Yoel Goldman puts Brooklyn Site into Bankruptcy

Yoel Goldman’s comeback has hit a snag.

Goldman built and lost a billion dollar empire in Brooklyn. His real estate company, All Year Holdings, was overtaken by restructuring officers, who put it into bankruptcy and sold off its assets. The firm is now seeking to go after Goldman’s handshake deals with his Brooklyn acquaintances.

But Goldman held on to some assets and sought to make a comeback. A recent bankruptcy filing by Goldman shows how he still planned to salvage parts of his real estate holdings.

This week, Goldman put an entity controlling the site at 1550 Bedford Avenue in Crown Heights into bankruptcy. Goldman valued the asset at $14 million.

PincusCo first reported the news.

By Goldman’s telling, his team poured the foundation and planned a 100-key hotel designed by ODA, but development stalled during the pandemic and he ran out of money, according to a bankruptcy filing. Over the course of four years, Goldman attempted to find investors. Ultimately, he could not raise the capital and mechanic liens piled up to over $1.4 million

Goldman had bought the property in 2014 for $7 million, records show.

Since then, Downtown Capital Partners provided a $10 million loan to Goldman towards the development of the property. During the pandemic, Goldman stopped making interest payments on the site. The total amount owed to Downtown Capital, including default interest, rose to $30 million.

A lender would usually initiate a foreclosure or deed-in-lieu where the borrower hands back the keys in the event of a default.

But Gary Katz, who runs Downtown Capital, opted to work with Goldman and agreed to allow Goldman to put the property into bankruptcy. The goal is to sell off the property in an auction and provide unsecured creditors some payment.

“It was worth it for everyone’s interest to put it through formal bankruptcy so that way the property can be sold free and clear of any liens,” said Katz.

Katz said the property could be sold as a boutique hotel. He said there is also interest from buyers looking to build a hotel for transient housing or homeless housing. The property is expected to go for $13 million to $15 million.

A bankruptcy also makes sense given Goldman’s extensive ongoing litigation. The developer made an unknown amount of handshake deals. The restructuring officers in charge of All Year’s wind-down firm are seeking to collect on some of those deals, including one with Goldman’s neighbor and yeshiva friend, Yoel Silberstein. Goldman has pleaded the fifth amendment to many questions asked by All Year’s lawyers.

By putting the property into bankruptcy, it ensures those creditors do not have claims on the property and will not stymie future development plans with litigation.

An example of an unsecured creditor seeking to collect on the property is Abe Greenhut, who claims to have a 10 percent stake in the hotel’s future profits, according to the filing. Greenhut was a co-investor in another Brooklyn property with Goldman and the two were involved in litigation.

Katz said all the outstanding violations on the Crown Heights site have been resolved.