It’s back on: Flatiron Building auction set for May 23

The newest season of the Flatiron Building drama drops May 23.

The iconic property is hitting the auction block for the second time, weeks after a surprise bidder won an auction for it with a $190 million bid, then flopped on a required deposit to close the deal.

The vacant building will be auctioned off again on May 23 at 2:30 p.m. on the steps of the New York County courthouse in Lower Manhattan. 

At the last auction in March, Jacob Garlick outbid a group led by longtime owner Jeffrey Gural, but failed to produce the required $19 million deposit. Gural’s group then declined an option to acquire the building at their last bid price of $189.5 million, leaving its fate in question.

Garlick was able to enter last month’s auction in part because it did not require any upfront deposit, something industry insiders described as unusual.

Few guardrails appear to be in place to prevent a similar fiasco this time around. The new auction will not require participants to make a deposit either. Instead, the terms require the winning bidder to put down just $100,000 to the court-appointed referee.

The auctioneer, Matthew Mannion of Mannion Auctions, said a winning bidder will be required to produce a certified check at the auction. 

It’s unclear whether Garlick, a millennial from Northern Virginia with no known experience in big ticket real estate, will be able to participate in this round of bidding. Sources confirmed to The Real Deal last week that Garlick was angling to get back into the mix to acquire the building and has been scrambling to show he has the funds to do so. He still may be liable for the $19 million deposit, according to Gural.

The building went up for auction because of a partnership dispute between its owners.  Sorgente Group, Gural and ABS Real Estate Partners, who together controlled a 75 percent stake, could not see eye-to-eye with the remaining 25 percent owner, Nathan Silverstein. In the auction, the owners were able to use their existing interests to bid on the property, positioning the Gural-led group as the clear favorite.

Silverstein confirmed to TRD that he is a distant relative of Garlick’s, but claims they have only met once. 

The Commercial Observer reported the news of the auction earlier Thursday.