An eight year legal drama in Gowanus is wrapping up with a foreclosure.
Marvin Azrak’s Maguire Capital Group, an active player in distressed New York City real estate, has stepped in to overtake the foreclosure at 255 Butler, the site of a drawn out battle between the Akkad family and Sam Boymelgreen, son of controversial New York developer Jeshayahu “Shaya” Boymelgreen.
The ownership group shares the same name as its address. The 99,500-square-foot property belongs to family members Ariel Akkad, Nathan Akkad, Solomon Akkad and Benjamin Akkad.
On June 15, Maguire purchased a note from Cathay Bank with a principal of $11 million secured by the 255 Butler group.
The swap came two months after Cathay, the Akkad family’s original lender, filed their own pre-foreclosure action for $8 million weeks after the family failed to make payments on their loan in the wake of a dramatic lawsuit, which ended in a $36 million judgment in favor of Boymelgreen in March.
Azrak declined to comment on the purchase.
The Akkad family acquired the property in 2013 with an $11 million mortgage from Cathay Bank. Shortly afterward, Sam Boymelgreen then stepped into the picture, signing a 49-year lease on the property with initial plans to convert the empty warehouse into a hotel.
Instead, after investing some $8 million into the property, a new opportunity emerged. Coworking giant WeWork offered to sublease the property from Boymelgreen in a 15-year agreement, flipping the 100-year-old space into an office share.
But the Akkad family didn’t like that. After hearing of the arrangement, the family allegedly began working to cut Boymelgreen out of the arrangement, according to a legal complaint, looking to benefit from the WeWork lease directly.
By July 2015, the Akkad family had slapped Boymelgreen with notices of default, claiming his firm had failed to pay taxes on the property and that the proposed multi-unit commercial property did not fulfill the requirements of the original lease.
The notices spooked WeWork and left Boymelgreen unable to operate the property, the lawsuit alleged, costing his firm tens of millions of dollars.
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