept a lower profile in recent years.

Meanwhile, Meyer and Joseph Chetrit are busy fighting fires — both figurative and literal. Meyer is currently in civil contempt for refusing to comply with a subpoena tied to a $39 million judgment over a 2016 fire that destroyed inventory in a neighboring building. The blaze, which ravaged designer Reem Acra’s showroom, led to years of litigation and now demands that Meyer turn over reams of financial records. So far, he hasn’t.

In Midtown, a lender is pushing to install a receiver at the Chetrit Group’s headquarters buildings at 500 and 512 Seventh Avenue. The complaint paints a picture of intentional self-dealing, including $300,000 in alleged fund transfers to other Chetrit-owned entities, $1 million in missing tenant deposits, and even the failure to collect rent from the Chetrit Group itself, which occupies part of the property.

In Williamsburg, the family faces foreclosure at 500 Metropolitan Avenue, home to the Hotel Indigo. Lenders and tenants accuse the Chetrits of mismanagement and abandonment. A class-action suit claims the family overcharged on paper while quietly offering rent concessions to skirt stabilization laws.

The city also sued Meyer and Joseph over conditions at the long-troubled Hotel Carter in Times Square, once dubbed the city’s “dirtiest” hotel. The Adams administration alleges the brothers allowed the building to deteriorate dangerously after defaulting on a $233 million loan.

Still, not every Chetrit holding is in distress. Cousins Isaac and Eli Chetrit appear to have avoided foreclosure at 447 Broadway, securing a new $14 million loan after Maverick Real Estate Partners moved to seize the Soho property. The receiver remains in place for now, but the move signals progress in a case tied to the Signature Bank collapse.

Meanwhile, the Chetrit Organization — now led by Juda and Jacob’s son Michael — has been quietly working out troubled loans of its own. Most recently, it secured a 30-month extension on a $95 million CMBS loan at 393-401 Fifth Avenue from Rialto, despite the buildings being vacant. It also renegotiated terms on two Soho properties, 459 and 427 Broadway.

The result is a growing split-screen view of the Chetrit name: one side mired in legal trouble, the other focused on quiet, deliberate recovery.

There was plenty of other news this week. The deadly shooting at 345 Park Ave. left New York City’s real estate community reeling, CoStar accused Zillow of copyright infringement and Merchants Bank blamed a surge in commercial mortgage fraud for its poor second quarter earnings.

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