David E. Dweck Buys Debt on UES Buildings

David E. Dweck’s Turret Equities has acquired distressed debt tied to two Upper East Side condo buildings with a checkered ownership history.

The buildings, 184 East 64th Street and 227 East 67th Street, have been owned by multiple people accused or convicted of fraud over the past decade. Their current owner, Continuum Analytics, defaulted on its loans and is facing foreclosure by its lender, Preferred Bank. Now, Turret Equities has purchased a $19.9 million note from Preferred, secured by the pair of buildings.

The purchase expands Turret’s portfolio of Upper East Side debt, having acquired a $15.5 million note in 2024 secured by a nine-unit residential townhouse located at 7 East 88th Street. Turret declined to comment on the purchase.

Convicted fraudster Michael D’Alessio first purchased the pair of buildings in 2016 and converted them into five-unit luxury condos with flashy names: The Gianna and The Jacqueline. But just two years later, investors in both of the properties sued D’Alessio for fraud, alleging that he fabricated construction costs on the projects and moved millions of dollars into his own accounts. He was ultimately charged by federal prosecutors for funneling over $58 million of investor money to shell companies he controlled. He pled guilty to the charges and was sentenced to six years in prison.

His lender, Preferred Bank, bought the two buildings at a bankruptcy auction in February 2019 for a combined $32.5 million and sold them for $38 million two months later to Continuum, a California-based real estate data firm. Preferred also provided Continuum with a $29 million loan on the properties and refinanced the properties with a nearly $20 million loan in 2023.

In 2024, two Switzerland-based entities agreed to pay Continuum $24 million for the buildings. The buyers put down a $1.2 million deposit and placed the remaining balance in escrow. But Continuum allegedly tried to back out at the last minute. The would-be buyers sued Continuum in New York state court, claiming it reneged on the purchase agreement and seeking to put the property into receivership over allegations that Continuum owed more than $460,000 in property taxes.

Continuum’s financial troubles extend well beyond the Manhattan properties.

Southern California real estate magnate Gerald Marcil, who owns thousands of multifamily units, sued Continuum’s’ Mahender Makhijani in California state and federal court claiming that Makhijani duped him into signing off on loan documents on short notice, alleging elder abuse. Marcil’s lawsuit in federal court says Makhijani used Nano Banc, an FDIC-insured bank that Marcil says Makhijani controlled, to divert about $20 million to Continuum.

Last month, Makhijani was charged by federal prosecutors with defrauding Western Alliance Bancorp out of nearly $100 million. He has pleaded not guilty.